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Egypt Reduces Jet Fuel Prices to Boost Aviation, Tourism Sectors

A worker gesturing for cars to move as others fill up at a petrol station in Cairo, Egypt on June 29, 2017 [KHALED DESOUKI/Getty Images]
A worker gesturing for cars to move as others fill up at a petrol station in Cairo, Egypt on June 29, 2017 [KHALED DESOUKI/Getty Images]
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Egypt Reduces Jet Fuel Prices to Boost Aviation, Tourism Sectors

A worker gesturing for cars to move as others fill up at a petrol station in Cairo, Egypt on June 29, 2017 [KHALED DESOUKI/Getty Images]
A worker gesturing for cars to move as others fill up at a petrol station in Cairo, Egypt on June 29, 2017 [KHALED DESOUKI/Getty Images]

Egypt will reduce jet fuel prices by 15 cents per gallon from January 21 until the end of 2021 to support the tourism and aviation sectors amid challenges posed by COVID-19 pandemic.

The decision came during the fourth meeting between Minister of Petroleum and Mineral Resources Tarek El Molla, Minister of Tourism and Antiquities Khaled Al-Anani, and Minister of Civil Aviation Mohamed Manar to discuss ways to boost the affected sectors.

For his part, Anani hailed the initiative, saying it will boost tourism in Egypt by motivating international companies to increase their flights.

Also, Manar praised the petroleum sector’s effort and support in providing fuel to all Egypt’s airports.

In a related context, Egypt and the International Islamic Trade Finance Corporation (ITFC) signed a finance cooperation program for 2021, providing the country with integrated financing solutions worth $1.1 billion.

The funds come as part of the $3 billion agreement concluded between the Ministry of International Cooperation and the ITFC in 2018.

The signing ceremony was attended by Minister of Planning and Economic Development and Egypt’s Governor at the Islamic Development Bank Group Hala El-Said, Minister of Petroleum and Mineral Resources Tarek El Molla, Minister of Supply and Internal Trade Aly Meselhi, Minister of International Cooperation Rania Al-Mashat, and Minister of Trade and Industry Nevine Gamea.

The program was signed by ITFC CEO Hani Salem Sonbol, Executive Vice President of the Egyptian General Petroleum Corporation (EGPC) Ashraf Abdullah, and Vice-Chairperson of the General Authority for Supply Commodities (GASC) Ahmed Youssef.

According to Molla, the five agreements have a total value of $9.2 billion, including the fifth framework agreement signed at the end of January 2018 at a value of $3 billion. For the financing of basic commodities, 16 financing operations amounting to $2.225 billion were approved within the agreement’s framework.

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China Approves $840B Plan to Refinance Local Government Debt, Boost Economy

Visitors walk past a shop under construction with a dragon mural at the Sanlitun shopping district in Beijing, Friday, Nov. 8, 2024. (AP Photo/Ng Han Guan)
Visitors walk past a shop under construction with a dragon mural at the Sanlitun shopping district in Beijing, Friday, Nov. 8, 2024. (AP Photo/Ng Han Guan)
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China Approves $840B Plan to Refinance Local Government Debt, Boost Economy

Visitors walk past a shop under construction with a dragon mural at the Sanlitun shopping district in Beijing, Friday, Nov. 8, 2024. (AP Photo/Ng Han Guan)
Visitors walk past a shop under construction with a dragon mural at the Sanlitun shopping district in Beijing, Friday, Nov. 8, 2024. (AP Photo/Ng Han Guan)

China on Friday approved a 6 trillion yuan ($839 billion) plan to help local governments refinance their mountains of debt, in the latest push to rev up growth in the world’s second largest economy.

The plan will be implemented over the next three years, Xu Hongcai, vice-chairman of the National People's Congress's financial and economic committee, said at a news conference Friday.

Finance minister Lan Fo'an estimated that the hidden debt of local governments was 14.3 trillion yuan ($2 trillion) at the end of 2023. Hidden debt refers to debt that has not been disclosed publicly, The Associated Press reported.

Lan said 2 trillion yuan would be allocated each year from 2024 to 2026 to help local governments resolve their debts. He estimated that the amount of hidden debt will drop to 2.3 trillion yuan ($320.9 billion) by the end of 2028.

Officials also said Friday that the ceiling to issue special bonds will be raised to 35.52 trillion yuan ($4.96 billion) from 29.52 trillion yuan ($4.12 billion) for local governments.

Lan said that the implementation of such a large-scale replacement measure indicates a “fundamental shift” in China's approach to debt restructuring and said that China’s government debt risk was “controllable.”

Analysts have called for bold, multi-trillion-yuan measures to reinvigorate the world's second largest economy, which has yet to bounce back fully from the COVID-19 pandemic.
Local government debts have ballooned partly due to high spending and low tax revenues during the pandemic, but also due to a downturn in the property industry, since sales of land use rights, a key source of local government revenue, have sagged.

The central bank loosened restrictions on borrowing in late September, sparking a stock market rally, but economists say the government needs to do more to ignite a sustained recovery. Government officials have indicated that could come at this week's meeting of the Standing Committee of the National People's Congress, which must give official approval to any new spending.

The economy has shown signs of life in the past two months. Purchase subsidies offered to people who trade in old cars or appliances for new ones helped auto sales rebound in September. A survey of manufacturers turned positive in October after five straight months of decline, and exports surged 12.7% last month, the largest increase in more than two years.

For most of the year, the ruling Communist Party appeared more focused on addressing long-term structural issues with the economy rather than short-term ones. Previous steps to boost the economy were piecemeal, seemingly aimed at keeping the economy afloat rather than sparking a robust recovery.

In recent weeks, the party has signaled a growing concern about the economy's sluggishness as it tries to meet its goal of achieving growth of around 5% this year. The central bank's monetary easing was followed by government pronouncements that it still has ample funds to pump into the economy.

Still, the longer-term goals of transforming China into a high-tech and green energy economy seem likely to remain the chief aims of the Communist Party, which doesn't face election pressures like the ones that toppled the Democrats and swept Donald Trump's Republicans to power in America this week.