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release:
The French government said on Monday it had reached an agreement with major retailers to cap the prices of many food items to make it easier for consumers to absorb inflationary pressures.
Finance Minister Bruno Le Maire said retail groups would cut prices on a wide range of food items by June, with the option at their discretion, “to the lowest possible level”.
That would make April-June a “disinflationary quarter,” he told reporters after a meeting with retail business chiefs.
Retailers have agreed to cover the cost of the scheme, which Le Maire said would amount to “hundreds of millions of euros (US dollars)”.
Food prices rose 14.5% year-on-year in February, according to the National Bureau of Statistics INSEE.
Most of France’s big food retailers were in the talks, but market leader E. Leclerc was not.
“I’d rather cut prices across the board,” said chief executive Michel-Edouard Leclerc. “I didn’t wait for the public meeting to lower prices,” he told the CNews channel, adding that the deal could “give the impression that retailers are going to make up for it by charging more for other products.”
Some consumer associations are also skeptical of the “anti-inflation” initiative, which comes on the eve of yet another day of mass protests and strikes against the government’s plans to overhaul France’s pension system.
“Without any fixed price rules, the so-called ‘cut prices’ may actually be just the usual prices,” Olivier Andrault of the UFC-Que Choisir association told AFP.
But Le Maire said selected products had to be marked with an “anti-inflation quarter” logo in the colors of the French flag.
He said spot checks would be carried out to ensure retailers were not squeezing suppliers to make up for shortfalls in revenue.
Le Maire also said the government would start testing a “food check” system for low-income families in the coming months.
(AFP)
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