Ensuring market competitiveness is necessary to control the spiraling price of commodities instead of governments intervention to control prices, said speakers at a discussion on Saturday.
They also said flawed market management or merchants syndicates are not the only reason for price hike. It is mainly absence of market competition to force traders to keep prices down and at par.
They made the remarks at a roundtable discussion on "Commodity prices, market management and competition," at Bangladesh IP Forum at Azimur Rahman conference centre of The Daily Star Centre.
They said the price of daily essentials can rise for reasons, such as inflation, increase in dollar price, price of raw material, fuel, or inclement weather conditions such as heavy rain or drought, said Prof Md Helaluddin of economics department at Dhaka University.
"Product pricing, market regulation, fair competition and protection of consumer interest are very important for economic growth of the country. Producers, suppliers and consumers can all benefit from a strong competitive market ecosystem…." he said.
He said market will become automatically stable at one stage if it is allowed to run on its own instead of intervention. If the market system works properly, he said price of commodities will not increase without strong reasons, such as cost of production. He further added a strong market system will reduce poverty, increase investment, and generate employment.
Around 80 percent of people in the country are hit hard by ongoing price hike of commodity, said Md Khaled Abu Naser, former director of Bangladesh Competition Commission.
He said if market syndicates can be rooted out, then most of the price hike problems can be solved. High prices however encourage investors and create new entrepreneurs, which help generate employment and induce economic growth.
He added that in this case the regulator should be careful so that big conglomerates cannot occupy the market to create a monopoly.
Fair competition expands market and benefits consumers, said AK Enamul Haque, dean of faculty of business and economics at East West University.
"So, the regulator should be cautious about unfair practice by big conglomerates. Otherwise, good and real manufacturers may quit the market facing unfair competition to eventually affect the economy," he said.
He suggested not to abusing laws against manufacturers and rather finding out the actual reason behind price increase.
According to him, there is no provision to punish entrepreneurs for forming syndicate or cartel without proper evidence.
Hamidul Mishbah, founder of Bangladesh IP Forum, said while syndicate is not always bad, however, if syndicates are formed with the aim to create artificial crisis in the market, it is a punishable offence.
Practically there is no clause for market syndicate in any law in the world including Bangladesh, he added.
Bazlur Rahman called for creating public awareness about competition law and the actions of competition commission in controlling commodity prices.
Gawher Nayeem Wahra, writer and researcher, and MS Siddique, adviser to the Bangladesh Competition Commission, also spoke on the occasion.
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