Crisis Complex, Multi-headed, Multilateral’; Government Admits Wave Of High Prices Hit Kuwait

The high cost of living in Kuwait is an undeniable reality and according to the Ministry of Commerce official rising prices are a global phenomenon that all countries of the world are suffering from during the Corona pandemic but the question is what has the Ministry of Commerce done or rather what measures has the ministry taken to keep a tap on rising prices.

Al-Qabas quoting the ministry official said the control and consumer protection sector is confronting the artificial rise but is the sector’s role sufficient to contain the crisis?

An ordinary government official who went on a shopping trip, whose main goal was to escape the stress of daily work, allegedly turned into a shocking reality.

“What people talk about the wave of high prices hitting Kuwait is an undeniable reality,” he said. The hike in prices have affected food, consumer and construction materials in an unprecedented manner and has caused extensive damage to factories and projects.

“Now we have a case, in which the perpetrator is the price hike, the market is affected, and the citizen pays the price.” On this basis, the government official’s thoughts swirled, which prompted him to dive into the details of the official correspondence related to the issue of high prices.

The Commerce Ministry says the sector always coordinates with the competent authorities to ensure the availability of goods and to address any causes of price increases. After exchanging questions and answers, the reasons given for the high in prices were all external, not local, and were summarized as follows:

1 – The increase in the prices of raw materials in the world markets.

2 – Weak global and local production and weak supply.

3 – The high cost of land and sea freight.

4 – Lack of manpower.

5 – The spread of diseases in the products exporting countries.

6 – A global rise in feed prices.

7- High storage prices due to the scarcity of stores.

8 – Scarcity of containers.

What the government disclosed in this regard was approved by the Ministry of Commerce and Industry in response to a parliamentary question, a copy of which was obtained by Al-Qabas, in which it confirmed the rise in food, consumer and construction prices and the serious damage suffered by the local market as a result.

The ministry promised an imminent report to be submitted by an advisory committee, which was formed in the wake of the ministerial decision issued at the end of last August. The report will carry recommendations to confront this rise, which will be placed on the cabinet table to take the necessary decisions in this regard.

And while the government advisory committee is preparing to submit its recommendations to the Cabinet, international reports are putting great pressure on the government, as a report issued by MUFG Bank, the second largest Japanese bank revealed that the inflation rate in Kuwait has risen significantly and continuously for more than two years to reach the largest inflation rate among the Gulf states, after it was the lowest at the end of 2018.

The report of the Bank of Japan, in a comparison between inflation rates in the Gulf countries, indicated that the rate of price inflation in Kuwait reached a rate of slightly more than 3% on an annual basis, topping the inflation rates in the Gulf countries.

There is no doubt that the continuation of inflation globally is the title of the stage in light of the repercussions of the Corona virus, and the supply chain crisis it produced, as the raw materials for factories reached 90 waiting days, and later decreased to 56 days.

But is the supply chain problem over?

All indications say that the end of the supply chain crisis will not be near, especially due to the mutant “Omicron”, which is putting new pressure on supply chains after a slight improvement in the last period. Industry experts have warned that the supply chain crisis caused by the Covid-19 pandemic could last up to two years, according to a report by the British newspaper The Guardian.

In light of this complex reality of the issue of prices, local companies and importers of food and consumer goods see the need to raise prices on consumers, and requests in this regard have already been submitted to the Ministry of Commerce and Industry.

The companies justified their demand as follows:

► The high cost of raw materials in global markets.

► The boom in sea and air freight rates.

► High costs of labor and land transport outside the country.

“The crisis is complex and multi-headed and multilateral.” This is the summary of the findings of observers and government officials, but the government is considering and promising solutions, and it is assumed that they will be presented soon in a cabinet meeting.

 

SOURCE   :   TIMES KUWAIT

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