According to a report on Channel 12 News, Finance Minister Avigdor Liberman and Economy Minister Orna Barbivai are attempting to persuade food producers and importers not to raise prices, calling a decision to raise prices at this point in time “cynical and harmful to Israeli citizens.”
In a letter sent to the CEOs and presidents of large food companies and importers, the ministers stressed that the big companies also had an obligation to show national responsibility during this challenging period, and that they should take into account the economic situation when considering their profit margins. Liberman and Barbivai also noted that until 2021, the shekel strengthened significantly against foreign currencies while inflation remained low, meaning that imported foodstuffs were cheaper for the companies to purchase, savings that were not passed on to consumers in Israel, where prices were and remain the highest in the world.
Liberman and Barbivai added that they would continue to monitor the situation and would not hesitate to take the necessary steps in order to ensure fair competition and reasonable pricing.
“The crisis has yet to end,” they wrote, “and neither citizens nor businesses have entirely recovered – some are still being negatively impacted by the current Omicron wave of the virus. The Israeli government is doing everything it can to help them survive this wave, but we need the cooperation of the other players in the game too.”
In conclusion, the ministers expressed their hope that the companies would behave reasonably and cancel the price hikes they had previously announced. “Therefore, at this complicated time, it is hoped that you will demonstrate responsibility and announce that you have rescinded price rises … We will not hesitate to take the necessary steps to protect the market and ensure fair competition [if you do otherwise],” they wrote.
A few months ago, a report in Channel 12 News noted that many suppliers had requested of the companies that they raise their prices, in most cases by tens of percentage points, even though most of the items concerned are actually produced in Israel. For instance, the Wilifood company which imports a large number of products wanted to raise prices on five canned items: baby corn (10 percent), sweetcorn (11 percent), whole champignon mushrooms (10 percent), pineapple (20 percent), and vine leaves (20 percent).
The consumer price index rose by 0.3 percent in December, with notable price increases for clothing and footwear (1.1 percent), housing (0.8 percent), furniture and household goods (0.7 percent), and food (0.5 percent). Fresh fruit and vegetables, by contrast, saw their prices drop (2.7 percent), and cultural events became 0.8 percent cheaper.