The Egyptian government plans to reduce subsidies of petroleum products by 26% and electricity subsidies by 47% in the annual budget for the 2018/2019 fiscal year (FY), Amwal Al Ghad reported.

The government aims to cut its expenditure on subsidies by more than quarter, reducing the budget from EGP 120.926 billion to EGP 89.075 billion.

Electricity subsidies will total just EGP 16 billion in FY 2018/19 , down from EGP 30 billion in the current financial year.

The government submitted the 2018/2019 draft budget to the House of Representatives in March 2018 to be approved before the end of June.

The cost of fuel subsidies reached EGP 27.5 billion during Q2 2017/18. This figure is based on an average Brent price of $61.4 per barrel and USD exchange rate of EGP 17.63, Minister of Petroleum and Mineral Resources Tarek El Molla stated earlier in the year, Egypt Oil & Gas reported.

The cost increased by 34% during the first half of FY 2017/18, increasing from EGP 38 billion to EGP 51 billion, El Molla announced.