Govt struggles to lower food price
Govt struggles to lower food price
The Lao government needs to revise its policy on food price control as the current measures are not effective.
The government has introduced a number of measures including setting up ceiling prices for major food items and encouraging vendors to display the prices of their goods, aiming to make it easier for commerce officials to inspect the prices and fine vendors who violate the orders.
Desp ite increasing efforts, the price of food continues to rise against the policy, causing negative impact for people, in particular civil servants who face living allow ance cuts, and people with low incomes.
According to a report from the Lao National Statistics Bureau, the Consumer Price Index (CPI) saw a 0.45 percent increase in December compared to the previous month, causing inflation to remain high at 6.65 percent in the same month.
The main driver of the CPI and inflation in December was still the increasing price of food. The CPI of food and non-alcoholic drinks saw a 12.4 percent increase compared to the same period las t month.
Officials from the bureau said that the price of food including fish, poultry, pork, beef and seafood saw more than a 10 percent increase compared to the same period last year. The main cause for the food price increase was an insufficient supply of the goods while demand for food increased.
The second main driving force of the inflation in December was restaurant and hotel service. The inflation rate in this category was 9.87 percent up compared to the same period last year. The officials did not expand on why the service saw such a big cost increase .
However, many observers said that the service price increase was due to a higher demand for the service during celebration periods such as International New Year and wedding parties.
The increasing price of clothes and shoes, alcoholic drinks and cigarettes also saw rapid growth as the CPI of these categories experienced an annual increase of 6.87 and 6.56 percent respectively. The CPI of the water supply, electricity and cooking gas category saw an annual increase of 3.49 percent.
Economists said that one of the measures which the government should take serious action on to curb the rising price of food was to promote agricultural development in the country, adding that the agriculture sector saw only a 3.3 percent growth, illustrating that the production of food does not necessarily grow despite the industry employing the largest proportion of the population.
They said that the government should provide more loans to boost food production. At present, most of the loans are being injected into construction and real estate development. The farmers also need technical support from officials so as they can lower the cost of production and produce enough food for domestic consumption.
vientiane times
