Georgian PM vows to investigate soaring food prices
Georgian Prime Minister Irakli Kobakhidze has highlighted the sharp rise in food prices, promising to “get to the bottom of the issue” and hold those responsible accountable.
“The difference between Georgian and European prices is indeed quite significant,” Kobakhidze said in a video address to the public on Wednesday, News.Az reports, citing Georgian media.
According to the prime minister, the government conducted a study comparing key product prices in Georgia and European countries, producing alarming results.
“If we compare prices in the same international brand’s stores in Georgia and France, sunflower oil of a certain brand in Georgia is 34% more expensive, pasta — 97% more, rice — 180%, butter — 30%, cheese — 42%, and chocolate — 47%,” he said. “These price differences are caused by high markups from distribution companies and stores, which on average account for 86% of the price from the Georgian border to the shelf.”
Kobakhidze also noted that net profit margins in some retail chains in Georgia reach 7, 8, and even 14%, while in Europe they average 2%.
The prime minister drew attention to the “rapid expansion of retail chains” in Georgia amid high profitability. “Over the past five years, the number of chain stores in the country has doubled. As a result, Georgia now has 113 stores per 100,000 people, compared with 45 in Germany and 62 in Austria. The costs associated with expanding chains directly affect product prices,” he said.
Kobakhidze called on law enforcement agencies to conduct a thorough investigation to determine “whether there are signs of criminal activity by specific individuals.” He added, “The current practice raises suspicions that market participants may have acted in coordination, based on cartel principles, which naturally requires further analysis.”
The prime minister also proposed that parliament form a commission to study the issue, while pledging that the government would work actively with distribution companies to lower prices.
Earlier, the National Statistics Office reported that annual inflation in Georgia reached 4.8% in November, above the 3% target. Food prices had the largest impact, rising 10.3% year on year.
The increase in prices has emerged as the top concern among Georgians, according to the latest Eurobarometer survey.
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