H.E. Eng. Sultan bin Saeed Al Mansouri, the UAE's Minister of Economy and chairman of the Union Cooperative Society Majed Hamad Al Shamsi have signed a Memorandum of Understanding (MoU).
The move will witness the retailer implement the first phase of a program aimed at preserving the 2007 prices of more than 16 basic food items throughout 2008.
The initiative is in line with the MoE's efforts to stabilise prices, reduce inflation, sustain market balance and protect consumers in light of possible price rises of these items within local and international markets.
The program is also part of an effort to highlight the integral role the UCS plays in controlling monopolies and combating the high cost of living.
H.E. Sultan Al Mansouri praised the initiative of the UCS and Abu Dhabi, Al Dafra, and Sharjah cooperative societies. "The Union Cooperative Society's first-phase initiative in fixing the prices of more than 16 goods underscores the vital role that co-op societies in the country can play in stabilising commodity prices and preserving market balance."
"Last week the Ministry of Economy honoured the UCS for its vital role in supporting the principle of cooperation and bridging the price gap at local markets through direct imports of various food commodities from their basic sources; in which it successfully reduced un-justified price rise. The UCS is continuing with its pioneering initiatives to combat monopolies and exploitation, which are against healthy completion in the market," H.E. added.
Under the terms of the MoU, Union Coop will outline and implement a program in the next few weeks to preserve 2007 prices of basic food items throughout 2008, among which include oil, rice, flour, eggs, sugar, powdered milk, tea, meat, chicken, fish, and bread.
H.E. Sultan Al Mansouri called on other cooperative societies in the UAE to follow UCS' example and participate in such initiatives by collaborating with the MoE and other concerned bodies to reduce inflation, preserve market balance, and facilitate the most effective supply and demand mechanisms to maintain the UAE's economic attractiveness.
H.E. Al Mansouri stressed the UAE Government's continuous efforts to maximise the benefits of co-op societies, according to the objectives of their establishment such as promoting and participating in the socio-economic development of the country.
He added that the MoE, in cooperation with other concerned bodies, will continue to work towards combating any type of monopoly or exploitation that may threaten market stability, noting that consumer protection was the joint responsibility of local and federal efforts to prevent passive practices that affect consumers, the society and the national economy.
Majed Al Shamsi said the initiative was based on the UCS' commitment to serving the society and contributing to the development of vital sectors such as education, health, charitable work, and joint-partnership between public and private organisations.
He emphasised that it was important for co-op societies to focus on the commercial aspects of their roles and to preserve price stability.
Khalid Humaid Al-Falasi, general manager of the UCS, explained that the initiative to fix prices of various basic food items is based on the Society's objectives to maintain price stability for the retail sector in Dubai in particular, particularly basic food goods representing up to 40% of consumer purchases.
He added that the move was prompted by expectations that the prices of the basic items specified in the initiative would rise by 25 to 30% during 2008, while indicating that the UCS would bear the burden of these rises, costing the company AED 40 million.
According to Al-Falasi, the Union Cooperative Society contributed to reducing prices through alleviating profit margins by AED 14.6 million to address the rising cost of living during 2007.For all the latest retail 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.
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