With the coming of the holy month of Ramadan, the price of basic and essential food items have exorbitantly increased in Maldives.
There are reported cases of profiteering by some traders leading to the unreasonable price increases.
In a free market, intense competition among suppliers and reasonable diversity of stock must be made available for consumers. If this were the case, no supplier is going to resort to hording of products to increase price because consumers can always buy from another supplier.
In Maldives there is a need for tougher preventive and punitive measures.
The experience of this problem in other countries shows that legislation against profiteering is difficult and expensive to implement and the effectiveness inconclusive.
The theory is that when there are many sellers, and many buyers, prices will find their own equilibrium. Many countries have found that legislation has not been very effective and increasing competition was a more effective solution.
In Singapore, the NTUC Fairprice formed in 1973 as NTUC Welcome Supermarket, in order to solve the rising oil and daily prices then due to inflation maintains a basket of 400 essential items for which they have pledged to keep prices low.
NTUC Fairprice conducts regular price surveys which demonstrates their commitment to keeping prices low for the benefit of their customers.
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3 comments:
STO was setup in line with NTUC Fairprice concept until STO began retailing donations received (staple food) far higher than the private sector. STO seem to have lost sight just as they gained it.
STO is a profit oriented company, which is not required to give consideration for the needs of the people for affordable food supplies. But that is the excuse for which they have been awarded a large portion of the land scarce Male' the capital and other parts of the country.
And in Maldives the politicians rather have all these problems to keep them busy, rather than take proactive measures to prevent these sort of problems.
STO was setup to skim public money for regime cronies. It still works the same way and fulfills the pourpose.
And being good during Ramazan means ripping people off by price gouging?
Any Sheikhs wanna talk about this?
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