Jordan introduces smart card to save bread

Jordan introduces smart card to save bread
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Published August 21st, 2013 - 13:16 GMT via SyndiGate.info

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Hamawi noted that with the lifting of the subsidies, the price of bread in the Kingdom could more than triple.
Hamawi noted that with the lifting of the subsidies, the price of bread in the Kingdom could more than triple.

The government confirmed on Monday that it would use a smart card mechanism to direct bread subsidies to Jordanians.

At a press conference held at the Prime Ministry, attended by Prime Minister Abdullah Ensour and several other ministers, Minister of Industry, Trade and Supply Hatem Halawani said that Jordanians will use smart cards to purchase bread at its current price, which is JD0.16 per kilogramme, noting that the cost of subsidising flour used for bread stands at around JD260 million this year.

“We are committed to keeping the current price for bread at its level for Jordanians, but I’m sure that no Jordanian accepts the waste in bread and the misuse of subsidised flour,” the minister said, estimating the value of wasted bread and illegal dealings of subsidised flour at JD70 million to JD100 million a year.

Through the targeted subsidy system, the government seeks to direct support only to Jordanians, as there are over 2.5 million foreigners living in the Kingdom, according to the minister.

According to Halawani bread prices in Jordan are the lowest in the world. The minister noted that the continuous flow of Syrians into Jordan has increased the country’s imports of wheat by an estimated 14,000 tonnes a month.

He did not say when the smart card mechanism would be implemented or whether there would be a limit for subsidised bread quantities.

Last week, head of the Bakery Owners Association Abdul Ilah Hamawi said the syndicate was against both a full removal of the flour subsidy and the government’s smart card proposal.

Hamawi said that the best way to reduce the burden of lifting the flour subsidy is through a gradual increase in the cost of bread over a three-year period so that consumers are not hit by a sharp rise in prices. He noted that with the lifting of the subsidies, the price of bread in the Kingdom could more than triple.

Responding to a question on whether the government would continue to raise prices and taxes to generate more revenue, Halawani stressed that although fuel prices were liberalised in November last year, studies show that prices of essential commodities remained stable.

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