Subsidies—Love Them or Hate Them, It’s Better to Target Them

iMFdirect - The IMF Blog

By Masood Ahmed

(Version in عربي)

For decades, countries in the Middle East and North Africa have relied heavily on food and fuel price subsidies as a form of social protection. And, understandably, governments have recently raised subsidies in response to hikes in global commodity prices and regional political developments.

Like many things, there may be a time and a place for using subsidies.But, they need to be better targeted. And, often, there will be better alternatives. Alternatives that do a better job of protecting the poor.

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