Yesterday, the government limited trade margins for 43 products, for wholesalers and retailers, to 5 to 15 percent each, which should lead to lower prices.
The earlier proposal of this decision, from February, which "Vijesti" had access to, provided for the limitation of margins for entire groups of products, and now specific products with specific packaging are specified. For example, in the previous proposal, the margin limit was provided for all chicken meat, and now it is only for the whole chicken, i.e. previously it was for all milk, and now only for milk in a one-liter package with 2,8 percent milk fat and without cap,... The proposal was to lower the margins for all frozen vegetables, and now the limit will apply only to frozen peas,...In the earlier proposal, lower margins were planned for chocolate, euro cream, olive oil, non-carbonated and carbonated water, eggs, until now they are gone...
The decision lists tables with 43 products, and the Prime Minister Milojko Spajic said at the press conference yesterday that this covers over 500 items, when different weights and manufacturers are taken into account.
In February, the Ministry of Economic Development (MER) prepared changes to the decision on limiting margins, but the economy announced that it was not consulted. This was followed by meetings with MER, which led to the correction of the original proposal.
The restriction was introduced by amending the Decision on temporary measures to limit the prices of products of special importance for people's life and health from June 2022, according to which the "Stop Inflation" actions were implemented earlier. As in previous actions, there is no special authority assigned to any inspection to control whether traders really reduce margins, so that practically everything is on a voluntary basis by traders with whom the final list was agreed upon in relation to the previously proposed one.
The amended decision states that it enters into force on the day of its publication in the Official Gazette. Minister of Economic Development Nick Djelosaj he expects the decision to be implemented from the end of March, and it will be valid until the end of May, i.e. two months.
In the explanation of the decision, it is not stated how many price reductions are expected from these restrictions.
The decision extended the previous validity of margin limits in large stores to up to five percent and in retail stores to seven percent for wheat flour type 400, wheat flour type 500, crystal sugar, edible sunflower oil (regardless of the type of packaging) and table salt in packaging of one kilogram.
In wholesale and retail trade, the maximum margin amount of 10 percent is for: domestic white cheese (in bulk), domestically produced yogurt in a one-liter package, fresh potatoes (no weight limit), milk in a one-liter package with 2,8 , 800 percent milk fat and without caps, whole chicken and pork neck without bones (no weight limit), long grain white rice in a bag in packages of 350 grams to one kilogram, white flour pasta in packages of 400 to 500 grams, frozen peas in packages of up to 250 grams and table margarine of XNUMX grams.
This group also includes meat products only domestically produced in bulk or without weight restrictions - tea sausage, compressed ham, chicken breast, sudžuk, beef tea sausage, chicken hot dogs and dry pork bacon. The same rules on the reduction of margins will apply to a 200-gram can of tuna pieces without additives in oil, a 100-gram chicken pate without additives, plum jam and marmalade in packages of 500 grams to one kilogram, beef stew in a can of up to 500 grams, mild ketchup in packages of 300 to 500 grams, fresh trout without weight limit, sardines in vegetable oil without additives in packages of up to 200 grams, juice syrup for dilution of one liter, semi-hard block cheese (edamer, gouda) in bulk.
For the group of products for maintaining hygiene, margins in wholesale stores are limited to 10 percent, and for retailers to 15 percent. This group includes solid baby soap in a package of up to 100 grams, "economy" baby diapers in a package of 40 plus pieces, baby shampoo in a package of 200 to 500 milliliters, fruit porridge for babies in a jar of up to 130 grams, baby bath in a pack of 200 to 500 milliliters, shampoo for adults of one liter, bath for adults of 250 milliliters, toothpaste of 125 milliliters, three-ply toilet paper in a pack of 10 pieces, washing powder detergent in a pack of three kilograms and sanitary napkins standard of ten pieces.
In relation to the proposed decision from February, the data showing the growth of turnover and profit of retail chains in the past two years were removed from the explanation.
Domestic products will be cheaper
The proposal of this decision, as stated, is the result of the harmonization of the list of products with the Chamber of Commerce and its goal is to protect "vulnerable categories of customers, with lower incomes, while at the same time preserving the economic activity of retailers in retail and wholesale".
"The special emphasis in the decision was placed on the products of domestic producers, which additionally strengthens the economy of our country, raises the competitiveness of the domestic economy and makes domestic products available and more affordable. The application of the decision will not threaten the business of business entities, and a significant effect will be achieved in protecting the living standards of citizens. Please note that it is a comprehensive action because it does not refer only to one item from a certain product group, but refers to all items from a given product category, so that it includes hundreds of product categories in every major retail chain," the explanation of the decision reads. .
Even earlier measures curbed inflation
The explanation states that data on the annual inflation rate in the period from June 2022 to February 2024 indicate the justification of the introduction and extension of measures aimed at establishing price stability and protecting citizens' living standards as much as possible.
"The annual inflation rate in June 2022 was 13,5 percent, and according to the latest available data, it was 2024 percent in February 4,8. Although inflation is mainly caused by external shocks and is the result of the action of numerous factors, such as problems of insufficient supply at the global level and the energy crisis, it is very important for the extremely open Montenegrin economy to adequately monitor the current situation and take timely measures in order to adapt new circumstances. The Ministry believes that the key factors that determine the general increase in price levels globally, such as the war in Ukraine, supply chain disruptions, the consequences of the COVID-19 pandemic, growing uncertainty, but also the newly emerging situation in Israel, continue to operate and in combination with other factors affect to the creation of inflationary expectations and create a certain inflationary pressure", the explanation of the decision states.
It is also noted that the factors that worked in June 2022 are still working, so "therefore it is necessary to continue with the implementation of the decision and to pay special attention in order to bring inflation under control and protect the purchasing power of citizens".
"Based on the available data of the Directorate for Inspection Affairs and regular reports and analyzes of MER, it can be observed, as stated, that there is an increase in the prices of products that make up basic food products, however, it is evident that for the majority of products for which restrictions on trade are in force margin, there was a decrease in retail prices", the explanation stated.
In MER, they believe that the previous decisions on lowering prices "had a favorable effect on the reduction of prices of basic foodstuffs and that they significantly protected the standard of living of citizens", in particular they "protected the standard of the most economically vulnerable categories".
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