The inflation battle is on

Government officials have vowed to tackle the kingdom's inflation worries and the social impact of soaring commodity prices.

At the beginning of the year, the government, headed by Prime Minister Shaikh Khalifa bin Salman Al Khalifa, pledged to deal with the situation and called for an end to "useless arguments and pointing fingers instead of resorting to dialogue to find solutions."

Over the past few months legislative and executive bodies have stepped up their efforts to ease inflation and the impact of global price rises without resorting to revaluation or un-pegging from the dollar.

The government news agency reported that officials are dealing with the crisis by "enhancing competitiveness, removing restrictions on commodity flows and blocking commercial activities that may harm consumers".

Among the government's options to ease the burden on consumers are food price controls and efforts to subsidise peoples' incomes.

Officials say they plan to maintain the subsidies on basic foodstuffs such as flour, meat and chicken, as well continuing the subsidies on fuel, electricity and water.

In 2006, the government spent BD12 million to subsidise flour, meat and poultry. The following year it spent BD17 million, and this year the number is expected to reach BD30 million.

Earlier this year, Industry and Commerce Minister and chairman of the Committee for the Management of Foodstuff Subsidisation, Dr Hassan Fakhro, recommended that government foodstuff subsidies should be provided in the form of a monthly allowance for "deserving families."

The allowances would be awarded according to family size and income.

Head of Food and Agriculture Committee at the Bahrain Chamber of Commerce and Industry, Ibrahim Aldaaysi, said that introducing price controls was a bad idea.

He said: "In my personal opinion implementing price controls is a very bad idea. It disturbs the power of the market and we will have a much more difficult situation to deal with later on if we do implement them."

He thinks that Bahrain's best option is to subsidise citizens' incomes.

He added: "I can't see any other way. Although it's very hard to do so, I think it's the easiest, fastest, least expensive and most stable option.

"Bahrain cannot prevent prices from rising but if we work together with government, citizens and traders, we can increase competition and help to keep prices down. That's the reason historically why food prices have been kept at a reasonable level."

The ministry's Consumer Protection Directorate also said it is conducting market studies of more than 15,000 goods each month in order to analyse market trends.

Acting assistant under-secretary for Consumer Protection, Mohammed Ali Ajoor, said that soaring prices are an international phenomenon but that the ministry was doing its best to curb them through a package of regulations.

He said the directorate had "spared no effort to track violations and price manipulations and took severe measures against the perpetrators", but he also attributed part of the problem to consumers' "consumption habits".

As concern over regional food security grows, the Prime Minister voiced his concern at his weekly majlis earlier this month, saying that the price hike sweeping across the region should trigger serious concern regarding food security in the region.

He told journalists: "We need to draw lessons from the current spiralling inflation hitting the world and start seriously thinking about ensuring food security in the Arab world, particularly that our countries have immense potential and resources that can be used to ensure a better future for our people."

He suggested that the region's vast arable lands be used to help establish food self-sufficiency.

Consumer Protection Society deputy chairman Abdulhameed Khalil Al Suwaihadi's offered his cost-saving advice to consumers:

Consumers should avoid random and extravagant shopping which has become a distinctive characteristic of Gulf consumers since the mid-70s.

Consumers should prepare shopping lists beforehand and manage their family budgets effectively.

They should compare products and prices and match them to personal tastes and budgets.

Consumers should be aware of the impact of promotional campaigns, avoid using big trolleys to limit purchases and refrain from stockpiling foodstuffs at home for future needs in case of inappropriate storage.

Lifestyles should be also changed. Bahraini families are growing extravagant as most of them prepare large quantities of food that exceed the daily need of their family members, ending by throwing the extra amount in the rubbish in the evening.

Families should follow Prophet Mohammed's Hadith which calls on Muslims to eat the right quantities to keep them fit without extravagance.

Co-operation among consumers, traders and officials is required to surpass the present wave of price surge.