Qatar ministry scraps monopoly on import of 35 food items

The cost of nearly three dozen food and household goods is expected to drop in Qatar after the government ended a monopoly on who gets to import the items.

The Ministry of Economy and Commerce (MEC) said yesterday that more agents will now be able to bring in the 35 items, as part of a wider attempt to cut household costs, improve availability and open up the market to new suppliers.

The list includes all dairy and meat products, baby formula, all brands of tea and coffee, rice and pasta, frozen food and treats such as biscuits, chocolate and ice cream, the ministry said in a statement.

The right to exclusively import these items to Qatar was previously held by 420 agencies, but this has now ended and the General Authority of Customs has been advised of the changes.

The move comes as the cost of living in Qatar continues to rise, with August’s inflation rate nudging up to 2.9 percent, according to official figures.

Improve competition

The move is part of a wider effort to break monopolies in the market, get rid of “unjustified price increases” and create a more competitive business environment in Qatar.

It follows the Emir’s ratification of Cabinet decision No. 24 of 2016 in June this year, which exempts a number of goods from legislation governing commercial agents (Law No. 8 of 2002).

The items that are now free for open import are:

Powdered, condensed and evaporated milk; all dairy products; baby food and infant formula; poultry, meat and eggs; rice; flour; fish and seafood; tea and coffee of all kinds; sugar; honey; juices, soft drinks, mineral and bottled water; salt; pasta of all kinds; biscuits; chocolate; sweets; ice cream; all nuts; potato chips; frozen and canned food; grain and corn chips; beans; cooking oils; margarine; yeast; toothpaste; diapers; sanitary napkins; all washing powers; tissues; aluminum foil and all domestic detergents.

According to the MEC, “the presence of a large concentration of these goods (is) in the hands of a small number of commercial agents.”

In some cases, suppliers were not importing competitive products into the market, thus driving up prices and reducing supply and choice for consumers.

The ministry added:

“The new measures will also contribute to supporting the business climate in the state, through incentives to many suppliers and new traders, especially allowing young entrepreneurs to enter the market, which was (previously) closed due to commercial agencies.”

Inflation up

The new rules were announced as household spending in Qatar has started to creep up again, with inflation for August recorded at 2.9 percent.

Compared to July this year, food and beverage costs were up 1.1 percent, while transport increased 0.8 percent and clothing and footwear by 0.4 percent, the latest figures from the Ministry of Development, Planning and Statistics (MDPS) showed.

For illustrative purposes only — Photo for illustrative purposes only

However, the year-on-year figures showed a decline of nearly 2 percent in prices for food and drink.

Spending in restaurants and hotels was also down by 3.2 percent compared to August 2015, while health costs showed a 1 percent year-on-year drop.

The cost of living in Qatar has been steadily climbing over the summer, from June’s inflation rate of 2.5 percent to July’s of 2.8 percent.

However, it is still short of this year’s high of 3.4 percent in April.

In total, household spending rose in eight areas year-on-year.

In line with the trend over the last few months, rises in education costs (7.1 percent year-on-year) and going out (7 percent) were the main drivers in last month’s spending increases.

Other hikes included: