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The Egyptian food subsidy system: structure, performance, and options for reform

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Author Info
Ahmed, Akhter U.
Gutner, Tamar
Lofgren, Hans
Bouis, Howarth E.

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Abstract

Egypt's food subsidy system has been a mainstay of the government's long-term policy of promoting social equity and political stability. It has also been a major component of the social safety net for the poor, guaranteeing the availability of affordable staples, helping to reduce infant mortality and malnutrition, and mitigating the adverse effects of recent economic reform and structural adjustment.The cost of the system has declined considerably from 14 percent of government expenditures in 1980/81 to 5.6 percent in 1996/97. The absolute cost, however, remains high: In 1996/97,the total cost was 3.74 billion Egyptian pounds (LE)or about US$1.1 billion.The government and various stakeholders agree that the system's costs can be further reduced and its efficiency improved with better targeting to the needy. The Egyptian Food Subsidy System: Structure, Performance, and Options for Reform evaluates the economic, political, and technical feasibility of reducing costs while improving or maintaining the welfare of the poor.The report addresses five questions: (1)How well does the present system target the poor? (2)How much leakage — the pilferage of subsidized foods in the distribution channel —occurs? (3)At what cost does the government transfer income to the needy? (4)How can subsidies be better targeted to the needy?and (5)What are politically feasible options for reform?

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Paper provided by International Food Policy Research Institute (IFPRI) in its series Research reports with number 119.

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Date of creation: 2001
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Handle: RePEc:fpr:resrep:119

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Related research
Keywords: Subsidies Government policy Egypt.; Food prices Government policy Egypt.; Welfare economics.; Poverty Egypt; Food relief Egypt.;

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References listed on IDEAS
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  1. Bouis, Howarth E. & Haddad, Lawrence J., 1992. "Are estimates of calorie-income fxelasticities too high? : A recalibration of the plausible range," Journal of Development Economics, Elsevier, vol. 39(2), pages 333-364, October. [Downloadable!] (restricted)
  2. Ali, Sonia M. & Adams, Richard Jr, 1996. "The Egyptian food subsidy system: Operation and effects on income distribution," World Development, Elsevier, vol. 24(11), pages 1777-1791, November. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Cassing, James & Nassar, Saad & Siam, Gamal & Moussa, Hoda, 2007. "Distortions to Agricultural Incentives in Egypt," Agricultural Distortions Working Paper 48511, World Bank. [Downloadable!]
    Other versions:
  2. Henning Tarp Jensen & Sherman Robinson & Finn Tarp, 2004. "General Equilibrium Measures of Agricultural Policy Bias in Fifteen Developing Countries," Discussion Papers 04-25, University of Copenhagen. Department of Economics. [Downloadable!]
    Other versions:
  3. Kherallah, Mylene & Lofgren, Hans & Gruhn, Peter & Reeder, Meyra M., 2000. "Wheat policy reform in Egypt: adjustment of local markets and options for future reforms," Research reports 115, International Food Policy Research Institute (IFPRI). [Downloadable!]
  4. Farrar, Curtis, 2000. "A review of food subsidy research at IFPRI," Impact assessments 12, International Food Policy Research Institute (IFPRI). [Downloadable!]
  5. Coady, David P., 2004. "Designing and evaluating social safety nets," FCND discussion papers 172, International Food Policy Research Institute (IFPRI). [Downloadable!]
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