Wimm Bill Dann company CEO David Yakobashvili will show his social conscience.
Photo: Valery Levitin
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Price Freeze on Some Foodstuffs
An agreement will be signed in the coming days between the government, food producers and food sellers to impose a price freeze on a number of foods. The government of Prime Minister Viktor Zubkov was forced to take this regulatory step due to high inflation, in spite of the protests of business organizations and the bewilderment of economists, who say that it will block agricultural development and diversification. The government is to approve the agreement by Wednesday.
Grocery chains will be required to limit their markups on socially significant food products (milk with fat content of 2.5 percent or less, nonfat kefir, sour cream, bread, eggs, sunflower oil, sugar and cheese) to 10 percent. Dairy prices rose fastest of all in September. The price of milk rose 7.2 percent in price, fermented milk products rose 7.9 percent, and butter and cheese rose 13.5 percent.
All large grocery chains and national food producers will sign the agreement. The Ministry of Economic Development and Trade denies that any government pressure was applied to the signatories of the agreement. The agreement is expected to be retroactive to October 15 and extend to the end of the year. It may be prolonged at that time. Producers are refusing to discuss the losses they will suffer from the agreement, but analysts say that the dairy industry could see a 30-percent loss of possible profits. For large dairy producers like Unimilk and Wimm Bill Dann, that could mean tens of millions of dollars.
www.kommersant.com
All the Article in Russian as of Oct. 22, 2007
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