Finance Ministry officials and representatives from the General Petroleum Corporation are currently discussing the amount of funding required to continue subsidizing petroleum commodities — gas, petrol, fuel and diesel — in the 2013/14 fiscal year. They intend to keep them at the same levels of the current fiscal year, or about LE130 billion, said a government source.
Technical studies are underway to assess reserves, direct and indirect costs, partner shares and the impact of the reduction of subsidies on these commodities in the marketplace, said the official, who declined to be named.
The amount of funds to be used to support the subsidies will be determined by the EGPC, which will present its recommendation to the Finance Ministry to include in the draft budget for the next fiscal year, the source continued.
He expected this to happen within the next 10 days.
Due to the tense atmosphere in the streets and ongoing clashes, it may not be a good time to apply a system of coupons or smart cards to distribute gasoline, butane and diesel, the official conjectured, despite the fact that the government had already proposed to start applying the coupon system last October, and then again last December.
The source noted that the Finance Ministry funds more than 75 percent of imported petroleum products. The current fuel shortage is due to the selling of these goods on the black market, the source said.
No extra funds can be allocated to petroleum commodities without legislative approval, the official continued. The state is currently looking to use treasury bills and bonds as a funding source, he added.
Edited translation from Al-Masry Al-Youm
