His official title is «Price Supervisor», but Stefan Meierhans is better known as «Mr. Price». Since 2008, this senior civil servant has been in the head of the Swiss federal office in charge of ensuring fair prices, particularly in areas where competition is not effective, such as water or gas supply.
The Omicron variant has disrupted supply chains, which is fuelling inflation. What is the impact of the recent surge in commodity prices on the Swiss consumer?
Of course, this surge is having a knock-on effect on the consumer in Switzerland. With a certain time lag, prices are rising here too. But since this impact is global, it has not impacted the competitiveness of our export industry. If there is a price increase here at home, there is obviously a price increase in New Zealand, on the other side of the world too.
Have you seen any impact higher than the increase in raw material prices around the world?
We are monitoring the market and, especially regarding gas prices, we are now investigating on several fronts. But it is still too early to get an answer. All I can say is that for the moment the outcome is not negative. When I check the prices, I look for any exaggeration and I make sure that the increase matches that of the international markets. We have no choice but to accept these variations.
The essential question to ask is whether competition is effective
But it is also important to know that the price of electricity, or gas for that matter, partly depends on the import market. That is because only one third of the price accounts for the energy itself, two thirds are for the grid.
What should we carefully pay attention to when a surge in commodity prices occurs?
The essential question is whether competition is effective. In Switzerland, for most markets, imports and exports are free. Competition exists within and outside our country. In the French-speaking part of Switzerland, many people shop in neighboring countries, which means that the market is free and therefore allows everyone to make their own decision. When competition is weak, there is a temptation to raise prices more than the international increase. But when it is strong, there is a reluctance to do so. There is even an inclination to give up part of the margin in order to keep the current market share.
What have you observed that is specific to the health crisis?
The evolution of prices for masks and disinfectant gels was a textbook case. It turned out that it is dangerous for a state to set a maximum selling price for a good that is in short supply. Although the market has not yet fully recovered, masks are selling at reasonable prices today. The global market has adapted quickly to this situation.
You seem to be optimistic...
I am very confident, because I think that «capitalism» has proven itself. The system is not perfect, but it has the fewest flaws. The update of the Cartel Act and the unfair competition Act regarding geo-blocking came into force on the first of January this year. We have taken an important step in the right direction to tackle this so-called “island of high cost” that Switzerland has been representing for a very long time.
