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UPDATE 2-Egypt sets $18 bln for subsidies in FY 2017-18 budget
June 5, 2017 / 11:22 AM / 4 months ago

UPDATE 2-Egypt sets $18 bln for subsidies in FY 2017-18 budget

(Recasts with total subsidy bill, adds PM comments)

CAIRO, June 5 (Reuters) - Egypt has set a total subsidy bill of 330 billion Egyptian pounds ($18.23 billion) in its budget for the 2017-18 fiscal year beginning in July, Prime Minister Sherif Ismail said on Monday.

The amount covers fuel subsidies, which will cost 145 billion pounds ($8 billion) and 80 billion pounds for electricity, the government said in a statement.

The cost of fuel imports has soared since Egypt floated its pound currency in November, prompting it to halve in value against the dollar within weeks.

The government spent 78 billion pounds on fuel subsidies in the first nine months of the 2016-17 fiscal year, up from 41 billion in the same period of the previous year.

Ismail told reporters the 330 billion pound figure also included food subsidies but did not say how much exactly would be spent on food.

In November, Egypt signed a $12 billion, three-year International Monetary Fund loan deal tied to sweeping economic reforms including subsidy cuts.

The IMF said last month it supported a plan for Egypt to remove fuel subsidies entirely within three years but that the timing of any price hike was up to the government.

The government has not yet set a timeline for the next round of price increases.

$1 = 18.1000 Egyptian pounds Reporting by Eric Knecht; Editing by Ahmed Aboulenein and Mark Heinrich

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