UAE Ministry of Economy signs MOU with Bani Yas Cooperative Society to fix prices of basic food commodities
Alshihhi: Ministry of Economy will continue efforts to reduce high prices in the UAE despite it being a global problem
The UAE Ministry of Economy and Bani Yas Cooperative Society have signed a Memorandum of Understanding (MOU) pegging the prices of 56 basic food commodities to 2007 levels.
The MOU was signed at the Abu Dhabi headquarters of the Ministry of Economy today (Tuesday, April 29, 2008) by H.E. Mohammed Ahmed bin Abdulaziz Alshihhi, Undersecretary, UAE Ministry of Economy; and Mr. Saeed Khalfan Matar Romaithi, Managing Director of the Bani Yas Cooperative Society, in the presence of Ministry officials and Cooperative representatives.
H.E. Alshihhi confirmed that the signing of the MOU with the Bani Yas Cooperative Society is in line with a series of initiatives and actions taken by the Ministry of Economy as part of its responsibility to reduce the prices of various goods and services; aiming to maintain market balance and reduce inflation to implement the national strategy of achieving economic and social stability in the domestic market.
H.E. also emphasized the significance of the timing of the signing of the MOU with Bani Yas Cooperative Society and with other societies and private companies operating in the domestic retail sector at a point when global data point to a rise in food prices in world markets. These efforts have the potential to lessen the negative impact of this global problem on the local market and contribute in stability and balance both in the present and the immediate future.
“Although the increase in food prices is a global problem affecting most countries in the world, we will still continue our efforts in collaboration with other concerned parties to bring down high prices in the domestic scene caused by monopoly or exploitation, which threatens the stability of the market. These initiatives are part of government and overall efforts to reduce the rate of inflation through economic and social policies that control the prices of goods and various services," said Alshihhi.
He emphasized that the Ministry of Economy, in cooperation with other concerned parties, will continue to vigorously fight any monopoly or exploitation that could threaten market balance, explaining that the task of maintaining market stability and consumer protection are not confined to the Ministry of Economy, but are rather shared responsibilities that combine federal and local efforts with the vigilance of civil societies to stop negative practices that are detrimental to the consumer, the community and the national economy.
He also confirmed the government's rejection of monopoly in all its forms and its stand against any action or misconduct aimed at influencing prices and distorting market forces, explaining that the government seeks to control rising costs by promoting economic freedom and fair competition.
In addition, he pointed to the proactive action and practical steps taken by the government in this direction, highlighting the decision to release information on 16 agencies and basic food commodities and applying the idea of collective purchasing of consumer goods and the exemption cement and iron importers from customs fees, which led to the delivery of products at prices that did not compromise quality and supply. He also called for enhanced cooperation between the public and private sectors, particularly cooperative societies, in combating the phenomenon of rising prices and its economic and social effects.
“This MOU is a result of the cooperation between the Ministry of Economy, as a governmental body that seeks to stabilize consumer prices within the UAE and protect consumers using various methods and tools to support economic stability and address unfair trade practices that harm consumers; and Bani Yas Cooperative Society, as one of several cooperative societies that operate in the retail and wholesale sectors, in order to maintain the stability of prices and work on creating competitive markets that veer away from monopoly and fraud while offering quality, safety and competitive prices.
Under the memorandum, Bani Yas Cooperative Society will maintain the prices of 56 basic food commodities at 2007 levels during the same period. The products include various types of rice; sugar; oil; flour; margarine; tea; salt; dairy products; tomato; paste; legumes; chicken; meat; cheese; eggs; water; and bread.
The Government and Bani Yas also seek to extend their cooperation in the technical and legal fields and to exhaust all measures to ensure the achievement of cooperation and coordination in all relevant areas, especially in the commitment to maintain the agreed listed prices of goods between the two sides in 2008. They will also exert effort to cooperate on developing a long-term strategic partnership that achieves the goal of the MOU and seeks to take the necessary actions to support the stability of the retail/wholesale market, in accordance with UAE laws and systems as well as internal regulations adopted by Bani Yas Cooperative society. They also agreed on the submission of periodic reports to the Ministry of Economy that will provide updates on the results of the implementation of this memorandum.
Alshihhi lauded the positive response of Bani Yas Cooperative Society to the invitation of the Ministry of Economy, saying: “This response to the initiatives of the Ministry of Economy to stabilize prices at 2007 levels confirms the vital and effective role to be played by cooperatives in the state and their desire to achieve stable commodity prices and maintain market balance.” H.E. Alshihhi also stressed the importance of the role of cooperative societies in meeting the local market’s need for goods at competitive prices through direct importation of several food commodities from their basic sources, as they succeed in creating a parallel market to curb unjustified price hikes and contribute to the fight against monopolies and exploitation, which undermines the concept of market competition.
He further explained that the Ministry of Economy has launched an initiative to stabilize prices in cooperative societies and major retail centers in the UAE, in direct collaboration with cooperatives, private companies and major suppliers of goods and food products, so as to ease the burden of the citizens and residents of the UAE. He also stressed that the experience of the UAE in this regard is unique at the local, regional and global levels, indicating that the Ministry of Economy intends to convince suppliers and dealers of basic commodities in local markets to join the initiative in efforts to stabilize the domestic market and reduce the inflation rate particularly for consumer products and food commodities.
He stressed significant and persistent government efforts to encourage the cooperative role of societies and their activities according to the goals they established in view of the great importance of these societies in serving the country and participating in the social and economic development.
The Ministry of Economy recently signed several similar MOUs with various cooperative societies and major retail companies operating in the UAE market, including Carrefour UAE and Lulu Hyper Market, while other cooperative societies responded to the Ministry's invitation to sell selected commodities at cost, in line with within sustained efforts to reduce high prices and curb inflation.
The UAE Ministry of Economy aims to protect consumers and their rights by strictly enforcing Federal Law No. / 24 / for 2006 on consumer protection and its implementing regulations and decisions issued in this regard. This will be achieved by upholding the state’s general policy for the advancement of the national economy and consumer protection in collaboration with concerned government agencies; this ensures that services, consumer goods and other materials are of high quality, comply with UAE standards and do not harm the consumer. The Ministry is also working to support the national economy and coordinate with concerned bodies to address business practices which influence the national economy and help achieve the principle of fair competition by deterring negative activities such as monopolies.
