Petrol and parking
Inflation is back. Don't let anyone tell you otherwise.
Inflation is back. Don’t let anyone tell you otherwise.
Amid reports that single figure inflation is expected across the region in 2010 and that Dubai is experiencing year-on-year inflation lows, let’s take a moment to consider some facts.
The price of petrol has just gone up. Okay, that’s just in the UAE, but a rise is a rise. After years of double digit inflation, the authorities have taken the opportunity to get a much-needed price rise in, during a period when it won’t immediately make the economic data look bad. Smooth move.
Yes, you read that right, much needed. The cheaper something is, the easier it is to waste, and here in the Gulf we waste petrol big time.
Perhaps the petrol authorities took a lesson from Dubai Municipality, which doubled the base rate of metered parking from one dirham to two, just the other week. Not an outrageous sum by any means, but the law enabling the increase had been in place for a couple of years, and had not been acted upon.
The perpetual Salik dodgers among us can only hope the RTA has been preoccupied with finishing touches to the Metro’s Red line, else more Salik gates could be on the way too.
Price increases that will be felt throughout the Gulf include the construction commodities of steel and aluminium, which have both been on the rise. Copper has been trying to join them and while it has been a bit all over the place in 2010, it is heading vaguely upward.
This points to an increased cost of doing business. Headline figures for manpower costs may be down, in some cities rent has dropped too, but while big noticeable numbers are working to keep inflation low, others that lie at the heart of construction are on the way up.
If you can’t find the evidence in the inflation figures, try checking your bottom line.