“Georgian Prime Minister’s initiative is significant. This initiative and a similar type of monitoring will clearly contribute to further maintaining a low inflation environment in the country and ensuring stability of prices,” said President of the National Bank of Georgia (NBG) Natia Turnava in GPB First Channel’s Business Partner Programme remaking on Prime Minister Irakli Kobakhidze’s statement that market players may be acting in concert, following cartel principles.

According to Natia Turnava, the initiative aims at more transparency, logic, and prevention of pricing in the retail sector, so that the conditions of fair competition are not violated, and the interests of consumers are better protected.

“Maintaining price stability in the country is the NBG’s concern, and we have concrete leverage for that, which is the interest rate. By managing this, we are trying to influence inflation and keep inflation around the target in the medium term.

Whatever the NBG’s interest rate-related policy is, this leverage alone may make it difficult to maintain price stability if competition is disrupted in various segments of our small economy. We are convinced that this initiative will make a significant contribution to better managing inflation expectations and maintaining a low inflation environment. This is in full compliance with international practice, and there are relevant directives. It does not mean interference in free market principles. It is the government’s obligation to investigate any suspected violation of fair competition, cartel agreements, or illogical price increases,” she stated.

For information, Georgian Prime Minister Irakli Kobakhidze remarked in his video address regarding consumer prices that, amid high profit margins, companies are rapidly expanding their retail networks. He said that preliminary analyses indicate several key factors that may be contributing to high mark-ups and, consequently, elevated prices. According to the PM, existing practices raise suspicions that market players may be acting in concert, following cartel principles.