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Price Controls Return in Fight With Inflation

Published: August 15, 2014 (Issue # 1824)



  • Apples from Chuvashia are replacing Polish fruit that the Kremlin has banned in retaliation to Western sanctions.
    Photo: Vladimir Filonov / SPT

After a 20-year hiatus, direct Soviet-style price controls on the retail sector may be coming back, as the government strives to fight price hikes in supermarkets following Moscow's decision to ban swathes of Western food imports in retaliation for sanctions over the crisis in Ukraine.

The Federal Anti-Monopoly Service — the government's go-to body for browbeating retailers — is showing new vigor in the aftermath of the ban, which barred the import of meat, fish, fruit, vegetables and dairy products from the U.S., the European Union, Canada, Norway and Australia — all of which have slapped sanctions on Russia in response to Moscow's annexation of Crimea and support of separatist rebels in eastern Ukraine.

But it is not the state's only tool to fight price rises caused by the sudden rupture with European and North American suppliers.

After a series of top-level meetings involving Cabinet ministers, retailers, food suppliers and producers, the government this week produced a list of 40 food categories including meat, dairy products, bread, fruits and vegetables — together accounting for up to half what supermarkets sell. Retailers will have to report daily to the state the quantity and price of these goods, newspaper Vedomosti reported Wednesday, citing sources at two major retail chains.

This monitoring zeal beats even the Soviets, who under the planned economy required weekly stock reports from stores, but it has yet to translate into bona fide price controls.

"So far the government is just monitoring prices, but this could be followed by changes to legislature to put a freeze on them," said Valery Mironov, chief economist at Higher School of Economics' Center for Development.

Any new price controls would be ineffective, analysts said. One way or another, businesses will find ways to cover costs and generate profit.

"Prices will either grow in categories not on the ban list in compensation for the freeze or there will be a delayed price hike for the listed products," said Natalya Kolupayeva, senior analyst at Raiffeisenbank.

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ALL ABOUT TOWN

Sunday, Dec. 21


The Zenit St. Petersburg basketball team returns to the northern capital this evening for a matchup with Krasny Oktyabr, a Volgograd-based basketball club. Tickets for the game, which tips off at 6 p.m. this evening, can be purchased on the club’s website or at their arena, Sibur Arena, on Krestovsky island.


Satisfy your sugar cravings during Sweet New Year, an ongoing seasonal festival at the Raduga shopping center. Each weekend of December will welcome hungry visitors to taste hundreds of different kinds of desserts. Workshops are open to visitors and seasonal gifts can also be purchased for those rushing to finish their New Year shopping.



Monday, Dec. 22


Pick out the latest fashions as holiday gifts for loved ones or as early presents for yourself during the Christmas Design Sale at Kraft on Obvodny Kanal, starting on Dec. 20 and continuing through Dec. 27. Designer clothes will be on sale every day of the week or you can buy something more festive to decorate the home while sipping on hot coffee and perusing the various master classes.



Tuesday, Dec. 23


Meet Arctic explorers Fedor Konukhov and Viktor Simonov during SPIBA’s and Capital Legal Service’s event “Arctic Expedition” this morning in the Mertens House business center at 21 Nevsky Prospekt. The meeting will discuss the explorers’ ongoing eco-social project and how companies can use the project as a unique marketing opportunity. Email office@spiba.ru by Dec. 22 if you wish to attend.



Wednesday, Dec. 24


The Anglican Church of St. Petersburg we will be holding a Christmas Eve service at 7 p.m. led by Rev Wm. Shepley Curtis of the Episcopal Church. The service will be held at the Swedish Church at 1/3 Malaya Konyushennaya Ulitsa.



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