site.btaTrade Unions Predict Price Spikes in Next Few Months

The Confederation of Independent Trade Unions in Bulgaria (CITUB) and the Podkrepa Confederation of Labour expect new price spikes in the next few months. Fast-moving consumer goods, such as foods, as well as non-food staples, will appreciate. Higher prices of bread, whose production is entirely dependent on natural gas, will have the strongest impact on households.

The trade unions warn of a persistent and growing inflationary pressure on households. Year-end inflation is expected to hit double digits.

BTA talked to experts from the Institute for Social and Trade Union Research (ISTUR) with CITUB and to Podkrepa economic adviser Vanya Grigorova about the impact on Bulgarian households of the war in Ukraine and the appreciation of energy sources.

The war in Ukraine will lead to price spikes, according to the ISTUR experts. They said: "We are already witnessing more expensive energy, natural gas and oil. The international commodity exchange prices of cereal crops, steel and aluminium are rising, which will be felt down the supply and production chain."

The ISTUR warned that this country is already experiencing high inflation rates. Foods saw an annual increase of 11 per cent, bread went up by 17 per cent, and cooking oil by 28 per cent. Soaring cooking oil prices in the last few days again raise the issue of the households' purchasing power and the need of stricter government control and sanctions, said the experts.

Being one of Europe's most dependent countries on Russian natural gas and oil, Bulgaria will experience dire consequences of the surge in gas prices, said the experts.

Some 40 per cent of Bulgarian households could be strongly impacted by the price spikes. Heating and home maintenance will turn into a challenge. More than 2 million Bulgarians cannot heat their homes adequately.

The CITUB demands the minimum wage to rise to 764 leva in the second half of 2022 from 710 leva in April. If no measures are applied, the trade union predicts company closures, job losses and poverty.

Vanya Grigorova said that while price gouging is a fact right now, a surge in prices will be justified in a month or two.

The only working solution in her opinion would be for the government to limit electricity exports, which will help businesses, public institutions such as hospitals and nurseries, and public companies in the water and sewerage and urban transport sectors.

Grigorova also called for a price cap on certain necessity goods.