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Trade : Competition Council: Food prices in Romania, 60% of EU price on average, situation relatively good
Romania is not in a bad situation in terms of food prices, but a generalized rise in these can be countered by macroeconomic means, namely the fiscal-budgetary policy of the Government and the monetary policy of the National Bank, the president of the Competition Council, Bogdan Chiritoiu told Tuesday's PRIA Competition, an event organized by PRIAevents and the Competition Council.
"We [the Competition Council] are not investigating general price increases, but only point-by-point increases. If we are talking about a general price increase, this is called inflation, a macroeconomic phenomenon. As the Prime Minister has said recently, inflation is combated through two big and wide means: the fiscal-budgetary policy of the Government and the monetary policy of the National Bank. In any country in this world, in a market economy, generalized price increases are related to macroeconomic policy and can be combated by macroeconomic means (...) Our expectation is that the price monitor will put pressure on companies to reduce the price of food. It is just our expectation. For a big company it is easy to find out the competitors' prices. It is much more difficult for consumers though. Romania is not in a bad place in terms of food prices. European statistics show us that the price of food in Romania is on average 60% of the price in the European Union. So, what costs on average 100 lei in Europe, in Romania costs 60 lei. This is a relatively good situation," Chiritoiu explained.
The head of the competition authority also stated that the 4% increase in food prices recorded in 2017 does not represent a very high increase.
"We find it big because we are no longer used to it. Until we joined the European Union, the inflation in Romania had two digits. We were used to a 10% rise in price food every year. For several years we have managed to be among healthier countries and to have a very low inflation.
"Prices have gone up, but for years we have had zero or even decreases in food prices. The difference was so small that at some point we worried not to be too small, so that we should have deflation instead of inflation. Last year, we overcame the fear that we would have deflation, and we have come to an inflation that, according to the National Bank, is in the area of expectations," Bogdan Chiritoiu said.
Representatives of the business environment in Romania, along with officials of state institutions, are attending on Tuesday the PRIA Competition, an event organized by PRIAevents and the Competition Council.