While the state strives for "fairer" prices, many economists are skeptical about tampering with the market. Assistant at the Faculty of Economics, Aleksa Dokić, tells "Vreme" that Serbia is leading the way in allocating households for basic necessities.
Meeting of Serbian Prime Minister Miloš Vučević with representatives of the largest retail chains did not bring concrete results. That is, Vucevic stated that in the next ten days he will announce concrete measures for "fairer prices" the most necessary foodstuffs.
He also reminded that the state sets basic regulations, but that it cannot impose product prices, because the market dictates them, although it can sometimes correct them by releasing goods from commodity reserves.
Assistant at the Faculty of Economics, Aleksa Dokić, told "Vreme" that the state should have a supervisory role, and that it must take care that all market players play by the same rules, that there are no illegal ones.
He adds that as for some deeper involvement of the state in the functioning of the market, "modern economic theory" does not support it.
"When we talk about the direct involvement of some state institutions or bodies in the process of forming the final retail price, modern economic theory says that this always gives an unsatisfactory final outcome compared to freely formed market prices in a capitalist market," explains Dokić.
Is it not always good to limit margins?
Our interlocutor indicates that, when talking about price formation, it is often mentioned that the margin should be limited. However, he says that this is not always a good approach because each branch has its own specificity.
"Of course, the margin rate of a retailer that sells goods in everyday consumption will be lower than one that sells specialized goods of high value." "It often happens that a retailer selling luxury goods has to employ an extremely skilled workforce, which he has to pay more than an ordinary manual worker," explains Dokić.
He adds that it should be borne in mind that Serbia is an import-oriented market, which means that we are drastically affected by all trends in the international market, where our imported goods come from.
On the other hand, continues Dokić, it should be borne in mind that we as a market spend less and less - "nominally observed, retail turnover is increasing, realistically observed it is falling, which means that we as customers are buying less and less".
"A better price - a price for the people"
Last year in September, the campaign "Better price - price for the people" was implemented and lasted until the end of last year.
The action entailed reducing the prices of 36 items from 20 product categories, mostly food.
The Republic Institute of Statistics analyzed the action and concluded that it did slow down the growth of the year-on-year inflation rate from October to November compared to September.
"Bolja cena" stickers can still be seen on certain products in stores, but on a much smaller scale because officially the promotion had a limited shelf life.
Dokić explains the paying power and the standard seen when looking at the percentage of a household's income that is set aside for basic needs.
"There you will see that we are unfortunately leading the way when we talk about European countries. "The average customer in Serbia allocates more than a quarter of his monthly budget for the purchase of the most basic necessities, while in European countries that share is significantly lower, for example 15 percent," our interlocutor points out.
The state currently has no money for the second installment of subsidies per hectare, announced the Minister of Agriculture in the technical mandate, Dragan Glamočić. Farmers were waiting for the promised help before the autumn sowing, while agro-economic analysts warn that the government's technical mandate does not release the state from its obligations.
The leakage of half a million liters of oil near Sisak stopped the transport of Janaf, on which the supply of the Refinery in Pancevo depends. NIS has requested access to state reserves, and experts warn that a longer interruption could stop production at the Refinery
The import of fossil fuels has cost Serbia more than 57 billion dollars in the past two decades, with a high price for the environment and the health of citizens. The energy transition is expensive, but its delay seems to be even more expensive
Due to damage to the pipeline on the Adriatic pipeline, crude oil transport to Serbia has been suspended, and the Pancevo Refinery is adjusting the volume of processing. NIS also requested diesel from operational reserves
Citizens could face new price increases in the coming months, partly due to the consequences of last year's administrative restriction of prices and trade margins.
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A black picture and the breakdown of the rule of law subscribeThe archive of the weekly Vreme includes all our digital editions, since the very beginning of our work. All issues can be downloaded in PDF format, by purchasing the digital edition, or you can read all available texts from the selected issue.
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