Egypt to curb fuel subsidies
Egypt to curb fuel subsidies
The announcement follows a preliminary deal reached with the International Monetary Fund on Tuesday for a $4.8 billion loan to support the state's finances. The deal included an agreement to rein in wasteful spending on hefty fuel subsidies.
Many ordinary Egyptians are worried that the IMF deal will mean tough austerity measures, so these steps will test the public response. Economists say the terms are not onerous and the government insists steps will still protect the poor.
Planning and International Cooperation Minister Ashraf Al-Araby said 95-octane fuel, the highest grade available, would be sold at "real cost" and this would go into effect within days. He added that there would be a consultation with the public on how to work out a quota system.
Prime Minister Hisham Kandil had told Reuters on Monday that removing the subsidy on 95-octane fuel would save the state 55 million Egyptian pounds ($9.01 million) a year.
Kandil also said quotas for other subsidized fuel, operated by a system of smart cards, would allow drivers enough fuel to get to and from work, but not other journeys such as holidays.
The prime minister said the quota for each driver or vehicle still had to be worked out to ensure it was fair and did not hurt the poor, who often drove older, less efficient cars.
Drivers pay 2.75 Egyptian pounds ($0.45) a liter for 95-octane fuel, well below the international price. The price of lower octane fuel, sold at an even bigger subsidy, is used more widely by the poor.
‘Saudi Inc’ author says no shows won’t dent KSA investment appeal
- Ellen Wald said there was an element of symbolism in the decision by some executives not to attend the Future Investment Initiative
- Wald also said that the absence of many big name investors from the US and Europe might hand an advantage to other potential business partners
RIYADH: An American expert on US-Saudi business affairs believes that the withdrawal of some senior business leaders from the investment conference that opens in Riyadh today does not reflect the Kingdom’s commercial attractions.
Ellen Wald, president of the Transversal Consulting think-tank and author of the recent book “Saudi Inc,” told Arab News that there was an element of symbolism in the decision by some executives not to attend the Future Investment Initiative in the Saudi capital, and that many business people were still looking to do business there.
“I think the big pull out of CEOs is not really reflective of the corporate interest in the Kingdom because we see them sending their next level of executives along. So to some degree it (the CEO pullout) is symbolic. I think what they experience here this week will have an effect,” she said.
Wald also said that the absence of many big name investors from the US and Europe might hand an advantage to potential business partners in other parts of the world.
“In terms of attracting foreign investment, Saudi Arabia could have strategic leverage with Russia and China, and a unique opportunity to work on cutting edge technolgies,” she said.
Wald was speaking at an event organized by the King Abdullah Petroleum Studies and Research Center to discuss her book. She said that Saudi Arabia had a greater need for technology and know-how than for cash investment.
“With regard to foreign investment, it is not about extracting money, but about extracting expertise. The Saudi model has been to hire outside industrial talent, for example the Public Investment Fund and its cinema partner AMC. They are buying expertise in the same way that the Saudis bought in expertise with Aramco, all those years ago. Eventually they (PIF) will buy the cinemas out or bring in somebody else to run them,” she added.