There is no gain denying the fact that the commodity prices in our various marketplaces are over the roof of the common man; whether it’s the price of essential commodities or non essential commodities, the story is the same. However, what has been under reported is the efforts of the Olatuji Bello-led Federal Competition and Consumer Protection Commission to curb the exploitative practices in our various local markets.
This occurs when marketers over inflate the prices of their goods in order to make huge profits at the expense of the final consumers.
Final consumers consist of all persons who are the end users of these products, the worst hit are the people in the lower rank of our economic ladder who are often the majority. Accordingly, Nigerians can attest to the recent revelation by the Chairman of Bua Cement Company, Dr. Ishaku Abdulsamad Rabiu, when he said: “We were selling cement at N3,500 with the expectation that dealers and retailers would pass the benefits of the low price to end-user customers, but some were selling at N7,000 and N8,000 per bag, making a lot of money from the very high margin. I think we sold more than a million tons at N3,500 before we realised what the dealers were doing.”
Rabiu made this disclosure at the 8th Annual General Meeting of the company in Abuja. He added that the activities of those intermediaries undermined his company’s policy to maintain the N3,500 per bag price in 2023.
Collaborating the position of the BUA boss, the Executive Director of the company, Kabir Rabiu, added: “We actually sold our cement for three to four months at N3,500. We thought other players in the cement industry would join us in making the price of cement affordable, so BUA Cement had to discontinue its low-price policy as it was not intended to subsidise dealers.”
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Dr. Rabiu attributed the high cost of cement to the exploitation of consumers by middlemen within the supply chain. He added that the company could not control the prices in the open market, where dealers were making substantial profits from the high margin.
Similarly, we also read the recent revelation by a popular economist and the Executive Director of Financial Derivatives, Bismarck Rewane, when he alleged that some civil servants bought 50kg bags of rice at N40,000 and resold it at N85,000. Rewane said the price of rice at the “Parallel market” increased by 3.62 percent to N85,000 from the normal N83,000 despite the government’s subsidised price of N40,000. He made the allegation before the Federal Government suspended the N40,000 per bag rice initiative.
These and many other factors are the reasons the Federal Competition and Consumer Protection Commission decided to issue a directive to marketers to sell their items within reasonable prices and stop the unreasonable exploitation of the Nigerian consumers. Here is what FCCPC said: “Price control is entirely outside the scope of our responsibilities, we have never considered nor will we ever consider intervening in the market to regulate prices… Our recent directives are not about controlling prices but are focused on curbing exploitative behaviours that distort the market place and harm consumers. We encourage all businesses to engage in critical and lawful practices that contribute to a fair and competitive market place… Our role is to ensure that the market operates on principles of fairness, transparency and accountability.”
But some cartels in the market chain distorted the original version of the statement and alleged that the FCCPC was planning to introduce a price control mechanism whereas that was not what the statement said. Instead of facing the truth, some members of these cartel networks resorted to chasing the shadows by sponsoring propaganda against the commission in the media with the aim of inciting the people against the leadership of FCCPC. The simple truth is that these cartels are afraid of what would be their fate when the one month grace period given to them to sell their communities within rational prices by the commission expires.
Here is what the commission said: “We have granted a one month moratorium before enforcement begins, providing businesses with the necessary time to adjust their practices and ensure full compliance with laws aimed at protecting consumers and fostering fair competition. The FCCPC stands firm in its commitment to enforcing the Federal Competition and Consumer Protection Act (FCCPC) 2018. We will continue to monitor the market place and take action against business practices that violate the law. Consumers and businesses alike can trust that we will remain vigilant in uplifting the principles of fair competition and ensure protection.”
At this juncture, all Nigerians of good will must rally round the FCCPC as it strives to allow the forces of demand and supply to determine the prices of goods in Nigeria and not price fixing by some cartel networks who are only interested in the money they would make and not the value they would add to the overall economic development of the country. Kudos must also go Mr. Olatunji Bello for summoning the courage to confront these forces in the market place who have been suffocating Nigerians with exploitative practices that have no correlation with the laws of demand and supply.
. Comrade Uhara is a Public Policy Analyst.
