EGYPT – Egyptian authorities have launched an enforcement drive to ensure bakeries comply with state-mandated price controls on bread, the country’s Consumer Protection Agency (CPA) has said.

The move comes as an extension to an earlier crackdown aimed at bakeries refusing to implement government-mandated price reductions.

In addition, prices of flour have dropped since late last month by more than a third to 14,000 Egyptian pounds a tonne.

With Egypt’s rate still higher than 30 per cent, lowering the cost of staples such as bread remains a major economic and political imperative.

The government closely regulates the price of subsidized bread, which is sold at 5 piastres per loaf to about 71 million Egyptians.

Ibrahim El Sagini, the Head of the Agency embarked on an extensive of inspections across the governorate to investigate whether bakers are complaint with the state’s order.  

According to him, agents have been deployed across Al Obour to inspect bakeries that make non-subsidised bread – also known as tourists’ bread – and verify they are producing and selling the product at the required weight and price.

“These campaigns are a follow-up to the directives of the Prime Minister to monitor the market situation on the ground, in light of the implementation of the President’s Abdel Fattah El Sisi’s directives to the government that the citizen should feel a radical and significant decrease in prices,” said Ibrahim.

Inspections in the Cairo suburb found 16 breaches, said the CPA, accusing bakeries of failing to display prices on labels, manipulating the weight of loaves and selling above official prices.

However, bakery owners attribute price variations to differences in the quality of flour used and various levels of shop rent, sparking a potential standoff between the authorities and independent bakers.

Last month, the Egyptian government announced that it would be implementing a three-month price control mechanism to keep prices down and threatened fines to any bakers who sold their bread at a higher price.

The government had attempted to bring down prices of bread by increasing its supplies of flour, after receiving an injection of cash from several international financing deals, bringing the price of flour down by between 15 and 25 per cent, depending on the flour’s quality.

According to Abdullah Ghorab, head of the bakeries union at the Federation of Egyptian Chambers of Commerce, the drop in flour price should have brought down the price of non-subsidised loaves by a similar amount.

Gamal Hassan, a seasoned baker in Cairo, explains the nuanced dynamics at play, highlighting the diverse factors influencing bread prices beyond flour costs alone.

He emphasizes the impact of rising rent rates and recent hikes in gas prices on bakery operations, underscoring the complex web of economic pressures faced by local businesses.

In response to the government’s efforts to enforce price controls and crackdown on profiteering, some bakers have opted to increase loaf weights rather than reduce prices.

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