Inflation has eased slightly from record highs last year but is still running at over 30%
CAIRO – President Abdel Fattah al-Sisi told Egyptians on Wednesday they were still able to eat and drink despite soaring prices as he defended mega-projects he said provided millions of jobs.
Egypt’s long-running foreign currency shortage risks deepening because of lost revenues from the Suez Canal, and this month has triggered store closures and new restrictions on credit card withdrawals.
Inflation has eased slightly from record highs last year but is still running at over 30%.
Sisi blamed the lack of foreign currency on Egypt’s decades-old import dependency, which he said required spending of $1 billion a month on staples like wheat and vegetable oils and another $1 billion on fuel.
“We present services to the Egyptian people in Egyptian pounds, and have to pay for them in dollars,” he said in comments to mark national police day in Cairo.
“Don’t we eat? We eat. Won’t we drink? We drink, and everything is functioning. Things are expensive and some things are not available? So what?” Sisi said.
“They tell me that life is expensive, I tell you that even if it’s expensive, we are living. If we can bear with it, we will live, we will grow, and we will overcome this problem.”
Egypt is trying to revive and expand a $3 billion programme with the International Monetary Fund. But in order to do so is under pressure to let its currency float and carry out structural reforms that include reducing the role of the military and the state to make space for the private sector.
The government is faced by a steep repayment schedule on a debt burden that has surged in recent years as Egypt has embarked on costly mega-projects including a new capital city under construction east of Cairo.
“We were told by economists that we need deep austerity measures in our economy, and this is not a secret,” said Sisi.
“And that we should halt grand projects, and this economic view may be sound, but to that I say: I employ 5-6 million people, tell me … how could we shut all this down?”
Source: Zawya
