2 Sep 2010 17:37

Grocery chains help to slow inflation

SARATOV. Sept 2 (Interfax) - Supermarket chains help to slow inflation, said Lev Khasis, the head of the Association of Retail Trade Companies (ACORT).

"Contemporary retail chains are a brake on inflation. They maintain lower prices than non-organized retail overall," Khasis, who is CEO of X5 Retail Group, said at a meeting of the State Council Presidium in Saratov on Thursday.

The retail sector does not see "any reason for prices to rise," he said. "State measures in the past few months have been quite effective and the small amount of froth that built up will begin to recede now."

Prices has risen on a handful of products, he said. "But because that growth is accompanied by lower prices on other products, inflation at the big retail chains was just 1% in the 12 months ending September 1, compared with 4.7% overall for food," he said, noting that "even in Moscow milk can be had for 22 rubles a liter."

"Prices in the various regions are closely linked to the development of major retail chains, the level of competition," he said, adding that there are a number of regions that are net food exports and yet have high food prices. President Dmitry Medvedev, noting that many governors were present at the Presidium, asked Khasis to name the regions. "I will definitely present them to you," Khasis said.

Khasis also asked the president to help resolve the problems with the tax treatment of losses. "Losses are not business expenses, but are paid for out of profit," he said. "We have raised this issue on several levels. There is an instruction from two first deputy prime ministers, meetings at the Finance Ministry. But not only is the issue unresolved. We have learned that the Finance Ministry has drafted amendments that would make the situation worse," he said.

Resolving the issue would help to hold down retail prices, he said.