2 August 2014

Ethiopia: Beverage Producers Ordered to Cut Price

The Ministry of Trade last week ordered beverage producers to cut the recently surged market prices on their respective products.

In a meeting MoT called last week with beverage producers of soft drinks, beer and bottled water, the manufacturers were told to make sale adjustments to its sales prices before June. They were also told that the price adjustments that saw the surging of sale prices in the past couples of months are "irrelevant."

The meeting, chaired by Trade Competition and Customers Protection Authority Director General, Merkebu Zenebe said "some producers have made irrelevant and inappropriate price increments. Before we go to legal action, we urge them to take correction mechanisms. Otherwise we are forced to pursue legal action."

During the meeting at the MoT conference hall, soft drinks, beer and water products' prices are said to have surged in connection to the government's announcement of salary increments for civil servants listed out in detail.

Both officials of MoT and the authority explained that they gathered evidence from retailers that they were indeed forced to increase sale prices following their buying prices. They blamed producers and suppliers for increasing the sales prices of each product.

A senior advisor at MoT, Nuredine Mahamed told the meeting that "the current price adjustment has been made with no economic reason." He added that the price of beer since last month has shown over an eight percent increase and the increment has been witnessed boldly since June.

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