Canada has met the top grocers in the country to help fight rising food prices
Prime Minister Justin Trudeau met with top grocers to find solutions to the rise in food prices. He vowed to cut federal taxes for new rentals. Trudeau is fighting an affordability crisis that is affecting his opinion poll ratings.
Trudeau met with Liberal Party members in London, Ontario. After the meeting, the executives of the five largest grocery chains met in Ottawa. These grocery stores include Loblaw Co., Sobeys, and Metro. These stores represent 80% of the Canadian grocery market. They have to draw up a proposal for October 9th.
Trudeau states that if the grocers cannot provide affordable solutions, the government will take further action, including tax measures. It is unbelievable that Canadian grocery stores are making high profits while the public can barely afford groceries.
In 2022, Loblaw, Sobeys, and Metro recorded a collective sales figure of C$100 billion ($74 billion). They also recorded C$3.6 billion in profits.
Trudeau is under pressure due to the lack of affordable housing in Canada. He said the government will remove the federal 5% tax on new rental apartments. Some builders and developers are not starting new projects because the cost is too high. It will motivate them to construct new apartments.
The left-leaning New Democratic Party supports Trudeau. The election is due in 2025. According to opinion polls, the opposition Conservatives will win the elections. If the elections were now, there would be eight years of Liberal rule in Canada. The Conservatives have accused Trudeau of driving inflation through high government spending.
A competitive market in Canada
Grocery store executives have denied profiting from the rising prices. However, the lack of competition has upset the watchdog sector. They state that competition is necessary to keep the price in check.
The Retail Council of Canada blames producers and manufacturers for passing off products at high prices. Sobeys and Walmart Canada were unable to comment. Metro declined any comments. Loblaw states that the company is open to working on measures benefiting the industry.