Egypt increases subsidies for cotton purchases by textile mills

The Egyptian government recently decided to increase subsidies for cotton purchases by textile mills and exporters this year. The subsidy amount will be increased from 200 million Egyptian pounds to 500 million Egyptian pounds (1 Egyptian pound is approximately 0.1398 US dollars).
The Egyptian government stated that the decision will promote the purchase of Egyptian cotton by textile mills and exporters and reduce cotton imports. It is understood that the subsidy standard is that textile mills can receive 50 Egyptian pounds per Etar (1 Etar is approximately 45-50 kilograms), and exporters can receive 200 Egyptian pounds per Etar. In other words, textile mills or exporters can receive corresponding subsidies as long as they purchase Egyptian cotton this year. Of the total subsidy of 500 million Egyptian pounds, 350 million will be used to subsidize textile mills and exporters, and the other 150 million will be subsidized to cotton farmers to purchase cotton seeds and fertilizers. The Egyptian government expects that this initiative will help increase Egypt’s cotton production.
According to statistics from the Egyptian Center for Public Mobilization and Statistics (CAPMAS), in the second quarter of this year, Egypt’s domestic textile mills’ purchases of Egyptian cotton decreased by 79.9% year-on-year, and exporters’ purchases fell by 46.5%.