A. Vizickas on the price situation in Lithuania: big players can “brainwash” | Business

A. Vizickas spoke regarding this in the Seimas, where he visited at the invitation of the Seimas Democratic faction “Vardan Lietuvos”.

“Regardless of how many competing companies there are in Lithuania, you won’t usually notice the competition. Only a systemic approach might somewhat improve the situation. One of the biggest problems is that even when the income of the socially vulnerable group increases, that income is absorbed well enough and the consumer himself does not get more welfare. No matter how much the state tries to increase revenues, we still have a situation of a hole in the bucket – the more you pour in, the more it will run out,” said A. Vizickas.

According to him, the institutions that should promote competition are doing reactive work today.

“As for advertising supervision, it is done when the user usually already complains. Trying to find the easiest way. We know that business has funds and can wear out state institutions in the courts. But we would ask such institutions to be oriented towards taking certain actions, which, first of all, would clearly identify the problems, carry out monitoring, and promote transparency in this area. Even posting prices online is a big step up from going to the pharmacy and seeing some prices and not knowing if it’s a good deal or not. But if I look on the Internet, I will know that those medicines are much cheaper there,” he said.

A. Vizickas believes that the aforementioned institutions should have the authority to take certain actions – not to impose a fine.

“The fine does not mean that we have cured the disease. Because the fine for the pharmacy falls on the user’s shoulders, then it needs to be compensated. Pharmacies don’t start competing any more from that,” he stated.

Personal archive photo/Arūnas Vizickas

There are other measures, according to him, including attracting investments, creating a certain greenhouse effect for small businesses, making it easier for products to enter the market, which would encourage competition.

He also suggests that the authorities work with the entrenched business by creating certain restrictions for it, thus in order to facilitate the entry of small business into the market and to overcome the barrier of dominance.

“There are measures for this: payment deadlines, advertising budget limitations, work with investment attraction, creating preferential conditions for small businesses that would be a step on the heels of big players and prevent them from resting on their laurels,” said A. Vizickas.

According to him, large advertising budgets create a “brain washing” effect, when repeating that something is cheap or sweet creates such an impression on the consumer and then he buys a certain product.

A. Vizick said that the first steps in solving the problem would be simply to pay attention to it. He criticized the current Government for completely ignoring these issues.

“Another thing is business ethics. Showing that we work for consumers is a big deal. But someone has to take care of it”, emphasized A. Vizickas.

He was asked whether it would be worth calling Value Added Tax (VAT) on all food products to 9 or 5 percent. would still keep a part for traders, processors, said that there are two sides of the coin here.

“Before making concessions, we must make sure that they do not end up in the pockets of traders and processors. However, it can be done to prevent this from happening. In Poland, when the VAT was reduced, there was an attempt to take advantage, but their Competition Authority warned that there would be a fine if it happened. And everything is resolved, so it can be fixed. So before we do that, we need to put measures in place to protect consumers so their money isn’t stolen. VAT reduction must have two effects: food affordability and a more competitive region,” A. Vizickas expressed his opinion.

He drew attention to the fact that Lithuanians are currently going to Poland to spend money even on the same Lithuanian products.

“The same meat goes back to Lithuania. We produce here, we earn here, and we go there to spend money,” he stated.