Food programmes
An assessment of the impact of increasing wheat self-sufficiency and promoting cash-transfer subsidies for consumers in Egypt: a multi-market model
What would be the effects of cash-transfer subsidies be on the poor in Egypt?
Authors:
M. Siam Gamal
Publisher:
Agricultural and Development Economics Division, FAO, 2006
This paper uses a multi-market approach to assess the impact of increased self-sufficiency in wheat and a switch to a cash-transfer subsidy on cropping patterns, food consumption, production, input use, and income.
Wheat is central to the government of Egypt’s food security policy which is based on increasing self-sufficiency in wheat on the one hand and subsidising bread for consumers on the other hand.
The findings show that raising self-sufficiency in wheat would:
- reduce reliance on imports but would also adversely affect other sectors, in particular livestock
- at full self-sufficiency in wheat, berseem the main animal feed would nearly vanish, with negative repercussions for livestock production
- a move to a cash transfer subsidy system would improve targeting of the poor and eliminate distortions on the consumption side
- under the current wheat policy an increase in the world price of wheat would intensify the adverse consequences of both self-sufficiency and consumer subsidies at the agricultural sector level and economy wide
