Probe on consumer prices will include trucking, freight firms

To come up with a comprehensive analysis on consumer prices in the CNMI, the ongoing investigation being conducted by various government agencies will include trucking companies and freight service providers on the island.

Rep. Melvin Faisao, who initiated the move, said this will help shed light on the different factors dictating the price of consumer goods being sold here, adding the costs of importing these items may have been jacked up.

The move stemmed from a recommendation of the Saipan Chamber of Commerce to widen the scope of the probe, not just on shipping firms, retailers and wholesalers.

According to Faisao, freight charges and fees imposed by trucking firms also contribute to the overall costs of the imported items that are found on local stores and supermarkets.

He said that although the investigation is commendable, the Chamber still believes that consumer prices are dictated by market forces which means that it is part of free market competition.

“I agree that competition is a key factor in determining prices but when they are making the cost of living in the Commonwealth one of the highest in the nation, we must look into these factors to find out if there are discrepancies,” Faisao told in an interview after attending the monthly dialogue between the Legislature and the Chamber.

“I am not saying that legislators must dictate the prices, but I am just out to make sure that fees and charges to bring these goods into the CNMI are reasonable and regulated,” he said.

The representative last week asked the Department of Finance, the Department of Commerce and the Attorney General to inquire into the situation in response to complaints that there has been a wide disparity of consumer prices between the CNMI and Guam.

The three government offices have begun their fact-finding and a report is expected to be released soon. The AG has also suggested that the Commonwealth government should join Guam in pressing the issue on shipping charges to the federal government.

Both islands have alleged that exorbitant fees have been imposed to bring in consumer items from the mainland despite federal regulations making inter-state shipping subject to U.S. control and not based on international rates.

The CNMI’s shipping industry, an off-shoot to the $1 billion-grossing garment manufacturing on Saipan, has contributed widely to reducing the prices of consumer goods on the island as the cost of importing these items has gone down with the continued export of apparel products to the mainland.

Faisao, however, wants a full accounting of how the prices are set in the CNMI, noting that Guam has virtually no export to help lower the costs of products entering into the island for retail or wholesale trade.