UAE businesses hike prices as surging inflation bites

UAE businesses hike prices as surging inflation bites

Most businesses in the UAE have opted to pass the cost of surging inflation to consumers in a bid to protect their margins, but they have not taken any steps to deal with inflation over the long term, according to a new survey.

The survey conducted by advisory firm Grant Thornton, found that companies in the UAE are feeling the pressure of increasing costs. Nearly nine out of ten (87%) of businesses polled have increased their prices, "at the same level or above cost increases".

Owners of mid-market businesses said they have seen increases of 18% in their energy and utility bills, 17% in raw materials costs and 14% in salaries or staff compensation. Businesses also saw a 16% increase in outgoings related to equipment, as well as bank, interest and taxes.

Grant Thorton's survey covered 5,000 mid-market businesses across 28 countries, including the UAE. Respondents were asked about price increases and steps being taken to mitigate the risks associated with rising costs.

Inflation has risen to historic levels in many markets worldwide, leaving both consumers and businesses to scramble for ways to protect their finances and margins. In the UAE, the International Monetary Fund (IMF) had forecast that inflation will be at 3.7%