Spain: Supermarkets reject commodity price freeze

Spain: Supermarkets reject commodity price freeze

MADRID (Reuters) – Spain’s biggest supermarket chains on Monday rejected a government proposal to temporarily freeze the prices of a basket of basic necessities to reduce the impact of inflation, calling for a tax cut instead.

The proposal to strike a deal with retailers to offer fresh produce, including fish, meat and eggs, at a fixed price through January has drawn skepticism from other companies and the opposition, who see it as price regulation.

Supermarket officials, who met with Labor Minister Yolanda Díaz and Consumer Minister Alberto Garzón on Monday, said they had already given numerous discounts and were making “extraordinary efforts” to pass the rising costs on to consumers as much as possible.

The three associations present at the meeting represent the supermarket sector in Spain, including the Carrefour Group, Alcampo, the wholesaler Auchan, El Corte Inglés or Mercadona, the country’s leading chain with a 25% market share.

“If you try to set a fixed price for the baskets, you’re trying to distort the relationship between the distributors themselves and the suppliers,” said Javier Millan-Astray, chair of the National Association of Large Retail Companies (ANGED).

The latter, in turn, are asking the government to reduce VAT on certain products.

Carrefour said last week it would offer Spanish consumers a basket of 30 basic products for €30, but that was before the government’s proposal and it didn’t include the fresh produce the government wants to see on the list.

Inflation reached 10.3% over a year in Spain in August.

(Report Belén Carreño and Corina Pons, written by Emma Pinedo and Christina Thykjaer; French version Diana Mandiá)

Reference: www.challenges.fr

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