Price controls save family $58 monthly

THE AVERAGE Panama family of 3,8 persons will save $58 a month following the price freeze on 22 products in the basic food basket according to Government calculations.

 Increased food consumption in the staple diet of Panamanians and average prices of the past three months was considered when establishin he price conrols, said a La Prensa source at the Ministry of Commerce and Industry.
For example, the monthly consumption of approximately 55 pounds of rice, 13 loaves of bread, two dozen eggs, 23 pounds of chicken two and a half pounds of yellow cheese, seven pounds of cheap meat, etc. were calculated.
Price controlled bread will be $0.92 13 units at The average price in June was$1.60 per unit and with a total expenditure of $21on 13 there will be savings of $9.22 a month.
Fifty-five pounds of rice, at the uncontrolled priced was $32. With the price control should it will be $22.
To reach the programmed savings a price survey was carried out by the Authority for Consumer Protection and Defense of Competition (Acodec) along with statistical data used by the Ministry of Economy and Finance (MEF), and the Comptroller General.
The price cap was then established after extensive meetings with suppliers, producers, representatives of supermarket chains, retailers, among other business players,
Executive Decree No. 165 of 1 July 2014, fixes maximum prices of 22 basic food products, and also creates a “Price Revue Committee” made up of the Ministers of Trade and Industry, Agriculture and Finance, who will evaluate requests to submit price revues by individual companies, producer associations or business associations.
One of the determining factors in establishing control was choosing brands that were in a more economical range, because if it was considered the most well to do consumera would not notice the savings in their pockets
A rule stated in Article 2 says that business establishments must offer at least one brand with price controls. Maximum marketing margins to other brands, cannot be more than 10% or15% on the price of the retail cost price.

This measure was to avoid traders can uploading other similar markings so their profits are not affected.
The article gives Acodeco, the power, if necessary, to establish the specific brands that are regulated.
The decree also protects the rest of the 28 other products in the food basket, in that Article 8 says that retailers must report five days before the Acodeco of any retail price increase five days in advance. Although implementation of the measure is scheduled for Monday, July 7, some businesses like the El Rey Group began to apply the prices on Friday, July 4, with the logo of the National Government.
Some entrepreneurs and producers argue that this measure will bring shortages because of high demand that will be generated.
Others say that traders will be affected in profits after the rise in production costs causedby raising the minimum wage and electricity prices. Authorities have warned that traders who do not comply with the order will face a fine of up to $ 10,000.