Rising Food Cost

To combat the increase in food inflation, the Bahraini government has taken a number of measures, including providing subsidies for essential food products, such as meat and bread

The World Bank’s most recent report on food security, states that among the list of high-income countries, the Kingdom recorded a significant increase in food prices, ranging from between 5% to 30%.

Meanwhile Kuwait’s food inflation rate increased by 7.1%, Oman’s rose by 5%, Saudi Arabia’s climbed by 3.7% and Qatar reported a marginal increase of 0.3%. There is no official data available for the United Arab Emirates. The high inflation rate can be attributed to a number of factors, including the start of the Russian-Ukrainian war and the global supply chain crises, rising fuel prices, and supply chain disruptions caused by the COVID-19 pandemic.

It is worth noting that food inflation rates in other countries around the world are also increasing due to similar factors such as supply chain disruptions, and rising global food price. While the report states that 87.3% of high-income countries experienced a high increase in food price inflation.

The Central Bank of Bahrain has implemented monetary policies such as interest rate adjustments to manage inflation. Additionally, the government has implemented measures to promote food security and self-sufficiency, such as investing in agriculture and supporting local food production to reduce its dependence on imports.

As Bahrain relies heavily on imports for its food supply, these global factors have a direct impact on local food prices. Additionally, the introduction of value-added tax (VAT) in Bahrain in 2019 has also contributed to higher prices for goods and services. The impact of the increase in food inflation is being felt across Bahrain, with households experiencing a decrease in purchasing power due to higher prices for essential food products.