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Wed 12 Mar 2008 12:00 PM

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UAE agrees food discounts with Co-ops

Union Cooperative Society chain to sell 16 basic foods at cut prices to nationals - ministry.

The UAE Ministry of Economy said on Wednesday it agreed to allow the Union Cooperative Society chain of markets to sell 16 basic foods at a discount to help offset the effects on inflation.

The agreement covers goods such as cooking oil, rice and flour, the ministry said in a statement.

"The price of the dollar is getting weaker and the price of oil is going up," Ministry of Economy Undersecretary Mohammed Ahmed bin Abdul Aziz told reporters in Dubai. "Our efforts to curb rent with rent caps and controls of food prices will help reduce the impact of inflation."

It was not immediately clear how the price-fixing mechanism, which will be introduced in phases during the year, will work.

Inflation in the second-largest Arab economy hit a 19-year high of 9.3% in 2006 and probably accelerated to 10.9% last year, the National Bank of Abu Dhabi (NBAD) said last month. The UAE's economy grew 7.6% last year.

The UAE is considering a plan to give its citizens discounts on 14 food items, gasoline and cooking fuel to help offset inflation, the head of a consumer protection body said on Tuesday.

The cabinet is studying the plan, which will allow UAE nationals to buy rice, bread, tea, sugar, milk, butter and other basic food items at cost, said Jamal Al-Saeedi, executive manager of the Emirates Society for Consumer Protection (ESCP).

Food prices in the UAE, which pegs its dirham currency to the falling US dollar, will probably jump 40% this year after surging 30% in 2007, Al-Saeedi said last week.

Gulf Arab oil producers are trying to offset inflation by introducing price controls on rents, subsidising food and raising wages.

Earlier this week, the UAE's Economy Ministry set a ceiling on the maximum price retailers are allowed to charge for some basic food items to help stabilise prices. (Reuters)

Muhammad Irfan Khan 11 years ago

I wish the rulers of UAE new exactly what Islam teaches about equality. Allah will definitely question them.

M Thomas 11 years ago

I do not know whether this was a case of mistaken reporting or these were the exact words. It is quite unfortunate if it is true as this degenerates into pure discrimination.. What purpose does all the humanitarian effors serve if it is not practised in one's own country? Quite sad and unfortunate

Margarite 11 years ago

Can someone please say where the nationals should go to get the cards to entitle them to the discounts? Do they go to the co-op itself or to an office or to the government? Can someone please answer that. My husband is a local and we desperately want to get a hold of the discounts. Thanks.