Specialisation: UAE

Measures to Inflation in the UAE From a Social Perspective

Inflation brings both economic and social problems to a country. All its effects mostly hit the low class, the largest group in most countries. Dealing with the social impacts of Inflation decisively needs the government to roll out social programs that will enable the communities to continue having better lives and support their own lives, Borrowing examples from countries that have best rolled out the social program to help tackle Inflation from a social perspective, UAE should consider putting its focus on subsidization of food costs, help the unemployed and also work on ensuring that low social class people have access to education. The paper will suggest which UAE has to intensify to tackle Inflation from a social perspective.

Subsidization is one way of ensuring that low-class people get basic needs during economic hardship. Better-performing governments have ensured they roll out social support programs to cushion the low class against skyrocketing food prices, electricity, water, and other essential commodities. The UK and EU, for example, continue to cap the cost of living by energy. In the last few months, they have invested $500 billion in energy subsidies, which target the low class to ensure that they have access to better prices for food, water, and electricity; this means a household will not pay more than $ 2880 for energy-related products(CNN,2022). Just The government in UAE is subsidizing food and energy prices to ensure that low-class people eat socially cushioned against the harsh economic times. The government has made several interventions to ensure that each household has access to fair prices for all products that are related to energy. The fuel subsidy program by the UAE government is provided every month, a subsidy equivalent to 85 percent; this is done at every fuel station and given to the head of the family (Ould,2020). Three hundred liters are issued. Food prices have continually hiked because they are directly linked to energy prices. UAE has put in a program where the government incurs 75 percent of food prices, and the beneficiaries registered to receive fuel subsidies are automatic beneficiaries of reduced food prices, too(Hassan,2023). The foods are available in specific hypermarkets.

Protection of the poor and the vulnerable is another way of keeping Inflation at bay. The soaring Inflation hits most households, which is likely to cause poverty because the purchasing power goes low as food prices increase; food constitutes more than 30 percent of the homes in the UAE. While several countries have attempted to evaluate the spending acts, there should be a subsidy which should be a reform to protect the poor and the vulnerable groups in the community. The government has effectively rolled out inflation allowance to almost 47 000 Emirate families to help them cater for food, electricity, water, and fuel (Al-Nassar, 2021). This is a social support program from the government for vulnerable groups. The program received a boost twice as earlier as the government pumped in DH 28 Million (Cherian, 2020). This program featured education, the elderly, and food, fuel, and electricity subsidies. Like in best-performing countries like the United States, Britain, and Canada, subsidies to poor families and the vulnerable should be efficient so that their social lives are bearable and not left to sink into poor social status.

Unemployment is a social problem; during Inflation, many people become unemployed, or their jobs are at risk; there are several approaches to ensure the jobless and those who risk losing their jobs are cushioned against hard times. While UAE is keen to provide cash transfers to the unemployed and subsidize food and energy prices, there is a need to ensure those in the low-income bracket and those who lose jobs due to shut down of industries where they used to work get compensation. Through the social support system like in Canada, the government ensures that those who lose their jobs in such times are given stipends that will enable them to survive. At the same time, the long-lasting solution to unemployment is being addressed. There are best examples of countries that have cushioned the unemployed and those who are rendered jobless as a result of Inflation. Low-income earners in Canada received a tax deduction in a program known as Canada Workers Benefit. This cost the government up to $1.7 billion. The affected by the close of businesses were equally compensated as the government rolled out plans to ensure they get absorbed into various forms of employment; this will reduce the poverty levels be y ensuring they have an earning to support their family’s various

Shelter costs remain elevated during the economic slump; the low class finds it hard to pay their rent dues because of the loss of jobs and other pressing economic issues. The latest report shows that apartment rents jumped by at least 23 percent in America, the same in Canada. To help the low class from this challenging situation, there is a need to have a support program to collect data and ensure that the vulnerable groups get shelter and are not harassed by landlords during such challenging times. A long-lasting solution to this effect is affordable housing units, enabling poor people to access affordable housing during tough economic times. However, a short-term solution should help the hundreds of people across the UAE who face the risk of moving to poor housing or being evicted from houses they cannot pay. Canada, in 2022 rolled out a social support program where low-income earners were granted $ 500 to almost one million Canadians at risk of the cost of housing (Jacob et al., 2022). This plan was targeted to help alleviate the social status and house those who could not due to social problems brought t in by Inflation. The same case can be applied in UAE to reduce the social impact of Inflation.

Education is one of the social aspects of society; it is very apparent that Inflation affected education either directly y or indirectly. Many countries have taken the initiative, making it possible for education instituting to continue operating and offer every learner a chance to get an education despite the rise of its costs. In Canada and the USA, such interventions have been made to ensure children from poor backgrounds d not struggle to access education at this time. Canada identified 13 provinces that will benefit from this social program focused on cutting the costs of early learning and childcare fees housing (Jacob et al., 2022). The program was intended to save low-income families from the high costs of keeping a learner in school by cutting it by at least 50 percent. Education is an essential aspect of the UAE; during this period of Inflation, it may be challenging for such families to take their children to school and meet all the financial obligations, taking examples from other countries of direct investment and subsidization of education costs.

It is apparent that Inflation has a social impact on any country; the success of a nation will therefore be gauged by how it addresses the problems that come with it socially because the social well-being of a country contributes to the better economic aspect of any nation. While UAE has rolled out various approaches such as subsidization, there is a need for it to benchmark from those countries that have done their best to socially protect its people, such as the EU, UK, Canada, and even America.


Al-Nassar, N. S. (2021). Can gold hedge against Inflation in the UAE? A nonlinear ARDL analysis in the presence of structural breaks. PSU Research Review, (ahead-of-print).

Cherian, A. (2020). The construction industry in the perspective of an economic boost in the United Arab Emirates (UAE). Int. Res. J. Eng. Technolpp. 9001, 270–276.

Hassan, A. A. (2023). FOREIGN DIRECT INVESTMENT (FDI) ROLE IN THE ECONOMIC GROWTH IN THE UNITED ARAB EMIRATES. International Journal of Economics and Finance Studies15(1), 17–31.

Ould Daoud Ellili, N. (2020). Environmental, social, and governance disclosure, ownership structure and cost of capital: Evidence from the UAE. Sustainability12(18), 7706.

Jacob, V., Chattopadhyay, S. K., Attipoe-Dorcoo, S., Peng, Y., Hahn, R. A., Finnie, R., … & Remington, P. L. (2022). Permanent supportive housing with housing first: findings from a community guide systematic economic review. American journal of preventive medicine62(3), e188-e201.

Laureen Kent, Ann. C (2022) CNN Business: UK, EU throw $ 500 Billion at energy subsidies https://edition.cnn.com/markets?utm_source=business_ribbon

Sebugwaawo. I (2022) Khaleejtimes ‘Inflation in UAE: Government disburses allowances to 47,300 low-income Emirati families’ https://www.khaleejtimes.com/uae/inflation-in-uae-government-disburses-allowances-to-47300-low-income-emirati-families