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CAIRO — Egypt's Ministry of Supply and Internal Trade will stop issuing subsidy ration cards for Egyptians traveling outside the country, including those who have been abroad for more than three consecutive months, ministry adviser Amr Madkour announced June 5.
Madkour explained in a statement to el-Watan that the ministry will implement the measure in cooperation with the Interior Ministry's passport department.
On June 1, the Ministry of Supply and Internal Trade announced that nearly half a million Egyptian citizens have already been removed from the ration cards system.
On June 2, ration card holders were requested to obtain their bread rations on a daily basis. Those who did not pick up their rations for three days can no longer take the entire amount at once and must wait 48 hours for the rest, according to the decision.
Ahmed Kamal, spokesperson for the Ministry of Supply and Internal Trade, told Al-Monitor via phone that the ministry had already removed nearly half a million citizens from the subsidy system. He stressed that the government’s goal is to offer support to those who need it the most, saying, “Well-off Egyptians should not benefit from subsidies, which should … go only to those who really need it — the most vulnerable.”
Kamal added that the ministry has set new conditions for subsidy eligibility. “Citizens who shall no longer benefit from subsidies include those with high [monthly] salaries that exceed 9,600 Egyptian pounds [$500], owners of major businesses, those who own car models from 2015 and newer, households who pay more than 20,000 pounds (about $1,070) per month for their children’s education and those who own farmland of 10 acres or more,” he explained.
“We notified all citizens who will be removed from the subsidy system and informed them of the reasons for their removal. The concerned persons can appeal the decision. Should they fail to do so, the decision shall be considered valid,” Kamal added.
He went on to say, “If the card holder with a high salary or a modern car is the head of the family, ration cards will be suspended for all family members. But if another member of a family has a modern car and high salary, only they will lose their card and not the rest of the family members.”
Abdel-Khaleq Farouk, director of the Nile Center for Economic and Strategic Studies, told Al-Monitor, “The Ministry of Supply’s recent decisions come in light of the shortage of wheat imported to Egypt from abroad due to the Russian-Ukrainian war as well as the faltering talks between India and Egypt in relation to the importation of Indian wheat.”
“India recently announced significant new restrictions on wheat exports as large quantities of its local crops were damaged due to a heat wave,” he explained.
Farouk added, “Beside the half-million citizens whose ration cards were already suspended, many more people will be gradually removed from the subsidy system in an effort to reduce subsidies on strategic goods to meet the International Monetary Fund’s conditions. This will also clearly reduce the costs of imported wheat, much of which is used to produce bread that is subsidized with ration cards.”
Egypt has applied for a new loan from the IMF and help from the World Bank as it struggles to weather the economic crisis.
Cairo has long been working to reduce subsidies, he said. "The only difference today is that the government is rushing these decisions, whether in reducing bread subsidies or removing beneficiaries, as a result of the wheat crisis.”
He went on, “The Ministry of Supply’s decision to stop the daily ration of subsidized bread came due to the lack of supplies as a result of the wheat and flour shortage crisis. The government does not want a shortage in bakeries that could increase demand.”
Farouk explained, “If a large number of card holders wanted to get several days' ration all at once, as has happened, it would overload the bakeries, which lack the flour to produce enough subsidized bread."
