Abu Dhabi plans index to stamp out price manipulation as construction costs soar.
Abu Dhabi plans to launch a price index for building materials in a move aimed at curbing price manipulation asconstruction costs soar in the UAE.
The Department of Planning and Economy (DPE) said the index will include 22 products that make up 90 percent of basic construction materials.
“The building materials' price index will expose traders who manipulate prices in this vital sector amid the current economic boom in Abu Dhabi in particular and the UAE in general,” the DPE said in a statement carried by state news agency WAM.
“Soaring fuel prices and international high transport cost also contributed in increasing prices of many basic construction material prices.”
The DPE said some building material prices fluctuated in June, with iron pipe rising by 19 per cent compared to the previous month, spiral iron up by 17 percent and round bar iron climbing 4 percent.
Other prices of building materials were stable in June compared to May, it said.
Building materials make up around 30 percent of a developer’s costs, with labour and plumbing, electro-mechanical and interiorFinishing (PEM&I) making up the remaining 70 percent, according to HSBC.
The DPE last week launched its first consumer price index (CPI) comprising 53 food items, which make up around 15 percent of family spending in Abu Dhabi.
The increased emphasis on monitoring price trends comes as the UAE is battling to control soaring inflation, which hit a 20-year high of 11.1 percent in 2007.
The DPE said last month that inflation in the UAE capital hit 11.7 percent in 2007 and held at 11.5 percent in March.