Egypt to rely less on local banks

CAIRO: Egypt's government is looking at ways to reduce its dependence on borrowing from local banks because it is a burden on the economy, the finance minister said on Sunday.

"The government is considering ways to decrease reliance on internal funding because it constitutes a burden on the economy and is a temptation for banks to abandon their original role in funding the private sector," Minister Hazem el-Beblawi said.

He said the government could not continue with Egypt's costly subsidy regime that lowers prices for consumers and industry and changes were needed within two or three years.

"We want to start with things that are less harmful to the consumer," Beblawi told reporters. "People must get used to the idea that the subsidy is an exception."

Copyright Reuters, 2011