The Madbouly government has activated a package of temporary preemptive and social measures, according to a cabinet statement. With this high-stakes intervention, the government hopes to lock down essential energy supplies, keep the economic engine running, and shield the domestic market from the worst shockwaves of an unpredictable global crisis.

IN CONTEXT- This came only hours after the government raised fuel prices, a move it felt it needed to re-justify in yesterday’s weekly press conference — it was a necessity driven by international pressures. Prime Minister Mostafa Madbouly explained that while the state previously held fuel prices steady, the cost of a barrel of oil globally surged by 50%, rising to around USD 93 / bbl from USD 61.3. State institutions and financing bodies simply could no longer fully absorb the staggering global price shocks on their own.

Despite the increases at the pump, Oil Minister Karim Badawi argued that the public is only asked to share a portion of the burden. The state is still shouldering bns in subsidies, including roughly EGP 30 bn specifically for butane cylinders. The state will also absorb the EGP 1.6 bn annual increase in bread production costs resulting from the fuel hikes, pushing the total annual bread subsidy bill to EGP 160 bn while keeping subsidized bread prices completely unchanged, Supply Minister Sherif Farouk said.

Leading by example: Before asking the public to tighten their belts, the government is tightening its own. An immediate, sweeping austerity mandate is now active across all state entities to drastically slash public spending. Budgets are being reprioritized: authorities are freezing non-urgent expenditure, stripping away advertising and conference funds, and severely restricting official travel.

Extending to energy use: A strict mandate is now in place to ration electricity across public buildings and streets, while state projects heavily reliant on diesel, fuel oil, and gasoline are undergoing operational reviews to slash fuel bills.

Social measures on the table

Minimum wage hike on the horizon: To further offset the rising cost of living, the government is gearing up to raise the minimum wage for state employees starting next fiscal year. We were told earlier this month to expect a minimum wage of EGP 8k. Finance Minister Ahmed Kouchouk promised that the upcoming raise — set to be announced next week — will be substantial and “significantly outpace inflation rates.”

More social safety net measures: The government is also injecting EGP 20 bn to extend heightened payouts for an additional two months, directly targeting Takaful and Karama beneficiaries alongside ration card holders.

Beyond domestic belt-tightening

The hunt for hard currency: The government is moving to shore up its foreign exchange liquidity. Foreign Minister Badr Abdel Ati said the government is lobbying international heavyweights — including the US, EU, World Bank, and other major development banks — to fast-track scheduled loans and concessional financing. Coupled with a renewed push to attract foreign direct investment and expand the state IPO program, Abdel Ati expects “tangible results” within weeks.

What’s next? Prime Minister Madbouly was clear: these are temporary band-aids, not permanent policies, and they will be reviewed the moment this global storm passes. The ultimate endgame hasn’t shifted — the state remains focused on crushing inflation and maintaining a flexible exchange rate. It’s all about ensuring the market has the hard currency it needs to keep the country’s production lines humming.

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