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Egypt will not raise cost of subsidised bread after diesel increase, supply minister states

Egypt will not raise the price of its greatly subsidised bread, set at 20 piastres per loaf, even after diesel prices have actually increased, Supply Minister Sherif Farouk stated in a statement on Thursday.

Egypt, one of the world's greatest wheat importers, raised the cost of subsidised bread by 300% in June for the first time in years, a politically delicate decision that had been postponed for several years.

The minister's remarks followed the federal government raised the prices of a wide range of fuel products earlier on Thursday, including gasoline and diesel, among the most typically used fuels. Both are used in the production process of bread.

The federal government raised fuel rates four days before the International Monetary Fund (IMF) conducts a 3rd evaluation of its broadened $8 billion loan programme for the country. Slashing aids belongs to the contract.

The state will continue to bear the distinction in production expenses, if any, and pay them to pastry shop owners through the General Authority for Supply Commodities (GASC), Farouk included.

About two-thirds of Egypt's population benefit from a. programme that provides 5 round loaves of bread daily at. the subsidised price. An attempt to alter the aid system. resulted in riots in 1977.

(source: Reuters)