Ongoing Research

Focused Projects Every year, the Center selects several timely issues that are of chief concern to Egypt's economic reform schedule. Generally, these studies are headed by one or two economists who investigate, develop and produce the final results. Focused projects usually conclude with a presentation in the form of a workshop, distinguished lecture or roundtable discussion and the publication of the study in the ECES Working Paper or Distinguished Lecture series.

Price Subsidies in Egypt: Alternatives for Reform The Role of the Financial Sector in Macroeconomic Development: Evidence and Policy Implications Are Capital Flows Beneficial to Economic Growth and Private Sector Activity in Egypt? Mortgage Finance in Egypt: Insights from the Global Financial Crisis The Effect of the Global Turmoil on Microeconomic Performance in Egypt: Evidence from Firm-Level Survey Macroeconomic Implications of Monetary Transmission in Egypt

Price Subsidies in Egypt: Alternatives for Reform

Subsidies are a major item in government expenditures in Egypt, accounting for 36 percent of total expenditures in 08/09. They aim at mitigating the cost of living on vulnerable groups, providing basic fuel and food products at prices that fall below the market price. However, persistent budget deficit (reaching 6.9 percent of GDP in 08/09) and limited capacity to mobilize additional resources to tackle other government spending priorities on education and health have brought to the fore a heated debate concerning subsidy reform in Egypt. Proponents have attacked the current system on two accounts: (i) the high fiscal cost and its implication on the budget and rising public debt, and (ii) failure to target vulnerable groups, wasting government resources in financing excessive consumption and profits. Advocates of maintaining the current subsidy system have emphasized concerns about the adverse effects of phasing out subsidies on inflation, growth and social equity besides the difficulty to target and administer cash transfers and/or rationing cards to the poor. The discussion will engage both sides in a lively debate.

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