Kuwait to boost food subsidies to tackle inflation

CLOSE MONITORING: The government is to step up price inspections at supermarkets to stop shops overcharging customers. (Getty Images)

Kuwait will improve its food subsidies system and tighten controls to prevent unjustified price increases to curb inflation which hit a record 6.2% in September, state news agency Kuna said on Tuesday.

The measures, which were approved by the Gulf state's cabinet on Monday, include allowing Kuwaitis to buy 25% more of subsidised foods such as rice, vegetable oil and powder milk, Commerce and Industry Minister Falah Al-Hajeri told Kuna.

The Middle East's fourth-largest oil exporter has a system that allows Kuwaiti nationals to buy subsidised basic foods.

Other measures would be to improve quality of subsidised foods and remove the cap on the amount of subsidised baby milk citizens can buy, Al-Hajeri said.

The government will also intensify its monitoring of price increases at supermarkets, he said urging consumers to report shops charging exaggerated prices.

"The ministry will step up its monitoring of the local market to track down unjustified price increases," he said.

Kuwait, which pays for a about third of its imports in euros, broke ranks with its neighbours in May and dropped its dollar peg, saying the US currency's weakness was driving up import costs and fuelling inflation.

Citing a study by Al-Hajeri's ministry, Al-Qabas newspaper said the government also wants to prevent private firms from entering the residential property market to dampen price increases in the booming sector.

The government said in September it was worried about a jump in property prices and would try bringing them down to levels affordable to citizens.

On average, property sales rose 59% in the first eleven months compared with the year-earlier period, National Bank of Kuwait (NBK) said in a research report published on Monday. (Reuters)

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