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Here We Go Again

By admin • Jul 8th, 2008

Egypt’s population is currently estimated at 80 million, and rising fast. The country is already the world’s largest importer of wheat, bringing in 55 percent of the 14 million tons it consumes every year. But while rising domestic demand for unbleached flour, which lies at the heart of Egyptians’ diets, partially explains the bread shortage, there are also international dynamics at play. The UN’s global food price index, for instance, has shot up 34 percent since 2005.

With oil topping $130 a barrel, rising energy costs are another factor, according to Heba Kandil of the UN World Food Program. Higher oil prices have made it profitable to switch over farmland from food production, to growing crops to make biofuels. Populous developing nations such as China and India have boosted demand, while droughts in several food exporting countries forced them to cut supply.

Food expenditures, whether from the Egyptian treasury or the consumer’s pocket, are higher than ever and set to keep rising. While many contend that the wealth from Egypt’s economic growth is not trickling down, the effects of the food crisis seem to be trickling up.

“The new face of hunger in Egypt is not limited to the very poor, but also means more middle class families are changing their eating habits, skipping meals or cutting out more nutritious foods like meat and dairy,” says Kandil.

Looking forward. It seems unlikely that price pressure on the government and consumers will drop off anytime soon. Boxed in by rising subsidy expenditures and a public hit by inflation, the government will keep exploring ways to reform the subsidy system, to cut costs without arousing anger.


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