» 01/17/2012 EGYPT Petrol shortages could spark more unrest as revolution’s anniversary approaches With the loss of foreign funds, Egyptian authorities might have to cut subsidies for petrol, diesel and gaz. This could lead to a huge jump in prices and further stoke an already high inflation (9.5 per cent). With Islamist groups roaming Egyptian cities unchecked, the tourist industry is taking a nosedive. Between 2010 and 2011, bookings are down 90 per cent.
Cairo (AsiaNews) – As the first anniversary of Egypt’s Jasmine Revolution is rapidly approaching, the country faces a number of crises. Petrol and diesel fuel appear to be in short supply, the tourist sector has registered a 90 per cent drop, strikes and demonstrations are daily occurrences, and youth unemployment has reached 40 per cent with inflation at 9.5, up from 9.1 per cent in just a month. What is more, huge demonstrations against the military who took over after Mubarak’s fall are expected on the day of the anniversary, 25 January.
On Monday in Cairo, Giza and other Egyptian cities, cars continued queuing at gas stations, which said they had no gas or diesel to pump, whilst prices jumped. So as not to congest traffic, local authorities ordered the stations to work only in the evening.
Egypt's Oil Ministry on Monday dismissed claims of petrol shortages, saying that 21.5 million litres were already being pumped daily.
"The amounts currently being distributed are sufficient to meet some 15, 000 tonnes of daily consumption," Energy Minister Abdullah Ghorab said, 2,000 more than the daily consumption.
However, most Egyptians do not believe him and view the shortages as a prelude to a hike in the price of petrol and diesel fuel and a boom in black market sales. At present, petrol is one Egyptian pound (US$ 0.17) per litre thanks to subsidies.
At the same time, the central bank has announced that foreign reserves have fallen to US$ 16 billion from US$ 36 billion at the beginning of 2011.This has seriously cut into the government’s capacity to provide subsidies.
Economists now fear that higher fuel prices would push inflation above 10 per cent, which could lead to more unrest.
Higher diesel could also knock out Egyptian Railways. Tracks have been blocked many times in the recent unrest, especially in Upper Egypt. In one year, the company lost about US$ 13 million.
Speaking to AsiaNews, sources said that economic crisis is made worse by the collapse of the tourist sector.
“The victory by Islamist parties has led to such levels of intolerance that tourists have been scared off,” he said.
“Salafists but also members of the Muslim Brotherhood want to close down beaches, restaurants, bars and hotels because they violate Islamic principles. In Luxor and other cities, famous for their architecture and ancient archaeological sites, Salafist candidates running for the Nour party have called for the total shutdown of monuments. They don’t realise that they are sentencing Egypt to cultural isolation and poverty.”
Between 2010 and 2011, bookings drop by 90 per cent according to industry sources. The government disagrees, citing different numbers. According to the authorities, the decline was around 33 per cent. Some agencies note however that government figures include as tourists thousands of Libyan refugees. (S.C.)