{"id":542524,"date":"2022-01-02T04:09:31","date_gmt":"2022-01-02T04:09:31","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/"},"modified":"2022-01-02T04:09:31","modified_gmt":"2022-01-02T04:09:31","slug":"out-with-the-in-kind-in-with-the-banknotes","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/","title":{"rendered":"Out with the in-kind, in with the banknotes"},"content":{"rendered":"<p><a class=\"content-anchor\" id=\"tldr-story-07\"><\/a> <strong>Farmers could soon be getting <\/strong><strong>cash <\/strong><strong>subsidies for fertilizers instead of in-kind <\/strong><strong>subsidies<\/strong>, after President Abdel Fattah El Sisi called for the switch last week at the inauguration of expansions to the Kima 2 ammonia and urea industrial complex in Aswan (<a href=\"https:\/\/www.youtube.com\/watch?v=RUCWquEHx_g\">watch, runtime: 21:20<\/a>). The move away from in-kind subsidies could end the parallel market trade in fertilizers, while providing farmers with the direct liquidity to buy their fertilizers would help factories better assess local market needs before earmarking for exports, El Sisi said. The president also urged farmers to adopt modern irrigation systems, which slash fertilizer consumption needs by 40-50%.<\/p>\n<p><strong>This comes as fertilizer prices surge on the back of global commodity costs. <\/strong>The government gave <a href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/9dc7bcd9-bdf0-4f63-9d57-ea812e67dd90\">producers the green light<\/a> in December to hike prices at which they sell subsidized urea fertilizers to farmers by 50% to EGP 4.5k per ton. The increase comes shortly after the government raised natural gas prices for industry, hiking rates by up to 28% for businesses including fertilizers, iron and steel, petrochemical, and cement makers.<\/p>\n<p><strong>Analysts give the move a thumbs up:<\/strong> The president\u2019s directives will \u201cput an end to the black market and ensure that the subsidy reaches those in need,\u201d CI Capital said in a report on 29 December. The move could also cut down on the overuse of nitrogen fertilizer, \u201cwhich in Egypt is &gt;4x the global average,\u201d the investment bank said.<\/p>\n<p><strong>The move is consistent with the Sisi administration\u2019s general policy direction for subsidies:<\/strong> Back in 2017, the Supply Ministry <a href=\"https:\/\/enterprise.press\/stories\/2017\/07\/13\/supply-ministry-to-halt-subsidizing-flour-for-subsidized-bread\/\">ended subsidies on flour<\/a> used to produce subsidized bread to put an end to fraud that saw the flour traded on the black market. The ministry instead subsidizes only the price of the final loaves. The government also drafted a new Cash Subsidies Act <a href=\"https:\/\/enterprise.press\/stories\/2019\/07\/07\/government-to-send-cash-subsidies-act-to-parliament-next-week-4\/\">in mid-2019<\/a> to govern a new system of direct money transfers instead of the current setup of in-kind subsidies using ration cards. The new system is designed to be more efficient and streamlined, while cutting down on subsidy fraud. The Takafol and Karam social welfare programs, launched in 2015, <a href=\"https:\/\/www.worldbank.org\/en\/news\/feature\/2018\/11\/15\/the-story-of-takaful-and-karama-cash-transfer-program\">pioneered the idea in Egypt<\/a> by providing cash subsidies directly to qualified beneficiaries.<\/p>\n<p><strong>El Sisi ordered a rework of the subsidy system several times last year<\/strong>, including calling for <a href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/05c9f0e9-8d6d-49b5-b9c7-35143427e1a8\">the introduction of a modernized, digitized<\/a> ration card program, which he said would help end the large-scale misallocation of welfare subsidies.<\/p>\n<p><strong>Also rising: Sugar prices. The government has hiked prices at which it sells sugar by <\/strong><strong>almost 25%<\/strong> in response to rising international prices. A kilo of sugar will now be sold at EGP 10.50, up from EGP 8.50, <a href=\"https:\/\/www.almasryalyoum.com\/news\/details\/2493386\">Al Masry Al Youm<\/a> quoted Supply Minister Ali El Moselhy as telling reporters last week. International prices of raw sugar have surged some 57% since 1H2020, Prime Research wrote in a note last week.<\/p>\n<p><strong>The move will have a noticeable impact on inflation<\/strong>, according to analysts at CI Capital in a note last week. They expect the rising prices of sugar to add another 0.15 percentage points onto the headline rate.<\/p>\n<p><strong>SMART POLICY- Could we see higher piped water prices soon?<\/strong> The government has wrapped a feasibility study on reworking piped water consumption tiers for both residential and non-residential use, which Prime Minister Moustafa Madbouly reviewed last week, according to a <a href=\"https:\/\/www.facebook.com\/EgyptianCabinet\/posts\/305917054912055\">cabinet statement<\/a>. The statement doesn\u2019t provide further details on what the restructuring would look like, or how much we can expect prices to increase. Piped water prices were last <a href=\"https:\/\/enterprise.press\/stories\/2018\/06\/03\/govt-raises-piped-water-prices-by-up-to-46-5\/\">raised in 2018<\/a>, when the government hiked prices across all consumption tiers by up to 46.5%.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Farmers could soon be getting cash subsidies for fertilizers instead of in-kind subsidies, after President Abdel Fattah El Sisi called for the switch last week at the inauguration of expansions to the Kima 2 ammonia and urea industrial complex in Aswan (watch, runtime: 21:20). The move away from in-kind subsidies could end the parallel market [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":542525,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8507],"tags":[96,97,72,99,100,98],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-542524","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-policy","tag-abdel-fattah-el-sisi","tag-agriculture","tag-enterpriseam","tag-fertilizers","tag-policy","tag-subsidies","wpautop","entry"],"acf":{"mongo_id":"dcfef757-7373-404b-8b61-b6cdf0786ae2","is_powered_by":true,"story_type":"1","photo_url":"https:\/\/ent.news\/2022\/1\/7.jpg","photo_position":"above","related_issue":[542511],"teaser":"","voice_url":""},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.1 (Yoast SEO v27.1.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Out with the in-kind, in with the banknotes - EnterpriseAM Egypt<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Out with the in-kind, in with the banknotes\" \/>\n<meta property=\"og:description\" content=\"Farmers could soon be getting cash subsidies for fertilizers instead of in-kind subsidies, after President Abdel Fattah El Sisi called for the switch last week at the inauguration of expansions to the Kima 2 ammonia and urea industrial complex in Aswan (watch, runtime: 21:20). The move away from in-kind subsidies could end the parallel market [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/\" \/>\n<meta property=\"og:site_name\" content=\"EnterpriseAM Egypt\" \/>\n<meta property=\"article:published_time\" content=\"2022-01-02T04:09:31+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/i0.wp.com\/ent.news\/2022\/1\/7.jpg?fit=%2C&ssl=1\" \/>\n<meta name=\"author\" content=\"enterpriseam admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"enterpriseam admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/\"},\"author\":{\"name\":\"enterpriseam admin\",\"@id\":\"https:\/\/enterpriseam.com\/egypt\/#\/schema\/person\/ca597032db7e4db868359c123cec256d\"},\"headline\":\"Out with the in-kind, in with the banknotes\",\"datePublished\":\"2022-01-02T04:09:31+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/\"},\"wordCount\":586,\"publisher\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/#organization\"},\"image\":{\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/i0.wp.com\/ent.news\/2022\/1\/7.jpg?fit=%2C&ssl=1\",\"keywords\":[\"Abdel Fattah El Sisi\",\"agriculture\",\"EnterpriseAM\",\"fertilizers\",\"policy\",\"subsidies\"],\"articleSection\":[\"Policy\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/\",\"url\":\"https:\/\/enterpriseam.com\/egypt\/2022\/01\/02\/out-with-the-in-kind-in-with-the-banknotes\/\",\"name\":\"Out with the in-kind, in with the banknotes - 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Construction of the nine-plant phosphate-based fertilizer complex is reportedly 98% complete. El Sisi met Guido Kerkhoff, CEO of Thyssenkrupp,\u2026","rel":"","context":"In &quot;Manufacturing&quot;","block_context":{"text":"Manufacturing","link":"https:\/\/enterpriseam.com\/egypt\/category\/industries\/manufacturing\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":652652,"url":"https:\/\/enterpriseam.com\/egypt\/2017\/01\/16\/agriculture-ministry-raises-price-of-subsidized-fertilizer-to-egp-2959-per-tonne\/","url_meta":{"origin":542524,"position":1},"title":"Agriculture Ministry raises price of subsidized fertilizer to EGP 2,959 per tonne","author":"enterpriseam admin","date":"16 January 2017","format":false,"excerpt":"The Agriculture Ministry has raised the price of subsidized fertilizer to EGP 2,959 per tonne from EGP 2,000, a 48% price hike, Ahram Gate reported. The decision was based on an average FX rate of EGP 16.3 per USD and takes into account increases in production costs. Fertilizer manufacturers had\u2026","rel":"","context":"In &quot;Speed Round&quot;","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":595884,"url":"https:\/\/enterpriseam.com\/egypt\/2019\/08\/08\/el-sisi-inaugurates-large-fertilizer-complex-in-sokhna\/","url_meta":{"origin":542524,"position":2},"title":"El Sisi inaugurates large fertilizer complex in Sokhna","author":"enterpriseam admin","date":"8 August 2019","format":false,"excerpt":"President Abdel Fattah El Sisi inaugurated a new phosphate and compound fertilizer manufacturing complex at the Ain Sokhna Industrial Zone yesterday, according to a local press report. The complex is said to be the largest in the Middle East and houses nine phosphate-based fertilizer factories. It contains a water desalination\u2026","rel":"","context":"In &quot;Manufacturing&quot;","block_context":{"text":"Manufacturing","link":"https:\/\/enterpriseam.com\/egypt\/category\/industries\/manufacturing\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":601533,"url":"https:\/\/enterpriseam.com\/egypt\/2019\/03\/04\/el-sisi-meeting-with-geidco-occupies-talking-heads-also-beware-of-the-birds\/","url_meta":{"origin":542524,"position":3},"title":"El Sisi meeting with GEIDCO occupies talking heads (also, beware of the birds)","author":"enterpriseam admin","date":"4 March 2019","format":false,"excerpt":"The airwaves were awash with miscellany last night, with no single topic or story capturing the collective focus of the nation\u2019s talking heads. President Abdel El Fattah El Sisi\u2019s meeting with GEIDCO Chairman Liu Zhenya was the focus for Al Hayah Al Youm\u2019s Lobna Assal (watch, runtime: 01:13). During the\u2026","rel":"","context":"In &quot;Enterprise+: Last Night\u2019s Talk Shows&quot;","block_context":{"text":"Enterprise+: Last Night\u2019s Talk Shows","link":"https:\/\/enterpriseam.com\/egypt\/category\/enterprise-last-nights-talk-shows\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":547231,"url":"https:\/\/enterpriseam.com\/egypt\/2022\/06\/14\/not-shocking\/","url_meta":{"origin":542524,"position":4},"title":"Not shocking","author":"enterpriseam admin","date":"14 June 2022","format":false,"excerpt":"No electricity price hikes coming this July, after all: The Madbouly government will freeze electricity prices to ease financial pressure on the public, which is already coping with high inflation, President Abdel Fattah El Sisi said yesterday (watch, runtime: 3:41).Residential electricity bills were set to rise by as much as\u2026","rel":"","context":"In &quot;Energy&quot;","block_context":{"text":"Energy","link":"https:\/\/enterpriseam.com\/egypt\/category\/industries\/energy\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2022\/6\/sisi-electricity-1600x.png?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":627901,"url":"https:\/\/enterpriseam.com\/egypt\/2018\/06\/14\/el-sisi-defends-26-hike-in-electricity-prices\/","url_meta":{"origin":542524,"position":5},"title":"El Sisi defends 26% hike in electricity prices","author":"enterpriseam admin","date":"14 June 2018","format":false,"excerpt":"El Sisi defends 26% hike in electricity prices: The government spends USD 18.6 bn on subsidies to cover fuel, food and electricity, President Abdel Fattah El Sisi said on Tuesday following the announcement of an average 26% increase in next year\u2019s electricity prices,the Associated Press reports. Each family receives an\u2026","rel":"","context":"In &quot;Speed Round&quot;","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts\/542524","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/comments?post=542524"}],"version-history":[{"count":0,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/posts\/542524\/revisions"}],"acf:post":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/issue\/542511"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/media\/542525"}],"wp:attachment":[{"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/media?parent=542524"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/categories?post=542524"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/tags?post=542524"},{"taxonomy":"brand","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/brand?post=542524"},{"taxonomy":"newspack_spnsrs_tax","embeddable":true,"href":"https:\/\/enterpriseam.com\/egypt\/wp-json\/wp\/v2\/newspack_spnsrs_tax?post=542524"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}