Sisi Risks Price Reform To Boost Energy Sector

By reducing subsidies on fuel and electricity, President Sisi is taking a huge political risk. But the measure is necessary to revive Egypt’s upstream sector.

Egypt’s new President ‘Abd al Fattah al-Sisi broke one of the region’s biggest political taboos last weekend, when the fuel price increases he had decreed came into effect.

The bold move sparked outrage in Egypt, where a quarter of the population lives below the poverty line, and subsidies on energy and basic foodstuffs are regarded as an economic necessity by large sections of society.

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Angry scenes played out on Egypt’s streets, as passengers baulked at paying higher fares for bus and taxi rides, and drivers cursed the president many had voted into office only a month ago. The increase in transportation costs is reportedly already being passed on to food prices, and inflation is widely predicted to soar.


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