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Government to restrict production profitability
06.11.2008 10:24 "Agro Perspectiva" (Kyiv) —
Cabinet is going to curb social food articles prices growth through their production profitability production limiting within 9-12%. Though producers affirm their incomes are already much down against these limits due to economic crisis, yet officials are really quite possible to use these norms in order to strengthen administrative control. Thus, on Fri Ministry of Economics had stipulated draft changes to Cabinet Decree (¹ 1548 from Dec 25, 1996) “About Establishing of Authority of Executive Power Bodies and Local Councils Executive Bodies regarding Prices (Tariffs) Regulation.” Changes were worked out to curb food articles high growth rates (which have reached 21.8% within Jan-Sept 2008). It is to be admitted, within same 9 months (Jan-Sept 2008) social food articles prices have boosted much more: thus, bread prices have surged by 22.3%, macaroni products – by 22.7% and meat products – by 35.5%. In part., Ministry of Economics has proposed to bring changes to Art. 12 of Decree ¹ 1548 (which regulates authority of Regional State Administrations, AR of the Crimea Ministers Council and Kyiv/Sevastopol Municipal State Administrations). As of now, these bodies may fix social food articles profitability limits themselves; however, Cabinet plans to introduce profitability upper limit: thus, flour, bread, macaroni products, groats, meat, sausage products (save for highest grade products), milk and cheese profitability upper limit mustn’t be over 9% (sour cream, butter, sunoil, hen eggs and granulated sugar – not over 12%). Ministry of Economics experts affirm new limits will “restrain these goods groups from getting more expensive and create conditions to prevent their prices unreasonable growth.”
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