Data-starved Dubai to get new inflation index :: Reuters
The statisticians at the Dubai Chamber of Commerce told Reuters the business community had been pressing for a better measure of inflation in Dubai, the region's booming commercial hub where prices are skyrocketing.
The new index will reflect the different spending patterns of the various communities of Dubai, where most of the UAE's huge expatriate population lives, said Marietta Morada, who heads the project at the chamber, a quasi-government body.
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Few analysts pay much attention to inflation measures in the UAE, a federation of seven emirates. They say the basket of goods used does not reflect the realities of life in the Gulf state, where over 80 percent of the population are foreigners.
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Official figures show UAE consumer price inflation was 4.7 percent in 2004. But some analysts say that in Dubai the rising cost of rent, healthcare and schooling pushed it closer to 8 percent.
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Morada said the index would be based on the Dubai household expenditure survey of 1998. "Unfortunately that is the latest and best starting point we have," she said.
The UAE has long counted on low taxes and an affordable standard of living to lure foreign firms and expatriates, who are driving its transformation from oil economy to financial centre. But the cost of everything from rents to school fees is surging. On top of that the UAE raised petrol prices by up to 32 percent from this month.