Bread "Provocation"

The Day's correspondent turned to the commercial director of Mezokred Co., Serhiy Boryshchenko, asking whether it is possible to make money today on food products, what is happening in general, and where this might lead.

S. Boryshchenko: "Our firm trades in food products but, frankly, you can't make money on them today. I think that the steps official organs have taken to solve food supply problems will most likely backfire. With state regulation of sugar prices the wholesale price is already above the retail one. And today in general retail trade is very risky unless one has very good connections with certain organs. I greatly doubt that one can make money in this area, especially on flour and pasta products. Today flour has seen a big jump in price, and very many producers do not want to deal with lower grade products and making raw macaroni is losing its image. And where is all that flour and meal disappearing to? To Russia, I suspect."

The department of Naftohaz Ukrayiny (Oil & Gas of Ukraine) for natural gas imports and settling accounts with the Russian Federation confirmed as much: payment in commodities is going at full steam, while declining to cite specific figures. Thus it is difficult to agree with President Kuchma that "there are no economic grounds for this" (price rises - Ed.). Any schoolchild knows that when market supply falls, prices rise. And in this case the easiest thing to do it to blame "the base political forces that helped do this." Under such circumstances they include the President himself by leaving the impression that its basis is the pseudo-market situation in the economy, including the inability to pay, a situation for which he and the government he appointed bear responsibility.

INCIDENTALLY

As long as Ukraine fails to set up a system of state regulation of the market, there is no certainty that the country will not have a repetition of the May volatility in food prices, stated Oleksandr ZAVADA, chairman of Ukraine's Anti-Monopoly Committee on June 2.

The Ukrainian market, he said, has already gone through a number of tremors similar to the May sugar fluctuations. In 1997 there was a similar situation with gasoline, in 1998 with oil, and so on. And each time they are met with unprofessional official steps to counter processes, the "professional ignorance" of the persons responsible, ungrounded regulation of prices by local authorities, and attempts to artificially segment the nationwide market into local markets, leading to the creation of artificial monopolists.