Administrative pressure and sanctions will not lead to a decrease in prices in retail chains. This was stated by the Executive Director of the Association for Modern Trade Nikolay Valkanov on the air of “Your Day“ on NOVA NEWS.
“I do not know of anyone in the whole world who has managed to lower prices with sanctions or state and administrative pressure. No country can boast of such success“, said Valkanov.
According to him, there are no economic grounds to expect a drop in prices with increasing costs for energy, natural gas, salaries and insurance. He also pointed out the weak agricultural production and Bulgaria's dependence on imports of certain foods.
Vulkanov gave an example of the different prices of the same product in different stores.
„If a trader in the market decided today to sell his butter for 4 euros, that is his decision. It does not mean that the consumer cannot buy butter for 2 euros in the neighboring store. This is called competition, free market and consumer choice“, he said.The dispute over food prices
Vulkanov also commented on the comparison between the prices of food products in Bulgaria and Luxembourg, made by Plamen Abrovski. According to him, the indicated price of fresh milk does not reflect the average price of the product in Luxembourg.
He also drew attention to the differences in production. According to him, Luxembourg produces significantly more milk compared to its own needs, although it has fewer animals than Bulgaria. Valkanov linked this to the higher productivity and efficiency of farms.
Markups of up to 15%
Regarding trade markups, Valkanov said that individual examples of a large difference between the purchase and sale price do not give a complete picture of the market.
When asked whether limiting markups to 15% could lead to lower prices, he replied: “I don't see how this can happen, since prices are not artificially inflated in the retail chains themselves“.
According to Valkanov, individual examples of a higher difference between the purchase and sale price do not change the overall picture. He said that Bulgarian retail trade operates according to the same rules as the sector in Europe.