It is a basic theory in economics that prices fluctuate of all commodities based on the supply and demand under normal circumstances in any country. The Global pandemic of Covid-19 badly affected most countries and Sri Lanka was no exception considering the number of patients found and deaths recorded due to the pandemic.
The country was closed down completely for some time and quite naturally the national economy was affected badly. The Easter Sunday attack which occurred a couple of years ago also affected our income generating sector tourism badly causing a huge loss to the economy.
From the beginning of the year 2022, the country had been experiencing a very gloomy period mainly due to the wrong economic policies of the previous regime and the arrogant manner of handling very sensitive issues in vital sectors followed by the unprecedented degree of corruption in all vital State sector institutions which finally resulted in a public uprising against the Government.
There were acute shortages of supply of all essential commodities such as fuel, gas, electricity, fertiliser and all food items, medicine, clothing, stationery, electrical equipment, communication equipment, building materials, leather wear such as school bags, shoes and many more.
In addition to the scarcity, the prices of all these items skyrocketed within a very short period and the public upheaval turned into a violent force backed by radical political extremists and the incumbent Prime Minister and the President had to vacate their positions.
Under this extremely chaotic political, social and economic situation, following the constitutionally mandated procedure, the leader of the United National Party Ranil Wickremesinghe was elected the 8th Executive President of the country by a substantial number of majority parliamentarians.
While being the sole member representing the United National Party he had suggested to the then leader to seek IMF assistance to get out of this economic mess in a number of occasions but no positive response was received by them then.
From the first day of his ascendency to the presidency he worked tirelessly to get the IMF assistance to revive the economy while providing substantial relief to the public. Within a matter of months, Ranil Wickremesinghe’s Government provided much relief to the public and now there are no shortages of fuel, gas, electricity or essential food items.
Prices of all essential commodities such as rice, dhal, sugar, flour, infant milk foods and most of other consumer durables have gone down sharply while the prices of fuel, gas and transport costs also had been reduced.
Wheat flour is a main requirement for a number of daily eatables by the people such as bread, buns, biscuits and all other bakery products. The prices of wheat flour shot up to about four hundred rupees during the last few months of the Gotabaya regime and the people especially in the estate sector who use wheat flour as a staple food underwent immense difficulties with the high cost of wheat flour and they were forced to cut down on the number of meals a day.
The urban population who use bread and wheat flour related products as one of their main meals a day also suffered equally as all the bakery products almost became double or even more on some items.
Now that wheat flour is available freely at half the cost compared to that period, but the prices which shot up rapidly never returned to the previous levels despite the repeated requests by the authorities.
This is clear exploitation of the innocent consumers. We hear every now and then that ministers at media briefings and some other forums talk about the reduction of prices of essential goods as the rupee had been appreciated as against the dollar, but when you go to the market places, you don’t find any significant improvement that is advantageous to the consumers.
Role of the Consumer Affairs Authority
The main duty of the Consumer Affairs Authority is to look after the interest of the consumers with regard to the quality, standard and the prices of the commodities. But it is rather doubtful whether they are vested with adequate powers to provide the expected service of them as most of the traders do not abide by their decisions citing various excuses.
Agricultural products
There was a severe shortage of the supply of our staple food, rice and a kilo or a measure at rice shot up to over three hundred rupees in some varieties due to the lack of fertiliser and other essentials for the production. Similarly the ordinary man’s only nourishing food the chicken and eggs also increased to about Rs. 1,700 a kilo and Rs. 60-75 an egg. Now with the adequate supply of raw material for the production of chicken prices of chicken had not gone down below Rs. 1,500 a kilo.
A fairly decent packet of lunch which was sold at Rs. 350 earlier increased to over five hundred rupees and still remains the same in most eating outlets despite the reduction of preparing costs.
Usual practice of traders
It had been observed in the country that whenever there is an even a slight increase in the price of fuel, gas or any essential item, from the very next morning the businessmen concerned increase the prices of related goods and services although they have adequate stocks for weeks. But if ever there is a reduction in the prices their attitude is very lethargic and try to continue with the same prices as long as possible until the authorities intervene and advise them.
Stationery, exercise books, school bags and students’ shoes
The prices of the above articles also went up enormously and an ordinary exercise book of thirty rupees earlier, went up to 90 rupees making the poor man who has school-going children driven to a pathetic situation.
A couple of months ago the Government had a discussion with the local manufacturers and the importers of the above items and they agreed to reduce the prices of these articles and the Deputy Finance Minister Dr. Ranjith Siyabalapitiya had a press conference the same day and informed the public that the prices of the articles would be reduced in price substantially but up to date no significant reduction had been made on any of them.
Indeed it is the same position with regular medicinal drugs used by the people, especially for diabetes, high blood pressure, cardiac ailments and various other common diseases. Health Minister Keheliya Rambukwella recently said that the prices of medicines for the above ailments would be reduced immediately at least by 16 percent.
But when you visit the pharmacy for your regular quota of drugs, we don’t see any difference in the prices as yet.
The big-time business establishments in all sectors had formed their own Associations to defend their decisions and they are not sometimes flexible at all with the Government decisions.
The building construction industry was very badly hit with the economic meltdown in the country and prices of all material shot up to unbearable levels as the import restrictions were imposed on many items. With the economic recovery in the country, the Government a couple of weeks ago relaxed the import restrictions and the prices of a number of construction material were reduced substantially in order to jump start the construction industry which had been at a standstill for almost a year. But the general public complaint is that the prices of most material have not changed yet except for cement which has gone down by Rs. 350-400 per 50Kg. bag.
Similarly in all other vital sectors such as the textile industry, communication and electrical equipment, sanitary and hygienic lotions, beauty culture requirements and many more areas, prices could be brought down due to the relaxing of import restrictions. But it is rather doubtful if the consumers are benefited as the big time traders do not simply comply with the State instructions.
Indeed it is the prime duty of the Government to properly regulate and monitor the performance of the traders as the public had suffered heavily during the last almost three years due to the scarcities and unbearable high cost of living.
Now that under President Ranil Wickremesinghe’s vision and mission, the country’s economy is almost back on the correct track and relief measures in all areas of importance are being favourably considered. The Government should either strengthen the Consumer Protection Authority with more and more powers to nab the errant traders or establish a separate regulatory authority with expertise in all areas of vital importance and entrust them with adequate powers for the smooth functioning of the distribution of commodities to the consumers at stipulated prices.
Errant traders or businessmen should by severely punished as in the countries such as Singapore and Malaysia without dragging them to courts or take legal action which consumes more funds for the country’s coffers and unnecessary long delays.