Food prices surge

The cost of food has been rising faster in Belgium than in neighbouring countries. The Belgian Economy Minister, Vincent Van Quickenborne (Flemish liberal), has warned the social partners that the price rises are harming our competitive position in the world and that they should take account of this in the forthcoming wage talks.

Prices of processed foods rose twice as fast in Belgium in comparison with our neighbouring countries. This is one of the findings contained in the first annual report of the prices watchdog, the Price Observatory.

In Belgium processed foods like a loaf of bread, butter and spaghetti shot up by 1.4% last year. In neighbouring countries the price increase was only 0.6%.

Prices rose faster in Belgium because producers put up their prices when raw materials became more expensive, but failed to adapt prices again when these same raw materials became cheaper.

The price of services too rose faster in Belgium.

There is one consolation: gas prices fell and the average gas price in Belgium is now lower than in neighbouring economies.

Warning from Economy Minister

The Economy Minister Vincent Van Quickenborne says that Belgium's social partners will have to take account of these price rises when talks are held on wages and conditions.

In Belgium wages and salaries in the public sector are cushioned against price increases and they are automatically increased when price level rises exceed 2%.