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3 edition of The impact of reducing energy subsidies on energy intensive industries in Egypt found in the catalog.

The impact of reducing energy subsidies on energy intensive industries in Egypt

The impact of reducing energy subsidies on energy intensive industries in Egypt

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Published by The Egyptian Center for Economic Studies in Cairo .
Written in English


Edition Notes

StatementAbdallah Shehata Khattab.
SeriesWorking paper -- no. 124
Classifications
LC ClassificationsMicrofiche 2009/52327 (H)
The Physical Object
FormatMicroform
Pagination34 p.
Number of Pages34
ID Numbers
Open LibraryOL23669242M
LC Control Number2009321733

Although aimed at protecting consumers, subsidies aggravate fiscal imbalances, crowd out priority public spending, and depress private investment, including in the energy sector. Subsidies also distort resource allocation by encouraging excessive energy consumption, artificially promoting capital- intensive industries, reducing incentives for. A subsidy or government incentive is a form of financial aid or support extended to an economic sector (business, or individual) generally with the aim of promoting economic and social policy. Although commonly extended from government, the term subsidy can relate to any type of support – for example from NGOs or as implicit subsidies. Subsidies come in various forms . Indeed, subsidies tend to increase unemployment (as energy is substituted for labor) and encourage over-investment in energy-intensive industries at the expense of other sectors. At the same time, they have little impact on overall trade balances, inflation, or the lot of the poor. Reducing embodied energy to lessen the overall impact of the built environment must become a major priority when you consider that today the proportion of embodied energy in buildings has increased to more than 40% of energy consumption.


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The impact of reducing energy subsidies on energy intensive industries in Egypt Download PDF EPUB FB2

This chapter investigates the potential impact of reducing energy subsidies in Egypt on energy-intensive industries. A partial equilibrium approach is applied to assess such a policy. Specifically, the chapter examines the effect of subsidy reduction on energy-driven sectors, under different scenarios of increasing prices of energy : Hanaa Kheir-El-Din.

This chapter investigates the potential impact of reducing energy subsidies in Egypt on energy-intensive industries. A partial equilibrium approach is applied to assess such a policy. Specifically, the chapter examines the effect of subsidy reduction on energy-driven sectors, under different scenarios of increasing prices of energy products.

2 Impact of Energy Subsidies on the Budget Energy subsidies represent a substan - tial drain on Egypt’s budget.

Although energy subsidies are not reported clearly and accurately 4, the official sta - tistics show that petroleum subsidies increased from 40 billion of Egyptian Pounds (LE) (equivalent to about US$ billion) in / File Size: KB. 1Khattab A.S. () “Assessing the impacts of removing energy subsidies on energy intensive industries in Egypt” found that the increase in the energy price up to % will make the profit ratio of cement industry reduced from 39% to 29%.; the figure for fertilizer is % to %.

And for steel industry is from % to %. Energy Subsidies Elimination in Egypt and its Impact on Energy Intensive Industries In Egypt, the manufacturing sector, particularly, energyintensive industries benefit from all subsidies on energyproducts, namely, fuel oil, diesel, natural gas and er, it benefits, indirectly, from subsidies given tothe transportation sector in a form of lower cost.

Impact of The Energy Subsidy removal in The impact of reducing energy subsidies on energy intensive industries in Egypt book the all income groups and poverty in Egypt required the Chinese government to reduce energy subsidies at the Energy intensive industries. Egypt: guiding reform of energy subsidies long-term (English) Abstract This paper examines the short- and long-run economic impact of Egypt's energy subsidy reform in July (without and without compensating transfers for the bottom 40 percent of the income distribution) and the decline in global energy prices, as well See More +.Cited by: 1.

phasing out of energy subsidies for The impact of reducing energy subsidies on energy intensive industries in Egypt book few energy-intensive industries, such cement, textiles, ceramics, and food processing. On the whole, however, there has been no serious attempt at a systemic overhaul of energy subsidies post Like Tunisia, Egypt has also maintained an extensive system of energy subsidies which offers energy.

consumers and industries at varying rates (see figure 6). The impact of gradually lifting energy subsidies on consumers and producers are difficult to measure and evaluate. But the literature on energy subsidies in developing countries confirm the burdens accrued to the poor vis-a-vis the rich, especially with a policy that is not structured with a.

Energy The impact of reducing energy subsidies on energy intensive industries in Egypt book have been described as socially inequitable and fiscally draining for economies in the Middle East and North Africa (MENA). This is particularly true for resource-scarce, labour-abundant economies such as Tunisia and Egypt who cannot rely on ample resource rents to finance energy subsidies.

Despite these shortcomings, governments have struggled to reform subsidies. This paper examines the short- and long-run economic impact of Egypt's energy subsidy reform in July (without and without compensating transfers for the bottom 40 percent of the income distribution) and the decline in global energy prices, as well as the long-run impact of phasing out the energy subsidies over a 5 year period.

(UNDP), and the Government of Egypt, and executed by the Egyptian Electricity Holding Company (EEHC), Ministry of Electricity and Energy (MOEE). This project phase ended in year This project was to assist Egypt in reducing the long term growth of GHG emission from electric power generation and consumption of non-renewable fuel resources.

higher energy prices on industry and on investment in energy-intensive industries (Wahish, ). The government made significant efforts to communicate the rationale for reforms immediately before and after the event, beginning with a The impact of reducing energy subsidies on energy intensive industries in Egypt book offensive on the energy subsidy problem during the budget negotiations in late June (Zayed, ).Author: Kieran Clarke.

Phasing out energy subsidies is high on the agenda of policymakers in several Middle Eastern and North African countries. The impact of such reform can vary widely depending on the country and policy. This paper contributes to the existing literature by examining the phasing out of energy subsidies in Egypt under alternative economic by: 3.

The Government of Egypt reformed prices of electricity and petroleum fuels several mes over the course of the s, but rising interna onal oil prices meant that fossil fuel subsidies increased drama cally over the last dec‐ ade. Inspending on energy subsidies comprised a large share of budget expenditure (22%).

Fossil fuel subsidies. In Novemberthe cabinet issued a decree to end subsidies on natural gas to energy-intensive industries in Januarybut this did not occur. Similarly, the minister of supply and internal trade announced a new coupon system for distributing butane canisters in September   price volatility and supporting energy-intensive industries.2 Although energy subsidies have the potential to generate short-term benefits, they have been criticized for leading to unintended adverse consequences by impeding market functions, limiting investment in clean energy sources and undermining efforts to deal with climate changeFile Size: KB.

Energy subsidies create distortions that are harmful to the economy. They can discourage investment in the energy sector and in more labor-intensive industries, and create incentives for waste and smuggling.

Energy subsidies also divert public resources away from spending that promotes more inclusive growth (Figure 4). But energy subsidies also go to firms, and mainly to those in the energy intensive sectors.

These subsidies, mainly in the form of diesel, account for nearly 25% of total energy subsidies, costing overall about 3% GDP, or close to $8 billion (in. Energy subsidies have a negative impact on economic effi ciency, in particular lower institutional quality levels, and/or a desire to establish energy-intensive industries.

Furthermore, in some countries the population expects to consume ENERGY SUBSIDY REFORM IN SUB-SAHARAN AFRICA: EXPERIENCES AND LESSONS. Sub-Saharan Africa 2 –2. Egypt’s government has set the goal of having 20 percent of its installed generation capacity in the form of renewable energy by It is already a regional leader in wind-power generation, with an installed megawatts (MW) of wind-energy capacity that is performing well.

External agencies, such as the International Monetary Fund (IMF), have long encouraged Egypt to enact reforms and reduce, or remove, energy subsidies to enable channeling of funds into much-needed social programs for health and education.

Inthese subsidies amounted to about 10 percent of the Gross Domestic Product (GDP), a staggering : Dianne Sutherland. Malaysia pays a great share of its gross domestic product on energy subsidies. Payment of subsidies causes some failures in the economy, such as disrupting the price mechanism and destroying allocation of resources in the economy.

Removing these subsidies has important implication for sustainable development through their effects on energy Cited by: Implicit subsidies also create important domestic pricing signals, for instance favouring energy-intensive industrialization strategies; and reducing the marginal private cost of energy for individuals, in the same way as explicit subsidies do, hence influencing economic agents' energy consumption by: Impacts of energy subsidy reform on the Malaysian economy and transportation sector Article in Energy Policy – July with 1, Reads How we measure 'reads'.

Most current federal subsidies support developing renewable energy supplies (primarily biofuels, wind, and solar) and reducing energy consumption through energy efficiency. In FYnearly half (45%) of federal energy subsidies were associated with renewable energy, and 42% were associated with energy end uses.

Critics of subsidies for renewable energy are usually met with the retort that the oil industry gets trillions subsidies, as in this article, which claims that these subsidies amount to.

AMR ADLY: The share of fuel subsidies in the budget was raised in / and reached a record inwith the Brent barrel exceeding US$ and Egypt turning to fully importing oil since This means that since then, the Egyptian government has started to depend on importing petroleum products from abroad at international prices, or close to them, which influenced the size of subsidies.

This report—an update based on Fiscal Year (FY) data—continues a series of U.S. Energy Information Administration (EIA) reports on federal direct financial interventions and subsidies into energy markets. Using a set of data sources and File Size: KB.

energy subsidies – In the past few years, Egypt, Jordan, Mauritania, Morocco, Sudan, Tunisia, and Yemen initiated subsidy reform by increasing energy prices while mitigating the impact on the poor —albeit with varying levels of effort and results. – In most cases, reforms have been part of a broad- based fiscal.

While the political and economic climate in Egypt makes no easy task of teasing out the exact cause for lack of ef-fective energy efficiency (EE) regulation, subsidies provide a direct link to the country’s consumption woes.

“The rea-son to have energy efficiency regulations is to lower energyFile Size: KB. The Egyptian economy has undergone several reforms since the early s. However, it was not until recently that the reform process picked up speed and intensity. Key initiatives included shifting to a flexible exchange rate regime, liberalizing trade, revising and reducing the tariff structure, and improving the income tax system.

Plans are underway to restructure the. Energy subsidies are among the most pervasive and controversial fiscal policy tools used in the Middle East and North Africa (MENA).

In a region with few functioning social welfare systems, subsidised energy prices continue to form an important social safety net, albeit a highly costly and inefficient one. In the MENA region’s oil and gas producing countries, low energy prices have Cited by:   Egypt's efforts to chip away at a daunting budget deficit have taken hold, with Cairo reporting that the government spent about 30% less on fuel subsidies during the first half of this fiscal year Author: Christopher Coats.

for example cheap energy is a comparative advantage for energy-intensive manufacturing industries. Fossil fuel con-sumption subsidies are also seen as a way to share natural resource wealth with the population in energy producing countries.

Production subsidies are meant to boost domestic energy supply (thought of as strategically important byFile Size: KB. Energy subsidies are measures that keep prices for consumers below market levels or for producers above market levels, or reduce costs for consumers and producers.

Energy subsidies may be direct cash transfers to producers, consumers, or related bodies, as well as indirect support mechanisms, such as tax exemptions and rebates, price controls, trade restrictions. Subsidies also distort resource allocation by encouraging excessive energy consumption, artificially promoting capital-intensive industries, reducing incentives for investment in renewable energy.

2 Impact of Oil Price on Solar Industry,Green Rhino Energy () 3 Why Solar is Correlated With Crude, 01 DecSeeking Alpha () 4 Countries that have (or plan to) cut subsidies for fossil fuels include Germany, Morocco, Mexico, Egypt, and Malaysia.

The future of these energy-intensive industries, which will have to rely ever more heavily on imported energy—whether in the form of natural gas, coal, oil or even electricity, which will be at or near global prices—is bleak, for they were all built on the basis of subsidised energy inputs.

None require significant labour forces, so Egypt Cited by: 1. In Egypt, 60 % of the subsidies in accrued to the rich who consume more energy than the poor. As such they are not a good tool for social protection.

However, energy subsidies also have had a negative impact on the energy sector, as they attract energy-intensive activities, foster overconsumption and discourage investments.

Renewable energy industry primed for continued growth. Pdf the first time ever, in Aprilpdf energy outpaced coal by providing 23 percent of US power generation, compared to coal’s 20 percent share.

1 In the first half ofwind and solar together accounted for approximately 50 percent of total US renewable electricity generation, displacing hydroelectric Author: Marlene Motyka.Taxes and incentives for renewable energy | 2.

Industry trends. The global energy download pdf based on hydrocarbons is undergoing a foundational shift. No one disputes the need for increased energy supplies. Global demand for electricity is expected to rise by more than 80 percent from todriven by an increase in total population andFile Size: 1MB.Get this from ebook library!

A Profile of Border Protection in Egypt: An Effective Rate of Protection Approach Ebook for Energy Subsidies. [Alberto Valdés; World Bank.] -- This study examines recent effective rates of protection across the Egyptian economy, using an ad valorem price wedge introduced by nontariff barriers and energy subsidies, and compares today's.