Huge Gap in Food, Salaries
 Erika Velasco - The News
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February 15, 2010
| | Pesos buy fewer basic food items; 66% rise in 3 years. | |
Mexico City – Basic food prices in Mexico are practically out of control, the Federal Consumer Protection Agency said Sunday.
In just three years, the cost of primary foods has risen 66.7 percent, indicating a large gap between salary and consumer prices. In 2006, it cost 812.92 pesos to buy 42 items, or 16 days worth of minimum wage, but in 2009, those items cost 1,358 pesos, or 23.6 days of minimum wage.
A person earning minimum wage in December 2006 worked 10.4 hours to buy one kg of steak, 7.41 hours to buy one kg of ground beef and 59 minutes to buy one kg of tortillas. Three years later, a worker would need to spend 13 hours, 9.04 hours and 1.25 hours, respectively, to be able buy those products.
So far during President Felipe Calderón’s administration, workers’ purchasing power has fallen by 41 percent, taking into account the recent 2.6-peso increase in minimum wage as well as increases in public transportation fares, the price of diesel, natural gas, gasoline and electricity, Profeco said.
Minimum wage ranges between 54.47 pesos and 57.46 pesos per day, depending on the area. In 2006, minimum wage was between 45.81 pesos and 48.67 pesos per day.
In rural areas, the prices of products such as corn and wheat flour, milk, soft drinks, crackers, eggs, sugar, beans, rice and soups have risen by as much as 50 percent or more.
Data from the Central Bank of Mexico (Banxico) show that between December 2006 and January 2010, the Consumer Price Index (CPI), or accumulated inflation, has been 14.54 percent; however, the rise of prices of main energy sources is even greater.
The price of Magna (standard) gasoline has risen 19.21 percent, from 6.61 pesos per liter in December 2006 to 7.96 pesos per liter in January, or nearly five points above inflation.
Premium gasoline costs 23 percent more during the same period. Diesel fuel rose 49.7 percent, three times greater than inflation during those three years.
However, the Treasury Secretariat has defended these hikes, arguing that it is necessary for fuel prices to reflect the international market to improve competitiveness in Mexico.
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