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How UAE is fighting price rises, inflation

Suppliers must submit evidence to justify hike in cost of essentials like milk, bread, rice

The UAE is doing all it can to limit the impact of global price rises and inflation, the country’s Minister of Economy has said. Abdullah bin Touq Al Marri said commodity price hikes are a global challenge and that the ministry has “well-studied policies and plans” to contain any unjustified increases in the country's markets.

He said the ministry is handling the issue by “trying to achieve a balance between the consumer’s interest in obtaining goods at reasonable prices on the one hand, and ensuring the sustainability of supplies” on the other. Maintaining supplies is a “national priority” that serves the country’s food security policies, he said in an interview to state news agency Wam.

The ministry is working with local economic departments and chambers of commerce, as well as relevant partners from the private sector, to study the global price rises of commodities. They then work together to “limit the impact of any global price increases in those commodities on the final products sold in the country's markets”.

“Strengthening the UAE’s consumer protection system and drafting relevant policies are national priorities, and we are working through the ministry and the Supreme Committee for Consumer Protection to implement them. (This will help) ensure sound commercial practices in local markets, maintain the availability and diversity of basic commodities in quantities that meet the needs of citizens and residents of the country and increase strategic stocks,” the minister told Wam.

Earlier this year, the ministry approved a new policy to keep price hikes of basic food items in check. Suppliers will have to submit evidence to justify price increases of some of the most sought-after items such fresh and dry milk, fresh chicken and eggs, bread, flour, sugar, salt, rice and legumes, cooking oil, mineral water and others.

Food prices in the UAE and worldwide have been on the rise mainly due to high freight rates, oil prices and the ongoing Russia-Ukraine military conflict.

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Retailers had earlier told Khaleej Times that they try to minimise the impact of any price increase by absorbing some of the impacts.

In the first quarter of this year, the UAE's inflation increased 3.35 per cent amid higher prices in 11 main sectors. The country's Consumer Price Index (CPI) jumped to 102.70 points in Q1-22, compared to 99.37 points in the year-ago period.

A YouGov Realtime study, which explores how inflation has affected people's cost of living in the UAE, says residents are cutting back on expenses. Eating out at F&B outlets (47 per cent) and spending on clothes and accessories (43 per cent) are the top areas where people have made cutbacks in the past six months.