Egypt's military to form pharmaceutical company
CAIRO - The Egyptian government has given the military the go-ahead to establish a pharmaceuticals company in a market hit by shortages and a dollar crunch that has driven up prices.
Prime Minister Sherif Ismail issued the decision in a decree published on Sunday in the official gazette.
Ismail "authorises the National Authority for Military Production to participate in the establishment of a joint-stock company" under the name of the Egyptian National Company for Pharmaceutical Products, the decree read.
The announcement did not provide details on the types of medicine it would be able to research or produce.
Health Minister Ahmed Emad announced on January 12 that prices for a quarter of the medicines sold in Egypt would be raised by between 30 and 50 percent.
Egypt's foreign currency reserves have plummeted since the 2011 uprising that toppled longtime president Hosni Mubarak.
The price of pharmaceuticals has risen in the past year, with the shortage of dollars hitting the import of drugs manufactured abroad as well as raw materials used to make them in the country.
Consumer prices have surged since November, when the central bank floated the pound and the government slashed fuel subsidies as part of a $12 billion loan deal agreed with the International Monetary Fund.
The currency's value has fallen from 8.83 to the dollar before the floatation to more than 18 pounds on Monday.
The Egyptian military has for decades played a key though opaque economic role, producing everything from washing machines to pasta, alongside building roads and operating gas stations.
But the army's involvement in the economy has been more visible since the June 2014 inauguration of President Abdel Fattah al-Sisi, a former army chief who toppled his Islamist predecessor Mohamed Morsi in 2013.
The medicine shortage affected basic products including insulin and some medicines used to treat diabetes -- 17 percent of adult Egyptians have the disease, according to official figures.
It also impacted some medicines used to treat heart disease, cancer, and solutions used in dialysis.
It is difficult to assess the military's share in the economy and details of its budget cannot be published.
Responding to criticism that the military's involvement in the economy is crowding out the private sector, Sisi said in December that it only accounts for 1.5 to two percent of the country's economic output.
Sisi also defended the military's role, saying it was not doing so to enrich itself, but to assist in controlling price hikes working alongside the private sector.