Romanians will pay less for some staples
Romania is about to lower prices in some staple foods
Corina Cristea, 23.06.2023, 14:00
The new PSD-PNL government in Bucharest has started to put in place a series of measures aimed at keeping inflation at bay, and reducing its effect on the population as well as trade imbalances. Among the measures announced are those meant to lower the shelf price in some staple foods and bolster the domestic output.
In order to achieve these goals the Executive intends to put a cap on the trade markup, which means, at least in theory, that suppliers would give up part of the profit they make. Major retailers have agreed in their talks with the government to apply a price cap in 10 staple categories. Weve got their response to our intention to put a cap on the trade markup, which is not going to put pressure on the local producers though, Prime Minister Marcel Ciolacu said.
Marcel Ciolacu: “We thus have all the necessary conditions to conclude an agreement or a normative act in the next period. And that would mean a guaranteed reduction in the price of some staples such as bread, milk, cheese, meat, eggs, flour, oil, fresh vegetables and fruits. And I would like to make it very clear that this price drop would not put pressure on the Romanian producers.”
The Council of Competition is to monitor the prices situation and in the following period, the government will be carrying on talks with food producers and suppliers on the aforementioned cap scheme. Possible drawbacks or technical challenges are being analyzed, George Badescu, executive director of the Romanian Association of Big Retailers, told Radio Romania. According to him, we are speaking about a free market, competition, multiple aspects, so that this measure is not supposed to cause imbalances or turmoil on this market. It must yield the desired result, even if it is taking place on a limited period of time.
“I am glad about this openness of the business environment, which, following our dialogue, has agreed upon a viable, simple and clear mechanism, which together with government measures can lead to a curbed inflation and increase the Romanians purchasing power. The firm commitment assumed is to bringing inflation down to single digits by the end of the year. I believe we can achieve this goal together with the business environment,” Marcel Ciolacu says.
A similar scheme has already been applied in France, where a major retailer, which has branches in Romania as well, a couple of days ago announced a roughly 10% price cap in 500 staples and other non-food products. Other major French retailers are expected to follow suit.
(bill)
