Last updated: 5 June, 2012

Israeli government slams local food monopolies

The Israeli food market is plagued by lack of competition, keeping prices among the highest in the developed world, a government commission found on Monday.

The conclusions of an inquiry by the trade ministry and the treasury showed that while in 2005 local food prices had been between 10 and 20 percent cheaper than in other member economies of the Organisation for Economic Cooperation and Development, by 2010 they were 10 to 20 percent higher.

“An analysis of centralisation in 22 categories of food product showed that in 2010 Israel had the highest degree of centralisation in 11 of them and the second-highest in five,” the trade ministry website said.

It said that two main supermarket chains, Shufersal and Mega, between them held a 64 percent market share.

“The result is an oligopoly,” it added. “Little competition, few players.”

Thousands of Israelis marched on Saturday in three major cities against social inequalities and the high cost of living, in an attempt to rekindle last summer’s broad protest movement.

The largest rally was in Tel Aviv, with more than 3,000 participants.

In Jerusalem more than 1,000 people headed towards Prime Minister Benjamin Netanyahu’s residence bearing placards saying: “Swinish capitalism is not kosher”, “We want justice, not charity” and “The people demand social justice.”

Several thousand Israelis held social justice demonstrations in major Israeli cities last month.

In September, nearly half a million Israelis took to the streets to protest against high rents and social inequality.

Israel was admitted to the OECD in May 2010 and hailed that as a mark of its emergence as a developed economy.

President Shimon Peres is to meet visiting OECD Secretary General Angel Gurria on Tuesday for talks on the economy.