Price increases of up to 70 per cent on some food items could be resolved through bulk purchases by GCC states, according to a top government official.
The move is cost-effective as food prices are skyrocketing in world markets, said Industry and Commerce Minister Dr Hassan Fakhro.
He was speaking at a meeting held yesterday with leading Bahraini food traders to discuss securing basic imported staples at affordable prices.
The national price control committee, under the ministry, first drew up the proposal, which was later submitted to the GCC trade committee for further review.
'We are calling on financial companies and banks to come forward and invest in food and agro-business industries,' he revealed.
Such investment ventures could also include launching local projects aimed at ensuring basic food security, he said.
Traders were also urged to explore new markets and provide alternatives for each single staple so Bahrainis could have a wider choice regarding price and quality.
The traders said local markets suffered no shortage in basic staples.
The sharp increase in the prices of rice, dairy products and other food items was a global trend, which spared no country, they said.
They also blamed consumers for the current price rise as they tend to favour particular trademarks, urging them to wisely compare goods.
The global price of rice has more than doubled in the last year, according to the UN Food and Agriculture Organisation (FAO).
It expects the situation to get worse as major producers such as India and Thailand curb export levels to meet demand at home.
The FAO predicts a 3.5 per cent drop in global exports and further price increases despite the 42 per cent rise in the first quarter of this year - the highest increase in 14 years.
Al Jazira Group general manager SK Surendran said prices had risen due to the increasing cost of raw materials.
'In some cases, prices are up by as much as 70 per cent. The price of dairy products has been hit particularly hard,' he said.
'Rice imports are also down, which is causing the price increase. And the combination of strong rupee and Euro and a weak dollar is all having an affect.
'However, we are not passing all of this on to the consumer. Our margins are marginally narrower than before.'
Central Municipal Council member Abbas Hussain Mahfoodh Mohammed said it was working hard to help the most vulnerable. 'We receive almost daily complaints about the price of food,' he said.
'We are trying to work with the ministry to get a list of food prices and post them to all food stores in our district. Then we will set up a hot line and people can report any shops selling goods above the listed price.'
In 2006, the government spent BD12 million ($31.2 million) to subsidise flour meat and poultry and last year that figure rose to BD17 million.
The ministry said last month that the amount would increase to BD30 million this year.-TradeArabia News Service