Latvia, Markets and Companies, Retail

International Internet Magazine. Baltic States news & analytics Friday, 10.01.2025, 02:28

PM: 1000% markups for goods indicates lack of competition in Latvian local market

Nina Kolyako, BC, Riga, 30.06.2010.Print version
The large price markups for some goods in Latvia – up to 1000% – reflects the country's small market and lack of competition, said Prime Minister Valdis Dombrovskis (New Era) in an interview with Latvian State Radio.

Valdis Dombrovskis.

The prime minister does not agree with the opinion that the large markups are connected with price-fixing cartels, "as retail in clothes, cosmetics and other mentioned products is such a decentralized business, with so many small players."

 

Dombrovskis rules out that the huge markups could be connected with the state's taxation policies: "If, for example, Estonia has VAT rate of 20%, and in Latvia it is 21%, then this is not what is determining these 100% markups."

 

Large markups for non-food products is characteristic for Latvia, according to the results of monitoring of the non-food product market carried out by the Competition Council, informs LETA.

 

 For example, the markup for knitted products on average exceeds 200%, or three times the manufacturing cost, while for some cosmetic products the markup exceeds 1000%, or 11 times the manufacturing cost.





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