How governments are trying to ease inflation pain

A customer shops organic products at the Bio foods in a Lidl supermarket in Gattieres near Nice, France, Dec 2, 2022. REUTERS/Eric Gaillard/File photo

Pandemic-related disruptions to global supply chains and the knock-on effects of Russia’s war in Ukraine have driven up prices of energy, commodities and necessities.

Here’s how governments are trying to help hard-hit consumers and companies:

Americas:

* The U.S. government in early November announced $4.5 billion in measures to help Americans lower home energy bills. The administration also put forward the $430-billion Inflation Reduction Act in August.

* Mexico will raise the minimum wage by 20 percent next year after an agreement was reached between employers, labour representatives and the government.

* The transitional government of Brazil’s president-elect hopes to exempt the “Bolsa Familia” welfare program and some public investments from a constitutional spending cap. The country’s oil giant Petrobras has cut fuel prices multiple times this year.

* Argentina agreed with major oil firms operating in the country to cap fuel price increases. The government has also signed a deal with supermarkets and suppliers of mass consumer goods to freeze or tightly regulate prices of some 1,500 products, and raised the income tax threshold.

* Canada in November laid out billions in spending to support low earners and offer students debt relief. In September, the government announced a C$4.5 billion ($3.32 billion) package.

Europe:

* European Union countries are racing to reach a deal on a gas price cap by Dec. 13. The bloc’s members are considering a slightly lower gas price cap than the one proposed by the European Commission, documents seen by Reuters showed.

* Germany’s Cabinet in November approved a planned cap on gas and electricity prices in an expedited process. The government has set out a 200 billion-euro ($210.08 billion) “defensive shield” and agreed to nationalise gas importers Uniper and Sefe.

* Slovakia will spend 6 billion euros to cap energy prices for households next year.

* Hungary’s government said a potential extension of a price cap on fuels next year will depend on information whether oil and gas group MOL can ensure supply.

* Spain’s banks and the country’s two biggest unions agreed to raise wages of employees in the sector by 4.5 percent in 2023 compared with 2022. The government and banks also agreed in principle on mortgage relief measures for more than 1 million vulnerable households.

* Italy’s government will spend some 21 billion euros next year to help firms and households with energy costs.

* Britain unveiled a scaled-back version of an existing cap on energy bills and announced it would raise pensions and welfare benefits in line with inflation.

* France is fully nationalizing nuclear energy group EDF. The government will cap household power and gas price increases at 15 percent next year and is helping struggling small and mid-sized companies.

* Belarus banned consumer price rises from Oct. 6.

* Poland will cap electricity prices for small businesses, hospitals and households in 2023, and raise the minimum wage twice.

* Portugal’s regulator will limit electricity price rises to 2.8 percent next year for hundreds of thousands of households and small businesses.

* Croatia has capped electricity prices until March.

Asia:

* Japan will spend $200 billion on a package including electricity and gasoline bill subsidies. It had already announced a record minimum wage hike and a $103 billion relief bill.

* Indonesia has extended loan forbearance for some businesses that are yet to recover from the COVID-19 pandemic. The government in September ordered regional heads to keep food inflation below 5%.

* The Philippines‘ president has ordered agencies to continue supporting the most vulnerable sectors through cash aid and fuel discounts.

* Thailand on Nov. 15 agreed to extend an excise tax cut on diesel until Jan. 20.

* India is weighing up the release of wheat state reserves into the open market to cool prices while axing the 40 percent tax on imports, government sources said. In September it restricted exports of rice to boost supply and calm local prices.

Africa and Middle East:

* Turkey in July raised the minimum wage by about 30 percent, adding to the 50 percent rise seen at the end of last year.

* Tunisia’s government in September signed a deal with a major labour union to raise public sector pay and the minimum wage.

* Botswana in July cut VAT by 2 percent for six months.

* Saudi Arabia and the United Arab Emirates in July raised social welfare spending.