On 2 June, the Council of Ministers announced the signing of a memorandum of understanding between the Holding Company for Food Industries and the Micro, Small and Medium Enterprises Development Agency (MSMEDA), to convert and develop subsidized food outlets, primarily the “Gamiety” project and subsidized food dealers, to operate under the umbrella of the “Carry On” company, which President Abdel Fattah al-Sisi approved last February as a national project aimed at unifying the commercial brand of consumer complexes and subsidized food outlets.
The memorandum included MSMEDA making available an integrated package of financial and technical services to owners of existing and new subsidized food outlets, including project financing through a franchise system.
This system is based on granting the owner of a successful brand the right for another investor to use the trademark and apply its approved operating model within a defined geographic area, in exchange for an agreed financial return, allowing the investor to benefit from the operational expertise and accumulated commercial reputation of the brand’s owning company.
The number of subsidized food outlets in Egypt stands at 40,000, comprising approximately 30,000 subsidized food dealers, 8,500 outlets within the “Gamiety” project, more than 300 mobile vehicles for selling food commodities, and 1,062 outlets affiliated with the Holding Company for Food Industries, serving approximately 60.8 million citizens.
The MSMEDA is set to provide a package of tax, credit, and marketing incentives to support the project of unifying the appearance and visual identity of subsidized food outlets across the country. However, these directives have triggered a state of concern and questions among subsidized food outlet owners, food dealers, and “Gamiety” project branches, who expressed in statements to Zawia3 their fears that the development process may impose additional financial burdens that some small establishments may not be able to bear.
Maged Nadi, head of the Subsidized Grocers Syndicate and representative of subsidized food dealers across governorates, says that “Gamiety” project branches and subsidized food outlets have not yet received any official communications or circulars from the Ministry of Supply or the relevant authorities explaining the mechanisms for transitioning to the “Carry On” brand, or specifying whether joining the new system will be mandatory or voluntary. The competent authorities have also not announced, according to him, the sources of financing for development works or how outlets will bear the costs of their implementation.
While supporting the plan to develop subsidized food outlets and improve the level of services provided to citizens, Nadi expresses reservations regarding the anticipated requirements of the project, particularly those related to the floor space required for branches, which may not be available at a large number of existing subsidized grocery stores and “Gamiety” outlets.
He also warns that some traders may be forced to rent new premises or carry out extensive renovation works at their own expense in order to comply with the new standards, before later facing the risk of landlords not renewing lease contracts, which could result in the loss of investments they injected into those locations.
The project began on 29 September of last year, when Air Force Colonel Bahaa El-Ghanam, CEO of the Future of Egypt Authority for Sustainable Development, and Dr. Sherif Farouk, Minister of Supply and Internal Trade, inaugurated the first three developed branches of consumer complexes under the unified “Carry On” brand, in the areas of Kulliyat Al-Banat, Al-Amiriyya, and Al-Sayyida Zeinab, specializing in the sale of meat and fish.
As part of the project’s expansion, the Minister of Supply inaugurated the fourth branch last December at Media Production City in Giza Governorate, while the plan targets further expansion with the opening of new chains in the Shinzo Abe area and Gaza Market in Cairo, as part of a government drive to redevelop food commodity outlets and unify their commercial identity.
“Carry On” is an extension of the commercial chain concept previously launched by the Future of Egypt Authority under the name “Super Tawfeer,” which comprises 1,427 outlets across various governorates and targets reaching 2,000 outlets by 2027. The Authority says these outlets contribute to lowering prices by cutting supply chain intermediaries and delivering products directly from the source to the citizen. Through the “Khairiha” brand, the Authority supplies 20 strategic commodities including sugar, rice, oil, flour, legumes, and frozen vegetables.
The “Carry On” project grants the Future of Egypt Authority for Sustainable Development an expanding role in the food trade and distribution sector, after its activities broadened in recent years from agricultural production and land reclamation to food import, marketing, and distribution.
The Authority is a government entity established by Presidential Decree No. 591 of 2022, headed by Air Force Colonel Bahaa El-Din Mohamed El-Ghanam, and manages a number of major economic and development projects, including agricultural land reclamation, strategic commodity imports, food production, and various industrial and service projects. With the expansion of its activities and its growing entry into food production and distribution chains, the Authority continues to generate ongoing controversy regarding the nature of its economic role, its operating mechanisms, and its impact on the structure of local markets.
Recommended Reading: From Bread to Land: The Future of Egypt Authority Extends Its Reach Into Everything Grown and Eaten
Deteriorating Economic and Professional Conditions
The announcement of the transition to the “Carry On” brand comes at a time when owners of “Gamiety” branches and subsidized food dealers are facing deteriorating economic and professional conditions, in the absence of any social or health guarantees or insurance for workers within the system. They bear all operational burdens at their own expense, from transporting goods from warehouses to outlets, through paying shop and warehouse rents, electricity and water bills, and labor wages, to absorbing the losses of any shortfalls, spoilage, or theft that may occur during operations, according to Said Mohamed, a subsidized food dealer in Menoufia Governorate.
He considers that rising goods transportation costs have become a significant burden on outlet owners, with the cost of a cargo trip rising from a few tens of pounds previously to between 600 and 700 Egyptian pounds ($11.54 and $13.46) currently, at a time when many food dealers suffer from a lack of liquidity and are sometimes unable to cover basic operating expenses.
He tells Zawia3: “Those working in the system are forced to work long hours stretching to 10 and 12 hours a day, including during some holiday periods, without receiving leave or job benefits comparable to workers in other sectors.”
He affirms that the problem is not limited to the living conditions of food dealers but extends to the absence of clarity regarding operating mechanisms and the anticipated changes to the subsidized supply system, noting that traders are frequently surprised by new decisions or procedures without prior notification or adequate explanation, despite the fact that they deal with citizens directly and bear the consequences of any commodity shortages or delays in their arrival.
He points out that ration card holders hold the trader responsible for any crisis related to the availability of goods or the functioning of the system, despite such crises being linked to delays in goods delivery or administrative decisions beyond the control of outlet owners. He calls on the Ministry of Supply to promptly announce the new policies related to the transition to the Carry On brand, so that food dealers can prepare for them and explain them to citizens.
Mona El-Sayed (a pseudonym), who manages a “Gamiety” branch in Kafr El-Sheikh with her husband, believes that talk of developing outlets or obtaining new loans does not account for the difficult economic reality facing branch owners. The profit margin on some subsidized commodities is extremely limited, sometimes not exceeding 25 piasters per unit, while the trader bears the full losses from spoilage or damaged goods, in addition to operational expenses including rents, electricity, printing paper, bags, and other services.
She affirms that the “Gamiety” project barely covers its operating costs and taxes and social insurance payments, while her husband is forced to work an additional job after finishing his shift at the shop to meet the family’s needs.
She tells Zawia3: “We and many other branch owners are still repaying the loans we obtained when we started the project, to pay the insurance and goods costs, and we have been burdened with exhausting financing obligations, which makes the idea of obtaining new loans for development something of a crisis for us.”
She affirms that the majority of outlet owners do not reject development in principle, but need clarity regarding implementation mechanisms, costs, and funding sources, adding: “People do not want to take on new loans before knowing the fate of the project and the shape of the new system. For us, the priority is to continue and cover current expenses, not to take on additional financial burdens we may not be able to meet.”
Mona expresses her concern that the proposed development requirements call for shop floor spaces of no less than 30 square meters, at a time when rents have risen sharply, affirming that the majority of branch owners, particularly those renting, do not know how they will be able to bear the costs of expansions or development given the weak current returns.
She also points out that outlet owners face recurring problems in securing subsidized goods, explaining that some branches begin distributing ration allocations at the start of the month and then spend days or weeks waiting for new shipments of essential commodities, primarily sugar and oil, while commodity shortages place the trader in direct confrontation with citizens, who hold them responsible for the unavailability of items announced as part of the subsidy or additional grant.
Space Requirements and Development Costs
Last April, the Ministry of Supply and Internal Trade began surveying grocery outlets across the country wishing to join the “Carry On” system, with the data to be reviewed and outlets verified as meeting the designated conditions before being developed and incorporated into the system.
Application forms for subsidized food dealers and “Gamiety” outlets to convert their outlets to the “Carry On” chain, which the Ministry of Supply and Internal Trade sent to the Food and Subsidized Groceries Division of the Chambers of Commerce last April, requested the following information: the name of the activity owner, the name of the responsible manager if applicable, the outlet’s detailed address, the governorate it belongs to, the outlet’s floor area, whether the outlet is rented or owned, the duration of the lease contract, and a telephone number.
Ali Abu Zarayr, a subsidized food dealer in Sharqia Governorate, was among the first traders to register in the survey announced by the Ministry of Supply, hoping to improve the conditions of his business, whose profits are largely consumed by taxes amounting to approximately 27,000 Egyptian pounds ($519.23) annually, in addition to social insurance of approximately 1,000 Egyptian pounds ($19.23) per month, goods and subsidized commodity transportation costs, and the value of waste resulting from the spoilage of quantities of packaging during transport.
Although the information currently available regarding the “Carry On” system remains limited, Abu Zarayr confirms that one of the basic conditions for joining the system is that the outlet must have a floor area of no less than 30 square meters, and that the trader will bear the cost of development.
He notes that the official application window for the system has not yet opened, and that what is currently taking place is limited to surveying those wishing to join, with the implementation procedures expected to begin, according to what traders have been informed, at the start of next year.
He explains that the proposed system is based on the concept of a “unified card,” whereby the citizen receives cash support on their card and uses it to purchase whatever they need, similar to the free market, rather than being limited to a specific list of subsidized commodities. Developed branches would combine free trade and subsidized goods within a single outlet.
He tells Zawia3: “The system may help address some of the problems currently faced by food dealers, particularly regarding the costs of transporting subsidized goods, especially for small outlets that receive limited quantities of goods.”
The subsidized grocer hopes that expansion in commercial activity will compensate traders for development costs and high rents through increased sales volumes and greater variety of goods on offer.
Although the details of the participating entities and supply mechanisms have not yet been announced, he explains that the Ministry of Supply will remain a supervisory body over the system, while the Holding Company for Food Industries and military production factories will be responsible for supplying goods to Carry On branches.
In the same context, Al-Sayed Burei, head of the Food and Subsidized Groceries Division in Beheira Governorate, considers that the “Carry On” project should be viewed as a project to convert approximately 40,000 subsidized food outlets into a unified commercial chain based on a bulk purchasing system, rather than merely a change in name or visual identity of the outlets. He affirms that the concept currently being discussed was previously proposed by the General Division of Food Commodities around two years ago, before the official announcement of “Carry On,” with the aim of enabling subsidized food outlets to operate within a unified purchasing system that allows them to obtain goods at lower prices, benefiting both the consumer and the trader.
He tells Zawia3: “The proposed system is based on unified pricing and full automation, whereby goods prices are monitored through a unified electronic system, which limits price variation between different governorates and regions.”
He considers that the priority should be securing goods at appropriate prices for the citizen, rather than focusing on the external appearance of outlets and changing their visual identity, and limiting the development costs of subsidized food outlets, particularly given that most of them already operate within an automated and equipped system. He affirms that many of the implementation details, including which entities will be responsible for supplying goods and the mechanisms of application, have not yet been finalized.
He considers the success of the project to depend on the implementation of a unified bulk purchasing system that allows for negotiating large quantities of goods, which could reduce purchase prices and increase the capacity of small outlets to compete with major commercial chains.
He considers the primary beneficiary of the project to be the consumer, who will be able to obtain goods at more stable prices, alongside the trader’s benefit from improved profit margins through lower purchase costs and increased trading volumes.
He notes that the General Union of Chambers of Commerce called for a meeting with representatives of the Division and subsidized food dealers on 8 June to discuss the project details, explaining that the goal is to reach a framework that guarantees the protection of small traders’ interests and avoids repeating the problems that accompanied previous implementations in the subsidized supply system.
Burei recalls the experience of imposing financial deposits on subsidized food dealers in 2017, considering that it did not achieve the results promised to traders at the time, which makes them more cautious toward any new project. He therefore stresses the necessity of announcing implementation mechanisms and guarantees clearly before actual implementation begins.
Despite these reservations, Burei expresses cautious optimism about the project if implemented according to the vision proposed by the Division, noting that it could represent a “turning point” for subsidized food outlets by enhancing their competitiveness and improving the conditions of traders who have for years suffered from low profit margins and high operating costs.
Restoring Balance or Distorting Competition?
On the other hand, the project raises concerns about undermining the principle of competitive equality in local markets, given that it is expected to encompass 40,000 outlets that will compete strongly with supermarket chains and grocery and food stores in Egypt, enjoying a price advantage that may affect employment opportunities linked to those businesses.
When asked about the project’s impact on retail traders outside the subsidized supply system and “Gamiety,” Hazem El-Menufi, a member of the Food Commodities Division at the Federation of Egyptian Chambers of Commerce, affirms that the fundamental goal of the project is not to harm any party, but to achieve market balance by providing goods at fair prices, which would push various sales outlets to offer more competitive prices in favor of the consumer.
He explains that converting subsidized food outlets and “Gamiety” branches to operate under the unified “Carry On” brand comes within the framework of a national project adopted by the state to develop the domestic trade system and expand the availability of goods to citizens.
Although some subsidized food outlet owners have concerns regarding the development and qualification costs required for joining the new system, El-Menufi considers that initial indicators point to the existence of facilitations, support mechanisms, and financing aimed at alleviating the burdens on participating traders.
He tells Zawia3: “The state seeks to leverage the wide geographic spread of subsidized food dealers and ‘Gamiety’ branches, as sales points close to consumers in various areas.”
The member of the Food Commodities Division notes that the new system is built on a partnership and coordination between the Ministry of Supply and Internal Trade, the Future of Egypt Authority, and the Ministry of Agriculture, ensuring the provision of goods at appropriate prices and the achievement of market balance.
He points out that the products offered by the Future of Egypt Authority are priced lower than their equivalents on the open market, which reflects positively on the consumer and contributes to price stabilization. He adds that the implementation details and mechanisms are still not fully clear, and the final picture of the project will become clearer once the governing executive decisions and procedures are issued.
In contrast, Moamen Ashraf, a researcher in procurement policy and defense cooperation, raises questions about the financial burdens that may be imposed on small subsidized food outlet owners in the event of a transition to the unified “Carry On” brand, particularly given their currently limited profit margins, which are calculated in piasters on subsidized goods, making their capacity to bear additional costs questionable.
The researcher explains in a post on his personal Facebook account that the circulating development requirements, which include renovating shop fronts, installing new equipment, and adopting electronic operating systems, may push some outlet owners to resort to borrowing in order to implement them.
He notes that the information circulating about the new system includes talk of the participation of various entities in management, operations, and supply, which requires, from his perspective, greater transparency and disclosure regarding the nature of contracts, financing mechanisms, and the distribution of profits and responsibilities among the various parties.
In his assessment, outlet owners who already suffer from weak returns may find it difficult to meet new financial obligations if no support or concessional financing mechanisms are made available to them. He warns that implementing the new system on a mandatory basis could lead to the exit of some small outlet owners from the market if they are unable to meet the development requirements, which could in turn affect the livelihoods of the millions of citizens who depend on these outlets for their subsidized food needs.
