Lagos, Sept. 1, 2024 -The Centre for the Promotion of Private Enterprise ((CPPE) has advised the Federal Competition and Consumer Protection Commission (FCCPC) not to turn itself into a price control agency.
CPPE gave the advice on Sunday in a statement issued by its Director General, Muda Yussuf.
It said the FCCPC was unwittingly transforming into a price control agency rather than a consumer protection commission as it had focused on the retail segment of the economy and pricing issues.
CPPE said, rather the primary mandate of the commission is the creation of a robust competition framework across sectors and protection of consumer rights and interests.
“Consumer protection is not about directly seeking to control price at the retail end of the supply chain. This is why the CPPE is concerned about the approach, methodology, targeting and the recent threats by the FCCPC to market leaders, traders and supermarket owners.
“The commission seem to be fighting the symptoms rather than dealing with the causes of the current inflationary pressure in the economy. Even then, the core mandate of the commission is not to fight inflation.
“The fiscal and monetary authorities are statutorily responsible for macroeconomic policy issues and are better placed to deal with the challenge of high prices,” it said.
CPPE said the best way to protect consumers from exploitation is to diligently promote competition across sectors as our experience with the telecoms sector had amply validated this position
It said the FCCPC’s emphasis should not be on pricing, but on deepening the culture and practice of competition and a level playing field for all investors.
CPPE said the FCCPC needed a proper comprehension of the dynamics of pricing and the key drivers of inflation. These factors include the naira exchange rate depreciation, high energy cost, high cost of logistics, seasonality of food production, high cost of funds, extortions on the highways, high post-harvest losses, high cargo clearing cost, impact of the insecurity on food production, climate change and global factors disrupting supply chains.
“Our view is that the proposal by the FCCPC to traverse markets across the country with objective of ensuring price regulation is unlikely to yield concrete outcomes.
“This is not a sustainable strategy. What we need to fix are the fundamentals driving production, operating and distribution costs which resulted in spiraling inflation in the first place.
“The dynamics of pricing and prices in an economy are much more complex and fundamental and do not seem aligned with the comprehension of the FCCPC on the issue.
“The variables are numerous, multidimensional and dynamic. It is difficult to make pronouncements on issues profiteering in such circumstances without a rigorous analysis based on data.
“The CPPE appeals to the FCCPC to refrain from further intimidation of the operators in the retail sector of the economy most of whom are micro and small businesses, with many in the informal sector.
“The sector creates millions of jobs across different levels and geographical jurisdictions.
“There is an emerging risk of market suppression and private enterprise repression by the FCCPC, if the current trajectory continues. This marks an elevation of regulatory risk in the Nigerian economy which is detrimental to investors’ confidence.
“It should be appreciated that these traders are also victims of the current economic headwinds, especially the inflationary pressures.
“High prices negatively impact their sales and profit margins. Many of them had in fact shut down their businesses because of the current economic shocks.
“The commission should work in collaboration with the other agencies of government to tackle the fundamental causes of inflation in the economy,” CPPE said. (GBN)
