Egypt plans measures to deal with fuel crisis
A number of measures aimed at resolving the recent diesel shortage crisis are in the pipeline, said Hossam Qassem, the official in charge of the fuel dossier for Egypt’s presidency, to state-owned news agency MENA on Wednesday.
These measures include the formation of high committees for fuel in Egypt's governorates to determine local fuel needs and ensure the distribution of the required quantities.
In addition, the presidency plans to establish committees in the warehouses, members of which would include officials of the supply ministry and members of civil society, to monitor distribution operations and intensify daily efforts to halt smuggling, according to Qassem, who made the statements during a visit to the governorate of Fayoum, south of Cairo.
Smuggling of subsidised fuel is rampant in Egypt, as heavy government subsidies have fostered the rise of a lucrative black-market. Diesel subsidies alone account for some LE35.7 billion (roughly $5.5 billion) of the 2012/13 state budget, a figure which is expected to rise further following recent depreciations of the local currency.
The statements came a week after Cairo witnessed a wave of strikes by microbus drivers, in response to acute shortages in diesel fuel, which led to the dismissal of the head the Egyptian General Petroleum Corporation (EGPC), as announced by the Minister of Petroleum Osama Kamel on Monday.
Qassem further highlighted the necessity of a two-pronged approach to the fuel shortage crisis to build an effective system to monitor fuel distribution on the ground and establish an electronic system to regulate distribution through smart cards.
Planning Minister Ashraf El-Araby had announced on Monday that Egypt will start implementing the "smart card" system to sell subsidised petrol on government vehicles in May and on private cars in July 2013 in an effort to cut the country’s massive subsidy bill.