Cairo – Egyptian Prime Minister Sherif Ismail defended his government by telling a news conference on Friday that the current stage Egypt is passing through is very critical stage.

On Thursday, the Central bank floated the Egyptian pound and raised interest rates while the petroleum Ministry increased prices of petrol and gas by between 30 and 50 percent.

Ismail told reporters: “Egypt did not have the luxury of postponing urgent economic reforms. The decision to cut subsidy on goods is not new, and we have to move forward and the Egyptian economy has to improve.”

“Thursday was an important day in the history of the Egyptian economy, with the moves in foreign currency and petroleum prices,” he said.

This comes at a time when Egyptians woke up on dollar hike crisis, and clashes erupted in some governorates between car drivers and gas stations’ owners after the hikes in fuel prices.

The clashes occurred because the owners of gas stations wanted to apply the new fuel price hikes at once, and not at the early hours of Friday as Hossam Arafat, the head of the petroleum products division in the Chambers of Commerce Union, had announced.

Moreover, hundreds of cars, trucks and taxis stationed in lines in front of gas stations in all governorates following the news about the increase in fuel prices, and drivers were very angry of the new price rise.

The reforms are part of a move to get the International Monetary Fund board’s approval for a $12 billion loan package to be delivered over three years.

Ismail said the economic program aims to decrease the budget deficit, which currently stands at 12.2 percent of GDP, to less than 10 percent.

The economic reform program, according to the Prime Minister, will aim to increase taxes and reduce state subsidies.

He also said that the majority of the state budget was being exhausted on subsidies, leaving only EGP 200 billion to spend on health, education and other services.

Regarding tourism in Egypt, Ismail pointed out that talks are being held with Russia in order to restore Russian tourists.

The number of tourists visiting the country declined after the downing of a Russian plane last year over the Sinai Peninsula by Sinai Province – a group affiliated to ISIS as well as a mysterious crash of an Egypt Air flight over the Mediterranean this year.