New Governmental Initiative Aims to Reduce Prices of Basic Commodities

In a bid to address the increasing prices of essential goods, the Egyptian government, in collaboration with the Central Bank of Egypt (CBE), is set to announce an initiative next week aimed at reducing the prices of basic commodities. Prime Minister Mostafa Madbouly discussed the step with industry representatives, including heads of commerce chambers, food companies, and vendors, in a meeting attended by key officials, including CBE Governor Hassan Abdallah.

“We will work together to guarantee an ample supply of different goods in the Egyptian market in a way that contributes to decreasing the prices, particularly prices of food goods,” stated Dr. Mabouly.

The government will work in coordination with the CBE to secure the necessary US dollars for procuring goods and explore solutions to alleviate the prices of essential commodities.

The local market has witnessed a steady increase in prices, including those of food staples. The government attributes this rise to the disruptions caused by the Russian-Ukraine war and the lingering effects of the COVID-19 pandemic on the global supply chain.

Egypt's annual headline inflation reached a record high of 39.7 percent in August, with food and beverage prices experiencing a monthly inflation rate of 2.2 percent. Vegetable prices, in particular, surged by 24.4 percent in August alone. Year-on-year, food and beverage prices rose by a staggering 71.9 percent, while housing and restaurant services saw an annual inflation rate of 49.5 percent.

The World Bank estimates that Egypt's inflation will average 32.3 percent in 2023, significantly higher than the 5.2 percent and 5 percent recorded in 2021 and 2020, respectively.