Cairo, Egypt (CNN) – Consumers in Egypt are facing an increase in the prices of the so-called “tourist bread”, which is not subsidized, which is the bread that is bought by non-ration card holders, as well as a decrease in its weight, as a result of the increase in global wheat prices in the wake of the Russian war. Ukraine, the fall in the value of the pound, and the government confronted the matter by announcing the preparation of a system for selling subsidized bread to non-beneficiaries from the ration subsidy at the actual cost.
The heads of the bakeries division confirmed that the government system has not yet been implemented, and that it is still in the preparation stage. They also stressed that the implementation of this system will contribute significantly to reducing the price of tourist bread and reducing pressure on consumers.
The Egyptians consume about 300 million loaves daily, between 275 million loaves of subsidized bread sold by municipal bakeries to ration card holders at a price of 5 piasters ($0.00169), weighing 90 grams, with a maximum of 5 loaves per person per day. Al-Ifranji bakeries produce tourist bread in an amount of up to 25 One million loaves exceed the price of one Egyptian pound ($0.034), according to official data and statements.
Attia Hammad, head of the bakeries division at the Cairo Chamber of Commerce, said that the Egyptian government is working on preparing a system for selling subsidized bread to non-ration card holders at the actual cost, and the mechanism for selling bread or its price has not yet been determined, and the division is awaiting the issuance of a ministerial decision clarifying these points to start Implementing the system, which will contribute significantly to providing local bread for citizens, and reducing the price of tourist bread.
The First Assistant Minister of Supply and Head of the Internal Trade Authority, Ibrahim Ashmawy, had previously announced that the ministry would start implementing the experience of selling local bread to non-ration card holders at the actual cost, through prepaid credit cards through the ration bakeries.
Hammad explained, in exclusive statements to CNN in Arabic, the difference between the production of tourist and subsidized bread, saying that Egyptian bakeries buy flour from the market to produce tourist bread, and its price is determined according to supply and demand, and is not subject to government control. Subsidized bread is priced at only 5 piasters ($0.00169), and is only given to ration card holders.
Egypt imports most of its wheat needs from abroad, and the volume of its imports amounted to about $1.6 billion during the first half of last year, an increase of $66 million over the same period of the previous year, while the government is working to motivate citizens to increase the quantities grown locally by raising the price of ardab for the season. 2023, to reach 1,250 Egyptian pounds ($42.16), according to an official statement.
The head of the bakeries division of the Federation of Chambers of Commerce, Abdullah Ghorab, confirmed in exclusive statements to CNN in Arabic that the government is still conducting experiments on the system of selling subsidized bread to non-ration card holders, and has not yet implemented the actual sale to citizens, indicating that there are 33,000 alternative bakeries. A bakery scattered in the Republic is able to apply the system immediately upon completion.
The bread subsidy bill rose in the current fiscal year’s budget to about 93 billion pounds ($3.2 billion) after bread subsidies increased by more than 55 billion pounds ($1.9 billion) following the rise in global wheat prices.
Muhammad al-Abasiri, responsible for the management of a bakery in the Heliopolis district, said that the implementation of the subsidized bread sale system for non-ration card holders will achieve financial savings for citizens, through the price difference between the tourist one, which amounts to 1.5 pounds ($0.05) per loaf for less than $1. EGP ($0.03) for the subsidy, but the matter requires monitoring the system to make subsidized bread available to citizens, and the system will not affect the sale of “tourist” food, which some citizens accept.
Regarding the difference between subsidized and touristic bread, Al-Abasiri explained that subsidized bread is produced with 82% extraction flour – which is the total percentage of flour from ground wheat – while touristic bread is produced with 72% extraction flour, which makes its color whiter than its municipal counterpart. The nutritional value of fortified bread is higher. On the other hand, touristic bread is available throughout the day more than its subsidized counterpart, which runs out quickly.
Meanwhile, Prime Minister Mostafa Madbouly confirmed that the price of bread will not be increased, despite the doubling of subsidies allocated to wheat from 38 billion pounds to about 95 billion pounds, according to official statements today.