The CMASF proposed to fix the prices of basic products to combat inflation
Experts suggest fixing prices for socially important goods for three to four months. We are talking about meat, eggs, milk and other essential products. This can be achieved through long—term agreements between producers and consumers, both corporate and government. The authorities should facilitate the conclusion of such agreements in order to reduce inflation. As of mid-July, it was 9.3%, according to the Ministry of Energy. The proposal is contained in the report of the Center for Macroeconomic Analysis and Short-term Forecasting (CMASF) "Etude 11. Inflation: a brief overview", which was reviewed by Izvestia.
To effectively freeze prices, such agreements must contain clear conditions and responsibilities of the parties, said Vladimir Chernov, analyst at Freedom Finance Global. It is also important to provide compensation for manufacturers in the event of a decline in profits.
A reduction in inflation is also possible due to other measures mentioned in the CICA report.: accelerating imports from friendly countries, direct supplies of farm products to cities without intermediaries, reducing duties on scarce goods and raw materials, tightening consumer loans, supporting production through tax incentives and by curbing tariffs of natural monopolies within the limits of inflation.
"These measures can smooth out price spikes, especially for socially important goods, but they are unlikely to change general trends. Currently, services, gasoline, and tariff indexation of natural monopolies remain the key drivers of growth. Without a tight monetary policy and control of budget expenditures, it will not be possible to achieve a steady reduction in inflation," said Vladimir Eremkin, senior researcher at the Presidential Academy.
Read more in the exclusive Izvestia article:
Reduced cost: the authorities proposed to fix the prices of basic products to combat inflation
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