MUSCAT, June 25 Oman's ruler Sultan Qaboos bin
Said has put on hold the government's decision to scrap price
controls for most products after a public uproar triggered an
intervention by his consultative council, state news agency ONA
Under new rules announced last week, retailers and traders
no longer needed to ask the government for permission to raise
prices, except for 23 basic items such as rice, tea and fish
which remained controlled.
But after debating the new rules on Tuesday, the advisory
Shura Council drafted a letter to the sultan, recommending that
he postpone their adoption until other laws protecting consumers
and preventing monopolies could be enacted.
"The Council agrees completely with the principles of
free-market economy and that the state shouldn't intervene in
the market, leaving it to the power of supply and demand," ONA
quoted the letter as saying.
"And for this to happen, it is important to maintain a
balance between traders' rights and consumers' rights," added
the council, whose elected members received a public motion
signed electronically by about 2,000 petitioners.
Sultan Qaboos, who has been ruling Oman since 1970,
responded by suspending the rules based on his understanding of
the needs of the public, ONA reported.
The new rules had caused an unusual public furore in the
absolute monarchy, with hash tags objecting to the reform
drawing tens of thousands of tweets, even though economists
predicted only a minor impact on inflation.
Oman, a small oil exporter, faced sporadic street protests
in 2011 that demanded jobs and an end to corruption. It
responded by boosting welfare spending and creating tens of
thousands of public sector jobs that burden the state budget.
Sultan Qaboos' decision to suspend the price deregulation
illustrated how difficult it can be to introduce economic
reforms in the Gulf monarchies, since rulers are wary of public
discontent even if they have ample power to act.
Last December, Bahrain announced it would raise fuel prices
to save on state subsidies, but backed off from implementing
that plan after members of parliament protested.
Oman's cabinet has yet to reveal when it plans to discuss
consumer protection and anti-monopoly legislation.
(Reporting by Fatma Al-Araimi; Writing by Martin Dokoupil;
Editing by Andrew Torchia)