Egyptians spend high during Ramadan

The monthly foodstuff consumption of Egyptians amounts to EGP 60 billion (Photo: by Shutterstock)

Egyptians consumed EGP 120 billion worth of foodstuff during Ramadan, writes Ahmad Abdel-Rahman.

First assistant Minister of Supply for Investment and head of the Internal Trade Development Authority (ITDA), Ibrahim Ashmawy affirmed that the changes taking place in the world point to a new global economy, particularly in light of the continuing implications of the corona crisis. This prediction is based on the level of inflation in prices, the slowdown in supply chains, the decline in production rates, and the increase in freight and energy prices globally.

Ashmawy stated this during a symposium of the Egyptian-Lebanese Businessmen Association under the title "Global economy to where? The vision of the private sector to deal with new economic challenges", which was held on February 15, 2022 in Cairo.

Ashmawi said that traditional trade, through various supply chains, starting with the corona pandemic, has completely changed and a very large global e-commerce volume has begun. Ashmawy added that the trade sector contributes 19 per cent of the global output, which is estimated at USD 93 trillion, the share of goods trade is USD17 trillion, and trade in services USD 5 trillion.

He also pointed out that the trade sector in Egypt was affected by the corona crisis, and its contribution to global output decreased by 12 per cent in 2020 and by nine per cent in 2021. Ashmawy indicated that the Egyptian internal trade sector is a strategic and pivotal file to drive economic growth. He also noted that the sector's contribution rose after the corona crisis from 14 per cent to 17 per cent of gross domestic product (GDP).

In this context, the Ministry of Supply and Internal Trade have written that the volume of e-commerce in Egypt has grown significantly since the beginning of the pandemic, with total payments of about USD 25 billion. The volume of purchases with credit cards and prepayments also jumped from USD 3.6 billion to USD 4.9 billion last year. This increase was made through electronic platforms and prepayments other than cash.

The Ministry of Supply also noted that the government succeeded, in light of the corona crisis, in increasing the reserve of stocks of food and strategic commodities so that six months of consumption was covered. As a result, the markets were not affected by a shortage of any commodity.

Ashmawy confirmed that the monthly foodstuff consumption of Egyptians amounts to EGP 60 billion, and doubles in the month of Ramadan (The Holy month of fasting) to EGP 120 billion. This means that the purchase of food would amount to approximately EGP 700 billion of annual expenditure.

He also said that the latest report from the Fitch International Credit Rating Agency on Egypt showed that spending would increase from EGP 2.1 trillion last year to an expected EGP 2.7 trillion in 2022. This figure is equivalent to a third of Egyptians' savings - which amounts to about EGP 6.2 trillion.

Ashmawy has noted that the fuel subsidy allocations amounted to EGP 321 billion last year, and the food subsidy bill amounted to EGP 89 billion. He also said that the total number of beneficiaries of the subsidy is 64,000,000 citizens, receiving either the conditional commodity or monetary subsidy.

There are also about 72,000,000 citizens who benefit from subsidizes on a loaf of bread. But this compares to 74,000,000 citizens who benefited from the subsidy before the database in the Ministry was filtered.

For his part, the secretary-general of the Egyptian-Lebanese Association of Businessmen, Alaa Al-Zuhairi, stressed the need to develop scenarios to deal with the challenges that occur in the global economy as a result of the repercussions of corona and its effects on inflation, which includes stagnation and global price hikes. Al-Zuhairi stressed that the Egyptian economy can overcome these challenges and maintain the growth rates it has already achieved.

Al-Zuhairi said: "Despite what is happening globally, the Egyptian economy has proven its ability to confront and absorb crises as a result of bold economic reforms and national development projects that helped sustain growth. The main challenge remains the sustainability of growth and its repercussions on citizens' lives."

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Saturday, 28 May 2022