The Ministry of Finance and Ministry of Health have exchanged blame over unmanageable rises in prices for baby formula, with no solution in sight.
Vietnam considers tightening control over milk price
Public concerns have been recently raised when these two ministries were passing the responsibilities on each other and blaming each other for inadequate policies.
Recently the Ministry of Finance (MoF) sent a report to the prime minister in which it claimed that it was unable control nutritional and milk-supplemented products as many products have been re-labelled in accordance with the Ministry of Health (MoH)’s new regulations.
MoF claim means that the MoH should be responsible for the uncontrollable rising prices of imported milk.
Nguyen Thanh Phong, Deputy Director of the MoH’s Department of Food Safety and Hygiene, however, said, “Over the past five years milk prices have continued to increase annually before the issuance of the regulations on formula milk re-labelling. It’s popular that traders of foreign milk products make big profits in Vietnam.”
While their arguments have no deadline for an end, consumers continue to have to bear irrational milk prices. Many have to tighten their belt to prioritise spending for their baby milk.
An anonymous official from a milk company said that it’s inadequate when the MoF blamed product re-labelling for unmanageable milk prices.
“In fact the MoF should be held accountable for inefficiently management over business expenses,” the official commented.
According to the official, the MoF was really able to control milk prices if it effectively used available tools like inspection, customs agencies, market watchdogs and tax tools.
Meanwhile, Associate Prof and Dr. Ngo Tri Long said that uncontrollable milk price hikes were a result of the lack of responsibilities by both ministries.
Long, however, state that the MoF should be first to blame for their lax management despite being empowered with several price management tools.
“Being functioned to manage prices, the MoF should make report to and propose the government to apply suitable measure in cases of any irrational price hikes. It should also conduct inspections to tighten control over the market,” he noted.
A price expert said the MoF didn’t apply strict measures over irrational milk price hikes maybe because it’s afraid of being held accountable. Inspections over milk prices should be conducted as soon as possible and the results and solutions should be made public.
Market watchdogs said currently there are over 500 formula milk products in Vietnam which are all produced and distributed by 200 private companies without the participation of any state-owned enterprises. This is strange as milk is among the list of 14 good items subjected to the government’s price stabilisation programmes.
Nguyen Tien Thoa, Vice Chairman of the Vietnam Price Appraisal Association, said recent inspections found that advertisement expenses by several milk companies were up to 40% higher than the regulated rates, adding to the product prices.
“It’s possible to tighten control over milk prices. With evidence of inflated selling prices compared to the import prices, relevant authorities are able to conduct an inspection and strict punishments should be applied to violators,” Thoa added.
