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Dutch retailer SPAR to enter Israeli market amid soaring living costs
Global Banking & Finance Review®
Company
By Steven Scheer
JERUSALEM (Reuters) – Israeli businessman Amit Zeev said he has signed a preliminary deal to bring Dutch food retail chain SPAR to Israel, a move that would create more competition and potentially lower food costs that have soared in recent months.
Zeev was most recently chief executive of Yeinot Bitan, one of Israel’s largest supermarket chains. He said he signed a letter of intent with SPAR and aims to bring in more global products “at a more affordable price point than is currently available in Israel”.
Later this year, French retailer Carrefour is expected to enter the Israeli market. Under a deal made in March, 150 of Yeinot Bitan’s branches will be converted to Carrefour.
Zeev is in the process of a similar plan and is speaking with existing supermarket chains to convert them to SPAR, which has 13,600 stores in 48 countries.
Cost of living is expected to take centre stage in Israel’s general election on Nov. 1. Annual inflation is 4.4%, far lower than most other Western countries, but Israelis have seen prices of most basic goods jump, while the Bank of Israel is raising interest rates aggressively to battle price pressures.
The government has won a minor victory by convincing retailers to delay a planned 20% hike of supervised bread prices.
Yair Lapid, the prime minister in Israel’s caretaker government, told cabinet ministers on Sunday that rising living costs are a “national scourge and we are determined to deal with it.”
“It cannot be there will be a wealthy country here with people who cannot finish the month,” he said.
Lapid added that he expects Carrefour’s entry to bring big discounts. “We expect other major companies to follow in its wake,” he said.
“From here I say to all the players in the market: Whoever raises prices irresponsibly is liable to get up in the morning and find themselves with unexpected competition. This government believes in competition and opening markets and it will not hesitate to act.”
(Reporting by Steven Scheer; editing by David Evans)
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is often measured by the Consumer Price Index (CPI).
A retailer is a business or individual that sells goods or services directly to consumers. Retailers can operate in physical stores or online.
Basic goods are essential items that consumers need for everyday living, such as food, clothing, and shelter. Their prices are often closely monitored in economic analyses.
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