Gasoline and diesel consumption down 2-3%, subsidy bill hits LE 110B



Thu, 12 Apr 2018 - 03:10 GMT


Thu, 12 Apr 2018 - 03:10 GMT

FILE – Finance Minister Amr El-Garhy

FILE – Finance Minister Amr El-Garhy

CAIRO – 12 April 2018: Gasoline and diesel consumption declines for the first time this year by 2 to 3 percent, compared to the rise of 4 percent during latest years, Minister of Finance Amr el-Garhy said.

The minister attributed this decrease to pricing, saying that the proper pricing to any commodity rationalizes its consumption.

The price of oil in the new budget is set at $67 per barrel, Garhy said in a press conference, pointing out that the subsidy bill reached LE 110 billion.

The minister clarified that the subsidy cut necessarily needs an application of a social protection program, adding that the energy sector is under a lot of pressure because of the subsidy which appears on the energy loans.

Concerning the latest issuance of Eurobond, Garhy said that it was successful and that the European investor turnout reached 60 percent, American investor turnout marked 25 percent, and the Arab investor turnout amounted to 25 percent.

He said that rise in the demand for these bonds also contributed to the reduction of the reference price of the repayment period from 5 percent to 4.75 percent for the maturities of eight years.

About the assets’ sovereign wealth fund, Garhy said that this fund aims to consolidate and make use of the state’s unused assets in order to create new investment opportunities.

Planning Minister Hala al-Saeed stated that the government approved on Wednesday April 11, a draft law to establish a sovereign wealth fund that aims to manage and make use of the state’s assets with a capital of LE 200 billion.

Egypt will offer shares in four to six companies by the end of 2018, the minister said.

Egypt selected 23 state companies for the first phase of the state IPO program. A Finance Ministry statement said in March that the market value of the soon-to-be-listed companies stands at LE 430 billion, adding that the government intends to float about 15-30 percent of the companies on the Egyptian Exchange (EGX).

This comes as part of the state program to float some state-owned companies on the EGX under a five-year program announced in 2016 to attract investment and invigorate the stock market.

The first phase of the program will include five companies in the petroleum sector, including Enppi, Assiut Oil Refining Co (ASORC) and Alexandria Mineral Oils Company (AMOC), six companies in the petrochemicals sector, including Sidi Kerir Petrochemicals Co and the Egyptian Ethylene And Derivatives Company and three companies in the logistics sector.

As for financial services, the listing will include the Housing and Development bank, Bank of Alexandria, Banque Du Caire, e-finance and Misr Insurance companies, according to the statement.

The real estate sector will have two companies listed, while the customer services and industry sectors will each have one company listed.



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