Retailers warn that capping markups on food could triple the prices of detergents, cosmetics, and hygiene products

Extending the cap on commercial markups to all food products could lead to massive price increases for detergents, cosmetics and personal care products, warns Feliciu Paraschiv, vice president of the Association of Small and Medium-Sized Retailers. The measure is being considered by the Government and could be discussed after November 12, when the National Institute of Statistics will publish the latest inflation data.

At present, the cap applies to a list of basic food products and is in effect until the end of the year. Paraschiv argues that reducing food margins could prompt retailers to raise prices for non-food products, through the “waterbed” effect, in order to recover their costs. He estimates that the prices of detergents, cosmetics and hygiene products could even triple.

The retailers’ representative is asking the authorities to examine the entire price-formation chain, including the difference between the amount received by the producer and the price in stores. He believes the priority should be increasing domestic production and reducing imports, rather than stimulating consumption. However, Agriculture Minister Florin Barbu argues that the measure could support processors and preserve jobs.