FNC to study inflation

The Federal National Council's financial, economic and industrial affairs committee is to examine the Government's policies on inflation.

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ABU DHABI // A parliamentary committee is to examine the Government's policies on inflation. The Federal National Council's (FNC) financial, economic and industrial affairs committee will meet several times during the next few months before submitting its findings. Members had asked the Government to discuss inflation in July 2007, but the Cabinet only approved the FNC's request just before the last legislative season adjourned.

The committee is expected to hand its report to the FNC in the first session after the summer recess, which is scheduled for Nov 21. "We're very happy that the Government has approved discussing the issue," Rashid al Marar, an Abu Dhabi member, said yesterday, adding that it took more than a year for the Government to respond to the request. Sultan bin Saeed al Mansouri, the Minister of Economy, was scheduled to attend the FNC's debate.

Mr Marar said the committee would organise later this month a workshop in which economic pundits and academics were expected to give their opinions on means to control inflation, which has affected all sectors, from property to food prices. Tuesday's FNC meeting took place amid some positive consumer news as inflation eased as a result of a major drop in oil prices. When the members first approached Cabinet last year, inflation had hit a 20-year high of 11.1 per cent.

This year, the inflation rate is not expected to be as high, observers say. Food prices have already begun to stabilise and diesel fuel has fallen by 10 per cent since July. Global food prices were also likely to be steady due to an expected high crop yield this year. Meanwhile, the Government has pledged to suppress any attempts by food dealers to increase prices during Ramadan, which starts on Sept 1.

Experts have attributed inflation, in part, to rising property prices. Housing shortages could lead to further increases in property prices and rental costs. mhabboush@thenational.ae