On Monday, the Finance and Economy Minister, Bruno Le Maire, launched a three-month anti-inflation drive, in cooperation with most major French supermarket chains. Under the plan, which will cost the companies "several hundred million euros", a selection of products will be made available at the lowest price possible.
The three-month plan will be financed by the supermarkets themselves. The chains have agreed to see their profit margins temporarily reduced by several hundred million euros.
The announcement follows negotiations between the minister and the majority of the biggest supermarket operators. The Leclerc group, France's largest, did not participate in the talks. The scheme will remain in place until the end of June.
The choice of which products will be sold at the lowest price possible will be left to the supermarkets themselves, and will vary from one chain to another.
All will carry a special label in the colours of the French flag, and will bear the logo "Anti-inflation drive".
Most will be chosen from the supermarkets' own-brand' products, over which the companies have the most freedom of action.
Le Maire has also announced a government plan to provide food coupons to the least well-off "over the coming months".
The project will be the subject of an initial test, at regional level, and is intended to allow the most modest households access to fresh, local produce.
Two separate anti-inflation projects
The minister stressed that the two projects are distinct: the food coupons are for the benefit of a specific target population, while the supermarket price deal is intended for all consumers.
At the end of the three month anti-inflation drive, commercial negotiations will be resumed with the major production companies with a view to ensuring that price reductions affecting raw materials are rapidly passed down to consumers.
Several supermarket groups have already launched their own low-price projects, with a view to enlarging their market share by attracting consumers in search of answers to inflation.
Michel-Edouard Leclerc, boss of the French marker leading supermarket chain, says he boycotted the talks because he did not want his company to be used for political purposes. "I didn't wait for a ministerial announcement to offer the lowest prices," he said.
Several consumer protection organisations have criticised the plan, warning that the "lowest price possible" is meaningless without a legal framework defining prices.
Olivier Andrault of the consumer association UFC says there is a danger that the so-called "anti-inflation price" will just be the usual price with a fancy label.
The minister has promised to send out teams of inspectors to ensure that the supermarkets do not make their suppliers carry the financial burden of the price reductions.
Food price inflation was running at 14.5 percent in February, compared to last year, according to the national statistics institute.
