'How will we live?': Egyptian bread price hike alarms the poor

'How will we live?': Egyptian bread price hike alarms the poor
A vendor counts his money at a bread stand in the Sayeda Zeinab neighborhood of Cairo, Egypt. (AP Photo)
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Updated 07 August 2021

'How will we live?': Egyptian bread price hike alarms the poor

'How will we live?': Egyptian bread price hike alarms the poor
  • First attempt in 44 years to hike subsidized bread price
  • Roughly 30% of Egyptians live on less than $55 a month

CAIRO: Plans to raise the price of bread for the first time in 44 years have shocked Egyptians already struggling to get by in a country where state-subsidised loaves have kept the poorest basically fed since the 1960s.
In declaring this week that it was time to hike bread prices, President Abdel Fattah El-Sisi aims to curb an expensive subsidy program that serves some two-thirds of Egypt’s 100 million people and helped keep political dissent at bay.
“How will we live? And how will we pay for the children of our deceased brother who live with us?” said Wafaa Bakr in Shubra El-Kheima, a dilapidated working-class district sprawling along the outskirts of Cairo.
“The price of a loaf of subsidised bread is a red line — there are widows and orphans who do not have a fixed income,” said Ahmed Saeed in Sharqia, in the Nile Delta north of Cairo.
Some 30 percent of Egyptians fall beneath the government’s poverty line, with incomes below 857 pounds ($54.73) a month. Many struggle without running water or sanitation.
The minimum monthly wage is 2,400 pounds ($153) but that is sometimes not paid in the informal sector, where roughly two-thirds of Egyptians work. Joblessness was at 7.2 percent at the end of last year, and has been chronically higher among young people.
However, economists have said for years that Egypt, the world’s biggest wheat importer and Arab world’s most populous country, must rein in subsidies to modernize its economy.
Bread subsidies now weigh ever heavier on the budget as supply jitters have driven up global wheat prices during the coronavirus pandemic.
Bread subsidies were set at nearly 45 billion Egyptian pounds ($2.9 billion), just over half of the food subsidy bill, for the fiscal year ending in June. This amounts to roughly 1.8 percent of overall state spending.
“It is time for the 5-piaster (0.32 US cent) loaf to increase in price,” El-Sisi said during televised remarks at the opening of a food production plant on Tuesday, referring to a round 90-gram loaf known as ‘eish baladi’.
El-Sisi said he hoped the news would not be poorly received and that the government was not planning a big increase. “It’s incredible to sell 20 loaves for the price of a cigarette.”
The government has already pared back subsidies on electricity and fuel, ushering in annual increases in their price since 2016 as part of market reforms linked to financing from the International Monetary Fund.
Egyptian governments have long exercised caution when it comes to the price of bread, which in Egyptian colloquial speech derives its name from the Arabic word for ‘life’.
An attempt in 1977 by then-President Anwar Sadat to increase bread prices set off deadly riots across Egypt that did not subside until the decision was rescinded.

PRICE ‘NOT SACROSANCT’
El-Sisi’s government has been gradually laying the ground for change, however, notably by rolling out cash transfer programs that better channel state subsidies to the most needy.
“There’s been a long softening-up process for this step, including the reductions in the weight of the loaf from 130g to 110g and then to 90g last August,” said David Butter, an analyst for the Middle East and North Africa at Chatham House.
“So the message that the 5p loaf is not sacrosanct has been out there for some time.”
Some calculations suggest that simply doubling the price to 10 piasters could save up to 4 billion pounds a year, he said.
Hassan Mohammadi, head of the Bakeries Division at the Grain Chamber of the Federation of Egyptian Industries, said the decision was overdue. “People eat the front and leave the back, and they use it as fodder for birds and livestock,” he said, suggesting a 100g loaf should be sold at 10 piasters.
He also suggested a 140-gram loaf should be reintroduced and sold at 20 piasters.
What this means for the poor — for whom the state-subsidised loaf, accompanied by whatever else they can afford, represents a meal — is the heart of the matter for Sheikh Ibrahim Radwan, a preacher in a mosque in the Nile Delta city of Kafr El-Sheikh north of Cairo.
“Mr. President, the poor man gets anything simple (to eat) with subsidised bread. We cannot dispense with that or afford any increase in the cost,” Radwan said, addressing El-Sisi.


SAMI launches JV with French firm to build aerostructure components in Kingdom

SAMI launches JV with French firm to build aerostructure components in Kingdom
Updated 20 min 39 sec ago

SAMI launches JV with French firm to build aerostructure components in Kingdom

SAMI launches JV with French firm to build aerostructure components in Kingdom

JEDDAH: The Saudi Arabian Military Industries, a wholly owned subsidiary of the Public Investment Fund, on Saturday launched a joint venture with French company Figeac Aero and the Saudi Arabian Industrial Investments Co., Dussur, to build a high-precision manufacturing facility in the Kingdom to produce aerostructure components, SAMI said on Saturday.

The company said that the joint venture’s revenue would reach $200 million by 2030 and the ownership would be divided among the two countries. Fifty-one percent would be owned by Saudi Arabia and 49 percent by France.

SAMI also signed an agreement with Airbus to form a joint project specialized in military aviation services and maintenance, the statement said. As per the deal, the Kingdom would own 51 percent of the joint venture with the European planemaker holding the other 49 percent.

 


Egypt to increase cotton gins capacity, says official report

Egypt to increase cotton gins capacity, says official report
Updated 04 December 2021

Egypt to increase cotton gins capacity, says official report

Egypt to increase cotton gins capacity, says official report

RIYADH: Egypt aims to increase cotton gins capacity to 4.4 million kantars annually up from 1.5 million kantars, according to a government report issued on Saturday.

A kantar is the official Egyptian weight unit for measuring cotton. It corresponds to the US hundredweight, and is roughly equal to 99.05 pounds, or 45.02 kg. It is equal to either 157 kg of seed cotton or 50 kg of lint cotton.

The Egyptian government is trying to breath a new life into the country’s textile industry, which contributes almost 3 percent to the gross domestic product, employs one-third of the industrial labor and generates exports worth $2.6 billion annually. 

According to reports, the country’s cotton production rose by 30 percent during 2021.

Egypt increased the cultivated area this year to 236,000 feddans (one feddan equals 1.038 acres or 0.42 hectare) compared to 182,000 feddans last year.

In its annual report on Egypt’s cotton on March 31, 2021, the US Department of Agriculture said that “cotton area harvested in Egypt was forecast to increase seven percent to 70,000 hectares (ha), from 65,000 ha in MY 2020/21.” It added that Egypt’s production is estimated to increase to 250,000 bales this year compared to 215,000 bales in the previous year.


Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated
Updated 04 December 2021

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

NEW YORK: Bitcoin shed a fifth of its value on Saturday as a combination of profit-taking and macro-economic concerns triggered nearly a billion dollars worth of selling across cryptocurrencies.

Bitcoin was 12 percent down at 0920 GMT at $47,495. It fell as low as $41,967.5 during the session, taking total losses for the day to 22 percent.

The broad selloff in cryptocurrencies also saw ether, the coin linked to the ethereum blockchain network, plunge more than 10 percent.

Based on cryptocurrency data platform Coingecko, the market capitalization of the 11,392 coins it tracks dropped nearly 15 percent to $2.34 trillion. That value had briefly crossed $3 trillion last month, when bitcoin hit a record $69,000.

The plunge follows a volatile week for financial markets. Global equities and benchmark US bond yields tumbled on Friday after data showed US job growth slowed in November and the omicron variant of the coronavirus kept investors on edge.

Justin d'Anethan, Hong Kong-based head of exchange sales at cryptocurrency exchange EQONEX, said he had been watching the increase in leverage ratios across the cryptocurrency markets as well how large holders had been moving their coins from wallets to exchanges. The latter is usually a sign of intent to sell.

“Whales in the crypto space seem to have transferred coins to trading venue, taken advantage of a bullish bias and leverage from retail traders, to then push prices down,” he said.

The selloff also comes ahead of testimony by executives from eight major cryptocurrency firms, including Coinbase Global CFO Alesia Haas and FTX Trading CEO Sam Bankman-Fried, before the US House Financial Services Committee on Dec. 8.

The hearing marks the first time major players in the crypto markets will testify before US lawmakers, as policymakers grapple with the implications of cryptocurrencies and how to best regulate them.

Last week, the US Securities and Exchange Commission (SEC) rejected a second spot-bitcoin exchange-traded fund proposal from WisdomTree.

Data from another platform Coinglass showed nearly $1 billion worth of cryptocurrencies had been liquidated over the past 24 hours, with the bulk being on digital exchange Bitfinex.

A plunge in bitcoin funding rates — the cost of holding bitcoin via perpetual futures which peaked at 0.06 percent in October — also showed traders had turned bearish.

The funding rate on cryptocurrency trading platform BitMEX fell to a negative 0.18 percent from levels of 0.01 percent for most of November.


Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom

Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom
Updated 6 min 16 sec ago

Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom

Saudi, French firms discuss energy, finance, tourism cooperation as Macron visits the Kingdom

JEDDAH: A group of leading Saudi and French companies are holding discussions at an investment forum in Jeddah as French President Emmanuel Macron is set to meet with Crown Prince Mohammed bin Salman today during his official trip to the Gulf region, where he is visiting Saudi Arabia, the UAE and Qatar between Dec. 3 and 4.

The forum is opened by Khalid Al Falih, Minister of Investment, Saudi Arabia and Franck Riester, Minister Delegate for Foreign Trade and Economic Attractiveness.

Represenatives of French companies and banks including EDF Renewables, Engie, Sanofi, and BNP Paribas are meeting with chairmen and CEOs of leading Saudi firms including ACWA Power, Banque Saudi Fransi, Riyad Bank, and Saudi Military Industries Co. Officials from the Public Investment Fund and Royal Commission of AlUla among others are also participating in the forum. 

 

Below is the agenda for the one-day forum where a some memorandum of understanding are expected to be signed:  


Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4
Updated 03 December 2021

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

RIYADH: Saudi Arabia will start implementing the mandatory application of the first phase of e-invoicing “fatoorah” on Saturday Dec. 4, Argaam reported.

An e-invoice, according to regulations, is a tax invoice that is issued electronically by each taxpayer subject to value-added tax in the Kingdom

The first phase requirements consist of ensuring that there is a technical e-invoicing solution compatible with the relevant requirements. This means no handwritten invoices or invoices written through text editors or number analysis applications on computers.

A fine of SR5,000 ($1,332) will be applied for not issuing and saving the invoices electronically.

The fine for not including the QR Code in the e-invoice and not reporting any malfunction in the issuing of the e-invoice to the authority starts with a warning. The fine for violating the deletion or modification of e-invoice starts from SR10,000.

The second phase of e-invoicing will be implemented in a phased manner, starting from January 1, 2023, to establish integration between e-systems of taxpayers and the authority’s regulations, Argaam said.