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End of Sugar ‘Crisis’? Egypt Cancels Import Tariffs on Sugar to Boost Supplies

End of Sugar ‘Crisis’? Egypt Cancels Import Tariffs on Sugar to Boost Supplies

pablo-sugar

Egypt’s Ministry of Supply announced on Friday that it has taken steps to cancel tariffs on imported sugar in an attempt to boost supplies and lower the price of subsidized sugar.

The tariffs on imported refined sugar were increased in February 2016 to 20 percent from 10 percent. Meanwhile, raw sugar tariffs were increased also increased in the same month to 20 percent from just two percent.

It is unclear whether the Minister, who was speaking at a cabinet press conference in response to the recent floating of the Egyptian Pound, meant that all tariffs were cancelled or whether the tariff was simply rolled back to pre-February 2016 rates.

A ‘sugar crisis’ hit Egypt over the last few weeks, with the Ministry of Supply increasing the price of subsidized sugar sold through ration cards by 40 percent, reaching EGP 7 per kilogram from EGP 5. Ration cards are used by the majority of the Egyptian population to purchase subsided goods.

“The global rise in sugar prices and the decision by traders to halt imports are the reasons behind the decision to increase the price of sugar,” an Egyptian official said on Tuesday.

Egyptian authorities directed the blame towards sugar factories and distributors, accusing them of hoarding and smuggling supplies and dealt with the issue by seizing some 9,000 tons of sugar in recent raids on factories and warehouses.

Prime Minister Sherif Ismail told Egypt’s CBC channel in an interview that the raids have had a “positive impact” and sugar stocks were enough to cover the country for three months.

Egypt consumes about 3.2 million tons of sugar annually but produces just over 2 million tons leaving a gap of slightly over a million tons a year for imports.

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