Israel's government on Monday pressed leading suppliers and importers to cancel planned price increases that have stirred public anger while the economy is recovering from the COVID-19 crisis, Trend reports with reference to Reuters.
Food prices in Israel, excluding fresh produce, rose 3.5% last year, but in recent weeks, a number of companies have hiked prices amid the increasing cost of raw materials and transport, with inflation rising abroad.
There was no sign the seven companies that received the letters from Finance Minister Avigdor Lieberman and Economy Minister Orna Barbivai would heed the request, or that the government could easily force their hand in Israel's free market economy.
Reporting on the government's appeal, and echoing commentary critical of manufacturers and importers in other Israeli media outlets, the popular YNet news website urged consumers to shun brands that have hiked prices and to buy cheaper alternatives.
"Your announcements of price increases at this time is cynical and offensive to the citizens of the country," said the letters, seen by Reuters, citing a pandemic impacting the economy.
The ministers said if planned price increases were not cancelled, "we will not hesitate to take the necessary steps to ensure a competitive and fair economy."
A Lieberman spokesman said options on the table included adding more products under state price supervision. Lieberman had previously said he sought to end monopolies for importers.
At the same time, Israel's Competition Authority on Monday said it was checking whether price hikes were within the provisions of food laws.
One company that received the letter, Nestle unit Osem, had said it was forced to raise food prices by an average of some 5% amid higher costs for production and getting the products to consumers.
Osem on Monday was non-committal about the government's request, saying it was studying the letter.
Diplomat, a top importer, declined to comment, while rival importers Leiman Schulssel and Schestowitz said they would respond to the letters directly. Food company Strauss Group said it had no intention of raising prices.
The letters noted the shekel has appreciated sharply, meaning prices have fallen for importers, but those lower costs were not being passed on to consumers. Some firms, they said, also have distributed dividends.
Israel's inflation rate reached 2.8% in 2021, its highest in eight years but still within the government's 1-3% target and below inflation in much of the West that has led to interest rates being hiked.
Israel's central bank has insisted there was no concern over inflation at this time.