Egypt Authorities Seize Sugar at Edita Plant Amid ShortageBy
Police also seized sugar at Pepsi plant, impacting production
Government’s handling of the situation is "shameful:" Berzi
Egyptian authorities seized thousands of tons of sugar from confectionery maker Edita Food Industries S.A.E. and PepsiCo Inc., raising concerns about the government’s handling of a sugar shortage in the country.
The seizure of roughly 2,000 tons of sugar at a Edita factory amounted to around three weeks worth of the commodity and impacted production at the plant, Edita Chairman Hani Berzi said in an interview with Cairo-based CBC TV. Authorities were assessing whether the company, one of Egypt’s largest food makers, was overstocking the commodity, he said. Shares of the company, which produces Twinkies and Ho Hos among other snacks, fell 6.7 percent at the start of trading on the Egyptian stock market. PepsiCo executives weren’t immediately available for comment on the seizure at one of their local plants.
"If the government has a problem, they should come and negotiate, but this way of seizing stocks and treating us as smugglers is shameful," Berzi said. Other senior government officials intervened to block implementation of a decision to confiscate the sugar and sell it to the public, he said.
A sugar shortage has led to prices almost doubling to 10 pounds per kilogram in the past few weeks. The crisis comes at a time when Egypt is looking to finalize a $12 billion International Monetary Fund loan officials see as key to reviving an economy that has been struggling since the 2011 uprising against President Hosni Mubarak.
Businesses have been struggling as a dearth of hard currency led to a spike in the U.S. dollar in the black market. Egyptian officials are expected to either devalue or float the pound, though that move has yet to materialize at a time when officials are concerned about the inflationary impact of the step and its potential to further inflame the population.