May 29, 2018 / 2:43 PM / 3 months ago

UPDATE 2-Egyptian officials arrested on suspicion of taking bribes from commodity firms

* Food supply firms paid over $100,000 in bribes - MENA

* Arrested FIHC head is former military general

* Latest corruption case to hit Egypt’s commodity sector (Adds details of those arrested, context)

CAIRO, May 29 (Reuters) - Four Egyptian officials including the chairman of the state Food Industries Holding Company (FIHC) have been arrested on suspicion of taking bribes from commodities trading firms, state news agency MENA reported on Tuesday.

The others are a supply ministry adviser responsible for coordination with parliament, a supply ministry spokesman and an official in the FIHC chairman’s office, according to MENA.

The exact nature of the alleged bribes was not immediately clear and officials at the supply ministry were not immediately available for comment.

Alaa Fahmy, a former military general, is the chairman of FIHC, a state buyer that has historically handled a broad sweep of commodities, tendering locally and internationally for staples like vegetable oils and sugar, but which in recent years has seen its role reduced in favour of state grain-buyer GASC.

The trading companies were not named but described as “major suppliers of food commodities” by MENA. It said the bribes exceeded 2 million Egyptian pounds ($112,000) and were given to officials in return for help in facilitating “purchase orders” and “payments of dues”, without providing further details.

Egypt is the world’s largest importer of wheat and a major buyer of staples like corn and vegetable oils.

GASC, which falls under the supply ministry, spends over $1.5 billion on imported wheat annually to supply a sprawling bread subsidy programme which is politically sensitive for its role feeding tens of millions of low-income Egyptians.

MENA said the individuals arrested would be sent to the public prosecutor.

A parliamentary inquiry in 2016 found that up to 2 million tonnes of Egyptian wheat procured by the supply ministry existed only on paper, a controversy that pushed then-supply minister Khaled Hanafi to resign and the country to scrap a wheat subsidy it had long provided to farmers.

A Reuters investigation last year uncovered an elaborate system of bribery that grains traders used to guarantee that wheat cargoes would pass Egypt’s tough import inspections.

Reporting by Ali Abdelaty, Maha El Dahan and Eric Knecht; editing by Andrew Roche

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