The first vice president, Nadia Calviño, has left the door open this Thursday for the Government to adopt new measures to contain the escalation in food prices. “What we are going to do in the Government is to continue making the right decisions,” Calviño said during her appearance before the Economic Affairs Commission of the Congress of Deputies.
Up to three times, in three different acts, the vice president has explained throughout this Thursday that the Government “is following the evolution of all margins and prices throughout the entire value chain of the agri-food sector“, with the aim of “having all the necessary information and thus being able to articulate the measures that are necessary“, effective and avoiding” collateral damage.
Although the vice president did not go so far as to give clues about the possible new measures, upon her arrival in Congress she did point in the direction of the companies: “At this time we have to do a very special follow-up of the business margins of the entire value chain, because it is time to all row in the same direction and that companies also contribute to containing the price of food and thus help Spanish families”
Already during his appearance, Calviño added that the information provided by the Food Price Observatory and by different private entities with which the Government is working shows that the descent of VAT that came into force on January 1 for a large basket of food is being transferred to final prices. The analysis of the Bank of Spain also points in that direction, since they estimate that the VAT reduction has been transferred to prices by 90% (the rest would have been used by distribution companies to increase their margins). However, the Bank of Spain has also warned that food inflation will remain high in 2023, with an average price rise of 12.2% that will be added to the 12% already set, on average, in 2022.
Just as the main research services have already advanced, Calviño has advanced that the general inflation data for the month of March (whose advance will be published by the INE next March 30) will mean a substantial cut compared to the 6% rate noted in February. This will be due, above all, to the so-called ‘step effect’, since the comparison will be made over a month of March 2022 in which prices skyrocketed after the outbreak of the Russian invasion of Ukraine. All in all, the vice president has admitted that in the first part of the year, the inflation data will be dominated by “volatility”, compared to the unstable year of 2022.