Egypt will reduce spending on fuel subsidies by nearly 43% in the 2016/17 budget due mainly to lower global energy costs, officials told Reuters.
Finance Minister Amr al-Garhy told a news conference that state energy subsidies would fall to EGP35b ($3.94b) from about EGP61b in the 2015/16 budget. The deputy finance minister for fiscal policy added that a decline in international oil prices would account for the bulk of the reduced subsidy spending in the next fiscal year, according to Daily Star.
The government has been trying to cut subsidies, which eat up a big chunk of the budget, however, in mid-2014, attempts to make cuts were met with anger by consumers as the measure caused domestic prices of natural gas, diesel, and other fuels to rise by as much as 78%.
Meanwhile, President Abdel Fattah al-Sisi has already approved a draft state budget that reduces the budget deficit in the 2016/17 fiscal year to 9.8% of gross domestic product (GDP) from the current 11.5%.