High utility bills are reported to be weighing down on residents, expats, and businesses as many claims they are unable to cope with the rising costs. Speaking to Gulf Insider, MP Ahmed Al Ansari said that “It is worthless to live in a place where your entire salary is going towards expenses. As a Bahraini, even I struggle to pay my bills. The rise has affected both Bahrainis and expats alike,” According to a Gulf Daily News front-page headline last month, the Electricity and Water Authority (EWA) received a record 195,000 calls in the past four months, sparked due to increased utility bills.
Utility bills are the highest during the summer due to the increased use of air conditioners and water, making it a struggle for many Bahrainis and expats alike. EWA recently announced readjusted bills for the summer, exclusive to Bahraini citizens, for June, July, and August. According to the readjusted bill, Bahrainis will be charged according to last year’s issued amount, given that the amount is lower compared to bills issued in 2019 for the same period. Following the announcement, many expats who had been hoping for similar relief expressed dismay on social media platforms for being excluded.
Recent statistics by the General Organisation for Social Insurance (GOSI) revealed that 73% of the expat population earns less than 200 Bahraini Dinars per month, while the average salary of Bahraini workers in the public and private sectors is 532 Bahraini Dinars per month. “Expenses are soaring while there is no increase in salaries and this is making the situation worse. We feel sorry for the expats, many of them are sending their families back home and moving into shared accommodation because they are struggling to meet rising expenses” said Mr. Ansari. Bahraini citizens qualify for a subsidized rate of 3 fils per unit, but if they exceed 3,000 units in a month the rate increases to 9 fils and then 16 fils if it goes over 5,000 units.
On the other hand, expatriates are charged 29 fils for all units, a massive 866% more than Bahraini citizens. Before the phased increase which began in 2016, both expats and Bahrainis alike paid 3 fils per unit. “There is a ripple effect due to this, a Bahraini businessman who owns multiple properties in the country told me that he currently has 72 flats vacant for the first time which is causing a lot of difficulties for him. Many of his tenants have left because of rising expenses,” said Mr. Ansari. Bahraini resident Mrs. Layla Ebrahim from Gudaibiya told Gulf Insider “My children grew up playing and bonding with the expat children in the neighborhood, an experience my grandchildren may not have as the rising expenses have driven many expat families out of the area.
This is our home and we are thinking about moving because of the rising costs” Another long term expat told Gulf Insider that years ago he had invested in a five-bedroom property in Riffa Views and that the current electricity charges now made living in the house unaffordable for him and his family. He said he feels trapped because the depressed real estate market means he’s unable to sell and move elsewhere. The kingdom’s private sector is also struggling as utility costs for businesses have almost doubled. In 2016, the tariff for businesses was 16 fils for the first 5,000 units, 22 fils for 5001 – 250,000 units, 23 fils for 250,001 -500,000 units and 29 fils for 500,000 units and above. Now businesses are charged 16fils for the first 5,000 units and 29 fils per unit if they exceed 5,000 units.
“Across the country, we can see an increase in ‘For Rent’ signs as many commercial and residential properties remain vacant. It is unreasonable to pay utility costs that almost amount to the rent. I live in Riffa, which is home to many popular commercial streets and more than 45 shops have closed because of utility bills and other expenses,” said Mr.Ansari. “We approached EWA, who told us that they will provide a solution to this issue but nothing has happened yet. The MPs in Bahrain are trying their best to fix this and hopefully there will be a change soon,” he added. Khalid Mohamed Yusuf Najibi, First Vice Chairman of the Bahrain Chamber of Commerce (BCCI), told that they have received complaints regarding high utility costs which prompted them to conduct a study regarding challenges faced by small and medium enterprises (SME), which make up 95% of businesses in the Kingdom.
Mr. Najibi said; “The study revealed the biggest challenges faced by SMEs are not limited to the utility price increase but also include rising governmental fees, difficulty of accessing consultancy and financing, and challenges in labor hiring,” Mr Najibi added that the BCCI continues to address the issue and their recommendations have been accepted and are in different phases of implementation. One recommendation that was implemented earlier this year involved the allocation of BD21 million to enable ministries to pay money owed to companies– and small and medium enterprises. Ministries were instructed to fast-track the payment of pending invoices and pending financial obligations to companies, especially small and medium ones. Instances of food poisoning have been caused due to some cold store owners have started to switch off their refrigerators during closing hours in a bid to reduce their monthly utility bills, resulting in the rotting of some products, especially dairy products, which are sold to consumers.
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