Finance Ministry considers alternatives for financing wheat imports

The Ministry of Finance denied any intention to impose new taxes or borrow from abroad to create additional financial resources for the import of wheat. Global prices of wheat are on the rise recently.  

An official at the Finance Ministry told Al-Masry Al-Youm that the government plans to solve the wheat crisis using the 2010/11 general budget reserve. The official refused to specify the magnitude of the reserves, which are maintained to deal with exceptional situations.

Rachid Mohamed Rachid, Minister of Trade and Industry, demanded from Youssef Botros-Ghali, Minister of Finance, LE2.5-4 billion in additional financial resources to face the global wheat price hike, after Russia placed a ban on wheat exports.

The Finance Ministry source, who wished to remain anonymous, said it was early to depend on the general budget reserve, as some LE13.5 billion in subsidies allocated for supply commodities are included in the general budget.

The source added: “If the crisis lasts until the end of the year, we will propose a draft law to parliament to create additional resources for wheat imports, which is the last probable scenario.”

The Finance Ministry allocated money to the Supply Commodity Authority to import around half a million tons of wheat, which has resulted in increasing the quantity of wheat available on the local market to three million tons.

Translated from the Arabic Edition.

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