Starting July 1st controls will be applied on the maximum prices of products in a list of 22 staple goods.
Sirloin steak, rib steaks, ground beef, shanks, breast, pork chops, chicken, tuna, sausage, high quality rice, macaroni, bread, onion, yam, potato, domestic tomato, cassava, beans and lentils, are some of the goods whose prices will be controlled by the State, by decree in force from July 1, 2014, the first day of the new administration.
“‘We know the average purchase price of food last year and we are clear about these 22 products because we studied them one by one … For the first time Panama will go back to an emergency price control scheme and 22 products in the basic food basket will come under price regulation – margin control in order to avoid speculation in staple products’, said the elected President Juan Carlos Varela. ”
“Pedro Meilan, Manager at the Authority for Consumer and Defence of Competition (ACODECO), stressed that price controls can be applied through price regulation or by a price freeze. ‘What has to be determined is whether to freeze the price or the margin, meaning that it will not be the case that there will be no increase over a certain point and it will stay that way forever, or whether to regulate it, which means it will be revised from time to time in order to see if it should be increased or lowered’ he said.”
Source: Panamaamerica.com.pa
If you want to see the effect of price controls take a look at Venezuela.
A very bad start for the new administration. Time to leave Panama if you want to eat good cheap food.
Harry
Oh boy, this smells like Hugo Chavez has returned and entered Varella’s body..
I can’t imagine President Martinelli won’t call Walmart and sell Super 99 out in July..
Very sad politicos say these things to folks who can’t understand how detrimental they are.
Sampson Valverde
David
The history of price control in latin america is very negative, once their put in place it is politically impossible to eliminate them since voters expect the prices to freeze forever, they always produce scarcity of the products whose prices they pretend to control since producers will switch to products not controlled, and they never actually control prices, the prices always go up in leaps since every time there is acute scarcity of the products the government is forced to increase prices so that producers will star producing again. As a businessman Mr Varela should know that. Itis a very bad start for his government.
Dear Friends
I love Panama and its people. But to try to control prices is a big big mistake. It never works ever anywhere in the World and it will not work for Panama either. You will remember that in 5 years time. First big mistake by the President. But when you make promises ……..
Another reason Panamá is forward thinking. Would one see this in the states…hell no ;~ ))