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The Lebanese crisis has erupted again, with the Lebanese Central Bank announcing a few days ago its intention to stop subsidizing fuel imports, and Lebanese leaders agreed earlier this week on a short-term compromise. term to maintain fuel subsidies, with the aim of alleviating the severe shortage in the country, amid an unprecedented financial and political crisis. It’s like hitting the country for months.
In Egypt, the country has experienced a new wave of inflation in recent months with rising fuel and electricity prices, and after the state announced a further cut in fuel subsidies in the 2022 budget as part of a broader economic reform program, after a 35% reduction. energy subsidies over the past year, and the state has announced its intention to end energy subsidies completely by 2025.
Saudi Arabia is also a major producer of oil. In the past five years, it has seen five years of stopping fuel subsidies, but this year it has decided to stabilize fuel prices in order to ease the burden on citizens, amid disagreements between the countries of OPEC on the volume of production and the resulting fluctuation in oil prices.
International lending institutions recommend economic reform programs based on ending government energy subsidies, claiming it would increase growth rates and increase equality, and suggest replacing it with cash support for groups. needy.
Jordan implemented this recommendation years ago, but a few weeks ago fuel prices saw further increases for the sixth time in 2021.
Speaking to “Sputnik”, economist Dr. Mustafa Barzkan: “The decisions of countries that have adopted the free economy to subsidize fuel have come from the shock that citizens have felt as a result of the transition from socialist regimes, and decisions to raise the subsidy came as a result of the budgets of countries needing these amounts, as some economies need to inject these funds for public spending. “
The expert explained that “there are some countries whose budgets depend mainly on the taxes they impose on fuel, which in countries like Great Britain reach 60% of the price of fuel.”
Regarding the explosion of social conditions in Lebanon after the announcement of the lifting of aid, the professor of sociology, said Dr. Talal Atris said: “The economic policies in Lebanon have been wrong for decades and have plunged governments in seizures. at the general level, this has not happened, and the problem is the lack of vision for moving from full subsidies for most products to the elimination of full subsidies, provided that this is accompanied by the fight against corruption and monopolies.
Atrissi estimated that “the recourse to contraband subsidized fuel expresses a vacuum at the political, security and judicial levels. supposed to be a kind of solidarity and compassion in times of crisis. “
On the terms of international lending institutions and their claim to reduce support, said Dr. Fakhri El-Feki, former deputy executive director of the International Monetary Fund, said: “The IMF is concerned with achieving stability in the balance of payments and exchange rates, which is why countries use them and provide them with conditional funding for economic reform plans, including subsidy reduction, and countries must either agree to the terms or not get them. financing, so they accept by countries.
The expert explained that “the fund is keen to support economies around the world, and in light of the Corona pandemic, over the past few days it has allocated $ 100 billion to provide liquidity to affected economies in part of the so-called quick finance tools, and it also allocated units of special drawing rights equivalent to 650 billion distributed among member states and obtained that developing countries get 45 percent of this allocation.
Prepared and presented by: Jihan Lotfi
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