For a month, goods and services have become more expensive by 0.9 percent, and for a year - by 4.1 percent. The annual inflation since the beginning of this year - in January it was 3.5 percent, in February 3.3 percent, to reach 4.1% in March.
In just one month, the price of the small consumer basket, which also includes basic services, has increased by 2%, shows an analysis by the CTU. 21 goods in the small basket cost just over 61 euros. For a month, they have become more expensive by 1.3 euros or 2 percent. The record holder for price increases is tomatoes - their price has increased by over 29% in a month. Potatoes, lemons and apples are also among the fruits and vegetables that have increased. Among other basic foods, there has been a greater increase in chicken, eggs and oil - you can see the increase is 1%, while the increase in price for bread is 0.7%.
Inflation in Bulgaria in recent years has remained a serious challenge for households, with the feeling of price increases often being stronger than the official data. This was commented on bTV by economist from the Confederation of Bulgarian Trade Unions and Employers, Lyuboslav Kostov, who gave a detailed analysis of prices, incomes and market processes in the country.
According to him, the official data do not fully reflect the real price increase: “Let's say, at the beginning it was around 40 and a few, 2-3% is the total inflation for the last 5 years. It is a general consumer price index, which includes over 1,000 goods and services.“
He explained that different categories of goods are increasing in price at different rates: “Imagine from these 1,000 goods and services how, for example, household appliances are almost not increasing in price, the foods that we most often consume are increasing in price more.“ And he gave a clear example: “When I say average inflation of 4%, keep in mind that bread, cheese and eggs are increasing in price by two to three times, and there are some other goods that are almost not increasing in price, some are getting cheaper.“
Therefore, according to him, the most important thing is not the average level, but the structure of consumption: “It is very important what our consumption is oriented towards, not so much the average inflation.“ And he concludes: “Unfortunately, Bulgarians' consumption is oriented towards goods that are much more expensive and this is felt.“
Kostov emphasizes that in Bulgaria there is no clear legal definition of “speculation“: “In Bulgaria there is no official definition of what speculation is in any law.“ Nevertheless, he is categorical: “There is speculation from an economic point of view, but we do not have a standard that says: this is speculation.“
He gives an example with dairy products: “We have a Commission for the Protection of Competition, which says that there is a cartel in milk and dairy products.“ And he adds specific data: “40 euro cents is the cost price of a liter of milk, 1.88 euros at the counter, 1.18 euros wholesale. 60% difference from the stock exchange to the counter.“
“There is an unjustified increase in prices, there are huge markups between wholesale and retail. We are filling the basket much more difficult“, said Kostov.
Although incomes are not decreasing, people's feelings are different: “Right now we all see that prices are rising and somehow we are filling the basket much more difficult than last year, although incomes are supposedly not reduced.“
Kostov is categorical that profit ceilings should not be introduced: “Profit ceilings are not market-based. We are against putting profit ceilings in place.“ But he offers another solution: “Regulators can try to shed light on the entire chain.“ And he explains: “If we know how each commodity is priced – from the moment of its production, through the resellers, to the counter – then we can already say which of this price increase is market and which is not.“
He gives examples of serious markups: “The differences are huge – from 30% to 100%.“
About cheese: “If someone could explain to me what happened in the market to make cheese go from 6 euros to 10 euros, when it comes from the stock exchange and enters the store – what is this market?“
“In my opinion, there is no market explanation, but there is no way to prove that it is not market, since the pricing chain has not been clarified”, said Kostov.
He emphasizes a serious imbalance: “We have brought prices to 125% in food, especially in dairy, from the average European values. At the same time, our incomes are at 67%.“
“There is a difference of at least 20 percentage points, which, if we do not compensate, this feeling that we can buy less and less will increase.“ Even without a drop in income: “The Bulgarian is losing real purchasing power. Even though his income has not decreased.“
And he gives an example: “Today we can buy less than last year.“
According to him, the problem is also in the structure of the market: “When there are 3-4 large players who hold 75% of the market and will sell at these prices, all other small ones comply with them.“
Kostov points to a serious decline in agriculture: “Dairy cows are decreasing by 60.6%... there were 17,000 farms, currently there are 6,000.“ And the conclusion: “When local production decreases with maintained demand and is replaced by imports, prices become higher.“
He emphasizes a key dependence: “Two-thirds of the growth in the economy is driven by household consumption.“ And he adds: “People have no choice and there is no way to stop buying.“ In the absence of measures, the forecast is alarming: “If this continues, as you say, by the end of the year expect double – to 15% growth in the total basket.“
Kostov also made direct criticism: “The state is a silent accomplice in this freedom of the market economy.“ And he called for concrete actions: “They should not play around in elections and throw political slogans at each other, but say something concrete about what they will do with demography, prices, and incomes.“