Business | Economy
Middle East struggles to control record inflation
Gulf Arab states launched emergency efforts to control soaring food and fuel prices on Tuesday.
- Reuters
- Published: 20:10 June 10, 2008
Dubai: Gulf Arab states launched emergency efforts to control soaring food and fuel prices on Tuesday.
In the Gulf, inflation threatens to damage rapid economic growth and derail plans to forge a currency union.
Qatar is to freeze the price of steel and cement for three years, while Kuwait prepared to unveil on Wednesday an anti-inflation plan, including new food subsidies.
Bahrain on Tuesday put a price for the first time on some of its inflation-fighting efforts, saying it spends $1.33 billion a year on subsidies for food and fuel.
Inflation in Gulf oil-producing countries will probably rise to at least 9 per cent this year as rents and commodity prices surge, the latest Reuters poll showed.
"Inflation remains a problem for macroeconomic stability and a problem that needs to be addressed," said Marios Maratheftis, head of research at Standard Chartered in Dubai.
"On the positive side, it is now widely acknowledged now by all the authorities that this is indeed a problem," Maratheftis said.
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