Co-ops start imports to curb inflation

August 13, 2008 at 4:25 am Leave a comment

Kuwait Times – August 13, 2008

KUWAIT: Kuwait’s cooperative supermarkets are starting to import basic goods directly from the source as part of efforts to curb soaring inflation in the state, a top official said yesterday. The world’s seventh-largest oil exporter, the only Gulf Arab state without a dollar peg, is fighting record inflation hitting 11 percent in April and May, driven by food and housing costs.

Mohammad Al-Ansari, the head of the Union of Consumer Cooperative Societies, told Reuters the organization was looking at importing seven basic goods to reduce prices at the till after the government allowed them to cut out middleman importers. “The ministry organized the import process so it goes through the union making it better and cheaper… merchants are making unbelievable demands to raise prices,” he said.

Goods that could be included in the new import policy range from rice, sugar, frozen chicken and vegetables to soap and detergents, Ansari said. “We did a survey on what consumers need in some co-ops… these are the goods we will start importing and then we will see if consumers need more items,” he said. From Tuesday on, if merchants raise prices of basic items then co-ops will not be allowed to buy those goods from them, he said. The move is intended to discourage merchants from introducing any further
hikes. Ansari said the union was also studying a proposal to set up a fund, to be funded by its stores, to organize imports.

Commerce & Industry Minister Ahmad Baqer told the Al-Qabas newspaper that the government would hold a final discussion of recommendations by a committee in charge of anti-inflation strategy tomorrow. He said the committee had made more than 20 recommendations costing tens of millions dinars. The proposals include a increasing the range of subsidized products and helping firms in sectors such as livestock and flour milling to reduce prices for consumers, state news agency KUNA said late on Monday, citing a
Cabinet statement.

Separately, Kuwait will provide nationals with basic food items during the holy month of Ramadan to offset the impact of inflation, Crown Prince Sheikh Nawaf Al-Ahmad Al-Sabah told Al-Rai newspaper. “Government decisions regarding this matter will be issued soon,” he said. The Cabinet has raised salaries for nationals in the public service twice this year.

In June, Baqer also told parliament Kuwait could work with fellow Gulf Arab states to invest in food production and farming to secure food supplies against global price rises. Kuwait has leased rice fields in Cambodia and plans to import food from the Asian country, Foreign Minister Undersecretary Khaled Al-Jarallah, who is with Prime Minister on an Asian tour, told Awan newspaper last week. – Reuters


Entry filed under: Economy and Trade, Politics. Tags: , .

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