site.btaState Commission on Commodity Exchanges Chair on Efforts to Rein in Food Prices

The “Affordable for You” initiative, launched by the Economy Ministry as a new measure to tackle higher food prices, aims to achieve better prices of around 50 staple foods based on a market principle. 

In the spring of 2023 the caretaker cabinet launched the platform foordprice.bg with weekly information about the prices of foods in the smaller consumer basket along the whole chain of supply which can be compared against the prices of the same products in several EU countries.  

"Both aim to raise public awareness, but Affordable for You wants to promote competition and make the relation between demand and supply more transparent," Vladimir Ivanov, chair of the State Commission on Commodity Exchanges and Markets, said in a BTA interview on Thursday. 

According to him, the aim is to make a voluntary commitment by both sides in demand and supply through the mediation of the state for a a completely transparent interaction while observing good trade practices. Indirectly it aims to increase the level of consumer confidence.

"The aim of “Affordable for You” is to achieve better prices for Bulgarian consumers. It is based on the principle of voluntary partnership between the state and the business, said Ivanov. The platform foodprice.bg is working. We are feeding information about wholesale prices only," he said.

The new measure aims to impact more swiftly the market in a voluntary way with regard to greater transparency. The more transparent the system becomes, the better the interactions will be - from the point of view of competition and of improving consumer culture. The whole information is published on the website of the Economy Ministry so that the State could be a guarantor and a link between demand and supply, as well as ensure greater trust. In an accessible way everyone can compare retail and wholesale prices and control their expenditures, he said.

The price forming is based on economic parameters and not based on some kind of pressure contrary to what the public perception is. Naturally, when demand is more informed, it will have its impact, but demand and supply will meet at the fair price, which is the result of completely transparent market interaction. 
 
To increase trust is the other aim, which is more indirect. 
 
The measure will be enacted for a limited period of time but if it bears results and helps the development of the environment, it can be extended, as long as there is good will, because it is voluntary. The same measure was very successful for nine months in France where the intervention was much stronger, but the store chains agreed to it. 

The business control best itself, but without a system it is difficult for market players to decide alone to observe the rules. Countries such as the Netherlands and Belgium have achieved branch regulation, which is much better than the regulation on the part of the state, but these are countries with very well-developed market systems. 

This doesn’t mean that the end profit will be smaller. For consumers a cheaper price means higher consumption and for producers – more output by removing what is unnecessary along the chain.