Can bread subsidies continue in their present form?

Some 500 political activists and textile workers were arrested and dozens of others injured during clashes with police in the Nile Delta city of Al-Mahalla Al-Kobra on 6 April in protests over high bread prices, said eyewitnesses.

[Read this report in Arabic]

According to the 8 April edition of Al-Masri Al-Yom newspaper, a 15-year-old boy was killed in the riots, in the area around the Ghazl El-Mahalla factory.

The Egyptian government is struggling to tackle acute shortages of subsidised bread amid rising world food prices.

Bread is central to Egyptian life and the Egyptian diet - reflected in the fact that colloquial Arabic uses the word `aish’ (life) rather than the standard Arabic `khobz’.

In recent weeks, long queues in front of bakeries have led to violence mainly in Cairo’s impoverished neighbourhoods. Schoolchildren have been sent by their parents to queue for hours to buy the staple - and missed school as a result.

According to security sources, since early February at least 11 people have died in bread queues from exhaustion, and two were stabbed when fights broke out between customers vying for places in the queue.

However, World Food Programme (WFP) Deputy Country Director Ayoub al-Jawaldeh said there was no need for the WFP to step up food supply operations. “Last month when the bread crisis hit, the government immediately increased resources for the subsidy programme from US$3.6 billion to US$6 billion. Egypt is a middle-income country and the sixth largest exporter of natural gas in the world. They have their own resources to deal with the crisis,” he said.

He added: “We were told by the government not to talk about the bread crisis, as this is a very sensitive issue.”

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Subsidy system needs overhaul?

According to Tarek Selim, professor of economics at the American University in Cairo (AUC), the problem is that “government-subsidised bread can be bought by anyone. You find a lot of people who are not really poor who buy it for profit. So when poor people come to the bakery they don’t find bread. If they do find it, they find it at higher prices and it becomes scarce. The system is completely out of control.”

For years, Egyptians could buy a loaf of subsidised traditional ‘baladi’ bread at 5 piastres, while a bigger and better quality `baladi’ was sold at 10-25 piastres. Today, unsubsidised bread can sell for 10-12 times the subsidised price, which only the relatively wealthy can afford.

At most of Cairo’s bakeries a person is only allowed to spend one Egyptian pound (18 US cents) to get 20 loaves of the subsidised flat round bread - not a lot for large extended families.

“This is not enough to feed my family. I now have to buy wheat flour to bake bread at home because I cannot buy the expensive bread. But two years ago, 50 kilos of wheat cost 45 Egyptian pounds. Now, the same amount is 140 or 160 pounds,“ said Ramadan Mohammed Ibrahim, a father of nine from Cairo’s Giza suburb who works as a technical helper at the AUC on a monthly salary of 1,500 Egyptian pounds.

The current bread crisis has put the government under enormous pressure to establish a new system to regulate the sale of subsidised bread and improve food security. According to the WFP, Egypt is a food-deficit country, with 19.6 percent of the population - about 14 million people - living below the poverty line of less than US$1 a day.


Photo: Martina Fuchs/IRIN
Bread is called ‘aish’ in colloquial Egyptian Arabic, which literally means 'life', rather than the word ‘khobz’ used in standard Arabic

Corruption

Maurice Saade, an agricultural policy officer at the regional UN Food and Agriculture Organization (FAO) office in Cairo, said the main problem was that bakeries buy wheat flour at subsidised rates from the government but sell it at high prices on the black market.

For Said Yusif from Monoufyia Province, the thriving black market is a consequence of corruption and favouritism in the subsidy system. “Subsidised wheat is smuggled and sold on the black market. The owners of the subsidised bakeries conspire with government inspectors and sell our subsidised bread to private-owned bakeries. This affects the other bakeries and people without connections cannot buy their staple,” he said.

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