Font Size

- Aa +

Wed 2 Sep 2015 01:53 PM

Font Size

- Aa +

Bahrain again postpones plan to remove meat subsidies

Prime Minister gives order to delay move after facing opposition from some MPs

Bahrain again postpones plan to remove meat subsidies
Bahrains Prime Minister Sheikh Khalifa bin Salman Al-Khalifa (Getty Images)

A proposal to scrap meat subsidies in Bahrain from September 1 has been postponed for another month, following an order from the prime minister.

Bahrain has for some time mooted removing government subsidies on red meat – and potentially other goods such as fuel and energy at a later date – in order to save money as low oil prices eat into its national budget.

However, the government has faced opposition over the plans from some MPs. And, although the country has pledged to compensate Bahraini citizens for the higher cost of such products, the plans remain controversial.

Earlier this summer it was announced that meat subsidies would be axed from August 1, but this was pushed back to September 1, and has been postponed for another month as the plans are reviewed in parliament.

In a statement issued by state news agency BNA on Wednesday, deputy premier Sheikh Khalid bin Abdulla Al Khalifa said: “The delay reflects HRH the Premier’s keenness on consolidating cooperation with the Council of Representatives and Shura Council and discussing economic issues and citizens’ standard of living.”

A panel of officials will now discuss all plausible alternatives and options with the relevant government departments, which, said BNA, are still supplying the government’s specialist subsidies committee with necessary data.

There are concerns that meat subsidies axe would have damaging financial repercussions resulting from the sharp decline of oil prices in world markets.

However, BNA reported that the prime minister has been “reassured” on proposed measures to protect consumers and ensure free competition once meat prices are deregulated.

And it said that Bahraini families wishing to receive compensation for anticipated higher costs of living to register online when a portal run by the Central Informatics Organisation opens in the coming days.

The database will enable the ministries of finance and social development to compile a list of eligible recipients and start cash compensation payouts from October.

BNA said a total of 116,000 Bahraini families already receive financial aid under government-funded grant programmes and will be exempted from registration as they will receive cash compensation automatically in their bank accounts once the policy takes effect.

Bahrain’s industry and commerce minister Zayed bin Rashed Al Zayani said last month that the removal of subsidies would help to stimulate meat imports into Bahrain by encouraging more importers to get involved, according to a report by Reuters.

However, Zayani did not reveal how much money the government expected to save by removing meat subsidies.

A state budget approved last month forecast a deficit of 1.50 billion dinars ($3.98 billion) in 2015, up from an originally planned deficit of 914 million dinars last year.

For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.