Is Vietnam a non-market economy?
The Ministry of Finance has issued a decision imposing price ceilings on 25 powdered milk products for children under six years old. The decision, issued May 20, will be effective 10 days later, on June 1 and must be applied no later than 10 days to wholesale products and no later than 20 days to retail products.
The decision requires that the ceilings of retail prices are determined by adding costs to the highest wholesale prices in line with guidance of price control agencies but will not be 15% higher than the wholesale price ceilings.
The ministry requires milk traders to refer to the price ceilings and related regulations on price control to determine prices of other milk products and new products on the domestic market, and then report their retail prices to authorities for approval.
The decision is expected to hit the country’s five largest milk producers and traders, including Mead Johnson Nutrition Viet Nam Ltd Co, Viet Nam Dairy Joint Stock Company (Vinamilk), Nestle Viet Nam Co Ltd, Friesland Campina Viet Nam Co Ltd and 3A Nutrition Viet Nam Co Ltd.
A representative of the ministry said companies and traders would set their retail prices on the basis of ceiling prices and the ministry’s pricing methods, and send them to the ministry’s price administration division.
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