Egypt Approves Allocation of $US 2.48 Billion to Social Aid Program

Egypt announced on Monday multiple decisions to alleviate the financial burden affecting the low and middle-income families from the economic reform program.

Egypt’s government approved to spend EGP 45 billion ($US 2.48 billion) on increased pensions that will benefit around 100 million citizens, bonuses for public employees and increased subsidies, according to Minister of Social Solidarity Ghada Wali.

The inflation rate in Egypt has reached unprecedented levels after it had jumped in April to its highest rates in 30 years, recording 30.2 percent.

Prices in Egypt have soared after the Egyptian government had announced in November the liberation of its currency rate against all foreign currencies, resulting in the high rates of inflation.

The new budget that will be poured into the social aid program aims at helping citizens to counter the rise of cost of living, according to a statement released by the Ministry of Finance.

The flotation decision had an impact on nearly all the products, resulting in significant price hikes and high rates of inflation.

Minister of Finance Amr Al-Garhy expected earlier this month that rates of inflation will decrease by November and December 2017.

Monday’s decision was taken in line with the orders of President Abdel Fattah Al-Sisi to ward off the burden of high prices on low and middle-income people.

In 2016, Egypt started applying the Value Added Tax (VAT), and the subsidies of oil products were partially cut. It is expected that oil subsidies will further reduce in July.

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