After the prices of some imported goods recorded a 10% increase in new orders

Two experts: The inflationary wave is temporary... and the effects are limited and ineffective on consumers

• Spending on consumer goods accounts for up to 25% of household budgets.

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Sales outlets officials said that the prices of a number of imported goods recorded an average increase of 10%, in new orders.

They attributed this to the rise in energy prices, a significant rise in global demand as a result of increased consumption, and the start of the recovery of a large number of economies, after the end of the peak of the Corona virus “Covid-19” pandemic.

In turn, two economists ruled out a significant impact of the global price hike on consumers in the UAE, despite the fact that it imports a large proportion of its needs from abroad.

They told «Emirates Today» that the inflationary wave is temporary, but it is difficult to determine the time period it takes, calling on the Ministry of Economy and the authorities concerned with the market and prices, to stand firmly against any attempts to exploit the global price hike for some commodities, by not allowing an increase in the prices of any commodity without the approval of official from the ministry.

Last week, data from the Federal Competitiveness and Statistics Center showed an increase in annual inflation in the UAE for the first time in more than 32 months, as consumer prices rose by 0.55% during August 2021, compared to August last year.

New orders

In detail, a field tour of "Emirates Today" showed that there were increases in varying proportions in the prices of a limited number of goods, in some outlets, with the continuation of weekly discount offers on a large number of food and consumer goods.

A senior official in a sales outlet with branches in a number of emirates, (M.N), said that the prices of a number of imported goods witnessed increases by an average of 10%, in the orders of new goods that were concluded in the recent period, and some of them reached to the UAE market and the countries of the region, while the rest will arrive in the coming weeks.

He explained that this rise is driven by the rise in energy prices, and the occurrence of a significant increase in global demand during the recent period, expecting that the prices of a number of commodities will witness varying increases in the coming months, with the conclusion of more new orders.

In turn, an official in another outlet, (RA), said that new orders began arriving in the UAE market with varying price increases, according to the nature of the commodity and the country of origin.

He attributed the current and expected future rises to increased consumption, the start of recovery for a large number of economies, and the return to normal life after the end of the peak of the Corona virus (Covid 19) pandemic.

Limited Effects

As for the marketing officer in a large outlet, Hassan Rizk, he expected that the upcoming price hikes will have a limited and not significantly impact on consumer demand and consumer spending in the local market, in light of the low rates of price increases, and the rise in the standard of living and salaries in the country.

In the same context, Ibrahim Al-Bahr, a retail expert and head of Al-Bahr Consulting Company, said that local reports confirm the start of a rise in the prices of a number of goods and services during the recent period, driven by a strong increase in global and local consumer demand, after life began to return to normal again. The repercussions of the “Covid-19” pandemic have receded on many major economies in the world.

Al-Bahar ruled out a significant impact of the price hike on consumers in the UAE, despite the fact that it imports a large proportion of its needs from abroad.

He said that the expected increases have a limited and non-significant impact on consumer demand and consumer spending in the UAE.

Al-Bahr explained that spending on consumer goods in general accounts for up to 25% of the families’ budget, which affects families’ spending in the event that the prices of goods rise significantly, calling on consumers to be careful before buying, and to refrain from buying goods whose prices rise without justification, so as not to The family budget is affected, with the resort to alternative goods.

Al-Bahr also called on the Ministry of Economy and the competent local authorities to stand firmly against any attempts to exploit the global rise, which is reflected locally, by not allowing an increase in the prices of any commodity without the official approval of the Ministry, especially the main commodities, after studying the entire situation, and taking Strict measures against any outlet or merchant who tries to take advantage of the situation and raise prices without justification.

power and charging

In addition, economist Ali Al-Hamoudi said that the inflationary wave, and the accompanying rise in the prices of consumer goods, has already begun to show its effects in the markets, which is noted in the rise in the prices of a number of local and imported goods.

Al-Hamoudi attributed this rise, in the first place, to the rise in global energy prices, freight and container prices, as well as the rise in the prices of primary raw materials, which was reflected on global supply chains, pointing out that the producing companies can bear that rise for a few months, not long, and therefore , forced to increase prices, as a result of the impact of the increase in energy, freight and raw materials prices on the cost of its operations and its quarterly and annual profits.

Al-Hamoudi continued: “The inflationary wave is temporary, but it is difficult to determine the time period that it will last, and it is inevitable that it will be reflected on consumers, even in a limited way,” noting that its continuation is also linked to the movement of central banks in the world, to take measures to reduce inflation, such as Raising the interest rate, especially since raising the interest rate reduces spending, consumption demand, and increases saving, which leads to lower inflation.

negative effects

Economist Ali Al-Hamoudi warned that inflation waves are accompanied by negative effects on economies in general, such as a decline in investment, weak purchasing power of different currencies, as well as companies’ delay in hiring operations, which leads to an economic slowdown, especially in energy-consuming economies, considering that This is undesirable during the current period, especially since the world's economies have begun to recover after a difficult period as a result of the repercussions of "Corona".

He said that it is in the interest of the various countries of the world that the price of oil remains between 60 and 70 dollars per barrel, and that it does not record increases exceeding this level, given its effects on the global economy and the occurrence of recessions in some economies.

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