IslamicFinance.de

President Abdel-Fattah al-Sisi aims to slash a subsidy bill, mostly for food and energy, that ballooned to about 8 percent of economic output last fiscal year. Instead, money will be directed to those who need it most – eventually, about 18 million Egyptians, the poorest 20 percent of the population. After years of political turmoil the government is eager to make sure they’re spared the impact of spending cuts. Yet it’s also under pressure from investors to trim one of the region’s biggest budget deficits. Targeted handouts are a way of achieving both goals. The program called Takaful or Solidarity gives cash to families on condition that their children attend school and undergo regular medical checkups. Another plan, Karama or Dignity, covers the elderly and the disabled.