For 25 years, one of the nation’s most beloved dessert – the McDonald’s soft serve Ice Cream Cone – was priced at AED1 ($27 cents).
Now, with global inflation crippling markets and supply chain shortages, the milky white scoop has doubled in price to AED 2, adding to the woes of many in the UAE.
“We started offering the ice cream cone for AED 1, 25 years ago. Since then, the cost of operations, equipment, labour and raw materials have increased, and in turn we kept on resisting changing the price,” McDonald’s UAE chief executive officer Walid Fakih told Arabian Business.
The price change, which was first instituted at some restaurants at the beginning of 2022, has been gradually rolled out to McDonalds UAE stores throughout the year.
It wasn’t easy to resist upping prices, Fakih said, adding the fast food company even “reached a point” where they were faced with a choice of either to stop serving the ice cream cone or continue serving it with a nominal price increase.
“Keeping in mind the reputation and appeal of the product we had to take the difficult decision to apply the slight price increase of AED 1 so that our customers continue enjoying the Ice Cream Cone they always loved,” Fakih said.
The price increase, while affordable, is presumably a sign of what’s yet to come as inflation continues to rise around the world.
“Inflation of 7.1 percent in Dubai and higher in the US and parts of Europe reflect rising prices of goods and services that we all purchase,” Oxford Economics chief economist Scott Livermore told Arabian Business.
Livermore said higher food and energy prices that are driving high inflation are felt by everyone and, most acutely, by those households with lower incomes already on tight budgets, adding that the Ukraine-Russia conflict contributes greatly to these rising prices.
“[The Ukraine-Russia conflict] disrupts the supply of key commodities either directly or indirectly via sanctions. This has contributed to a rise in agriculture and energy commodity prices that raise the production costs of business and are passed onto consumers,” he said.
While world prices for kitchen staples like milk and sugar have reached new highs due to the ongoing conflict and soaring energy rates, the UAE continues to implement policies to curb the effects of inflation.
In July, it was announced by the UAE Ministry of Economy that traders looking to increase rates of 10 basic staples in the country, must first seek approval.
The list of protected items included cooking oil, eggs, fresh milk, rice, sugar, fresh poultry, bread, flour, cleaning detergent and legumes such as lentils, peas, chickpeas and beans.
The Ministry of Economy implemented these measures to closely monitor and keep the prices of these goods in check.
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