Distributors of imported powdered milk products have promised not to increase prices as part of efforts to stabilize local prices, the Executive Yuan said in a statement yesterday.
The move followed a meeting called by Vice Premier Jiang Yi-huah (江宜樺) last month to ask dairy product companies, which had reportedly been planning to reflect rising material costs by raising their prices, to join the government in tackling the price issues.
In the statement, Greater Tainan-baised Jyh Ferng enterprise Co, which imports infant nutritional products from Japan and other countries, said it will absorb the increased material costs and will not adjust its prices in the short term.
Other importers, including Abbott Taiwan, Standard Foods Corp, Mead Johnson Nutrition (Taiwan) and Orient Europharma Co also agreed to maintain their current prices, the statement said.
Wyeth Pharmaceuticals’ subsidiary in Taiwan and Nestle Taiwan will both hold promotions for new products, they said.
This will be a first for Nestle, which has never held a sales promotion in its 25 years in Taiwan. Jiang, who heads the Executive Yuan’s price stabilization team, expressed gratitude to the companies and urged more businesses to follow their lead. The statement also said that consumer protection officials will conduct random checks on powdered milk product prices in markets nationwide.
Meanwhile, Fair Trade Commission (FTC) Chairman Wu Shiow-ming (吳秀明) said the commission had undertaken a comprehensive investigation into the price hikes of some consumer products and would look into the consistency of tariff reduction on imported fruits.
“The FTC has assigned ad hoc groups to monitor the prices of more than 20 consumer products to prevent price manipulation,” Wu told the legislature’s Economics Committee.
The Directorate-General of Budget, Accounting and Statistics (DGBAS) reported last month that vegetable and fruit prices increased by 29.04 percent and 26.26 percent respectively on an annual basis, mostly due to adverse weather conditions and low base figures. Overall, the consumer price index rose 2.96 percent last month from a year ago, reaching its second-highest level in more than four years, the DGBAS said.
Asked by Democratic Progressive Party (DPP) Legislator Huang Wei-cher (黃偉哲) whether the government’s policy to reduce tariff duties on imported powdered milk, apples, kiwis and peaches is legitimate, Wu said businesses are not obligated to reduce prices of the items.
“There is room for the government to improve our approach of using customs duties adjustments to stabilize the prices of customer products,” Wu said.
Huang said that if businesses do not have to reduce prices, there is no need for the government to reduce tariff duties, which led the country to lose NT$115 million (US$3.93 million) in tax revenue.
In response, Wu said that the FTC’s intention was to help stabilize product prices for consumers.
“We will consider consulting with businesses prior to reducing customs rates in the future to avoid any loss,” he said.