In the editorial published yesterday, the issue of the cost of living was discussed from the political aspect, that is the way the two major parties are dealing with the matter. The Malta Independent wrote that while the Malta Labour Party continues to champion itself as the main protector of consumers, the Nationalist government has realised that it cannot continue to ignore the subject. Prime Minister Lawrence Gonzi has spoken at length about it in his recent public appearances, and a Malta Council for Economic and Social Development meeting has been convened for tomorrow to specifically deal with the problem.

Both the MLP and the PN agree that the rise in the prices of products that is being experienced in Malta is a direct result of what is happening on the international market. What they do not agree upon is the extent of this effect on local consumption.

The MLP says that the increase in the price of oil and cereals on the international market did have an effect on what is happening locally, but the prices have gone up much more than they should have. The PN, on the other hand, lays the matter squarely on the increase in the price of oil and cereals from abroad. The two continue to argue over this, with the MLP trying to gain as much political mileage from an issue that it holds close to heart, while the PN tries to defend itself by blaming the changes to international movements.

The relation between higher international prices and local increases also emerged from the second price monitoring report that the Union Haddiema Maghqudin published last Tuesday. The report involved the participation of mystery shoppers who bought items, most of them food products, from different parts of Malta.

The increase in the price of bread, cheeses, flour, milk and pasta between August and October were a direct result of the ever-rising price of grain in international markets, the report shows. Nobody doubted this, as the international media and reports that can be found on the internet have been saying this for quite some time. Naturally, the increases that have been registered in Malta have been felt in other countries too.

These products however only make up 15 per cent of the some 200 items that were included in the list for the UHM’s mystery shoppers. The price of most of the other products – 82.5 per cent – remained unchanged in the three-month period, while 2.5 per cent of the products actually became cheaper.

A quick look at the items on which there was an increase shows that they are all products that were affected by the price fluctuations on the international market. And it is therefore inevitable that the importers of such products have to increase the local prices to continue making a profit.

But the fact that the price of so many items remained unchanged in the three-month period shows that the importers are sticking to the deal they made with the government – that there will be no change in the prices of items they import at least until March.

The accord was reached to make sure that the switchover from the lira to the euro on 1 January will not lead to abuse, with prices being rounded off upwards. So far, generally speaking, importers have kept their word except for those items whose price increased from abroad, while the cost of the other items remained as it was.

Consumers now hope that the agreement will be honoured when the actual change of currency takes place, at least for the first three months of next year, perhaps beyond that too.