High prices and the state
Rising fast food prices in the UAE are viewed with concern by the state. Yet they are the result of higher costs to the retailers (mostly due to rising costs of imports transmitted through the fixed exchange rate with the dollar).
Meanwhile we wonder whether a reduction in the state's royalty burden on telecom profits (currently 50%) would be coupled with a change in state regulation that would allow price competition between etisalat and du. Price competition would reduce the burden of high prices on the people.
Shouldn't the mission of the Telecom Regulatory Authority be to promote competition rather than to protect competitors?
We also wonder why the telecoms don't capitalize their names.
Meanwhile we wonder whether a reduction in the state's royalty burden on telecom profits (currently 50%) would be coupled with a change in state regulation that would allow price competition between etisalat and du. Price competition would reduce the burden of high prices on the people.
Shouldn't the mission of the Telecom Regulatory Authority be to promote competition rather than to protect competitors?
We also wonder why the telecoms don't capitalize their names.
Labels: inflation, Price controls, regulation, TRA
posted by John B. Chilton at 5/18/2007 12:49:00 PM
2 Comments:
Because some ad agency thought it was 'hip' to go with 'du' being lower-case. Then etisalat wanted to make sure that du don't have a 'differentiator', and proceeded to copy the style -- in other words, their efforts to differentiate themselves from etisalat are continuously and systematically undermined by etisalat in that manner. Really, smart move.
Either way, it's silly.
The State's concern over prices are indeed a result of pegging the dirham to the dollar. However, I'm not so sure it would be a good thing to remove that now. If/when this bubble busts, I would think the dollar would come to the rescue.
Have you seen this story about attempst to prevent social unrest in the Middle east:
http://www.gulf-times.com/site/topics/article.asp?cu_no=2&item_no=150102&version=1&template_id=48&parent_id=28
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