Egypt Power Ministry Seeks More Funding As First Megaproject Linked To Grid

Amid mounting debts for fuel supplies the weak pound is pressuring ambitious power expansion plans.

Egypt’s Ministry of Electricity has asked the cabinet for an increase in its monthly cash allocation as a result of last November’s 50% devaluation of the Egyptian pound. The plea comes as the ministry’s major capacity expansion program is beginning to deliver.

The devaluation sparked a jump in inflation, which last month hit 30%, the highest level since the peak of 35.1% in June 1986. Payments to ministries have been slow to rise in line. State oil and gas firm EGPC – responsible for covering the cost of oil subsidies – saw its monthly allocation from the finance ministry rise from $800mn to $1bn. But a further hike will likely be needed given that to Oil Minister Tariq al-Mulla estimates that the cost of subsidies will hit E£65bn for the financial year ending 30 June, near-double the original pounds-terms figure (see chart). (CONTINUED - 707 WORDS)

DATA INSIDE THIS ARTICLE

table Egypt Power Projects
chart Egypt's Spending On Oil Subsidies