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World Bank
Middle East and North Africa | Egypt, Arab Republic of
2012-03-19T10:24:34Z | 2012-03-19T10:24:34Z | 2010-09-16

Egypt's food subsidies, important for ensuring political stability, do not target specific groups. The subsidies were introduced during Second World War and have never been targeted. Egyptians seem to perceive food subsidies as the most concrete benefit they receive from government spending. Seen as an entitlement, food subsidies are politically sensitive. Section two gives the historical background of the food subsidy system and discusses past and planned food subsidy reforms, section three analyzes the geographical allocation of subsidized food items and how the allocation corresponds to population and poverty distribution, and section four analyzes household participation in food subsidies by income group and geographic region. Section five uses all this information to measure the cost of subsidies that do not reach intended consumers, or the system leakage, and the potential cost savings from excluding the richest groups from food subsidies. In section six, the key findings are summarized and a vision for long-term reforms is outlined.


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