Trade, Exchange Rate, and Agricultural Pricing Policies in Egypt

This study examines twenty-five years of pricing policies in agriculture, covering the period 1960-85. During this period, the price regime has discriminated strongly against agriculture. The study focuses on the objectives and implications of government intervention on five major crops, cotton, rice, wheat, maize, and sugarcane. It examines the economic history of price intervention, both at the sectoral and at the economy-wide level. After an introductory essay outlining political, macroeconomic, and sectoral developments, the objectives and instruments of agricultural policy are examined, and the incidence of intervention on relative prices and values added are studied. The effects of price intervention on agricultural output, rural and urban incomes, consumption, foreign exchange earnings, the government budget, and on resource flows in and out of agriculture are also examined. The study analyzes the determinants of agricultural pricing policies, including the influence of world prices and the relationship between government intervention and price variability. In the conclusions, a political-economic interpretation of twenty-five years of price interventions is given, and recent reform attempts are examined. Finally, background material such as time series data, calculations, and more detailed descriptions of economic policies and institutions are given in the appendices.