The government of North African energy exporter Algeria will impose price controls on some consumer goods, a minister said.

Draft amendments to Algeria's competition law will widen the government's scope for controlling prices and set tougher penalties for traders who charge over the set price, official media quoted Commerce Minister El Hachemi Djaaboub as saying.

Consumer price inflation in OPEC member Algeria, Africa's fourth-biggest economy, was 5.7 percent last year against 4.4 percent in 2008, according to official figures.

But prices for some food items registered double-digit increases. Falling purchasing power has been a factor in a series of strikes and small-scale clashes with police across the country of 35 million.

Officials blame "speculators" for driving up prices.

Djaaboub had said earlier this month the government was contemplating price controls.

The measures, unveiled by the minister in an interview with the official APS news agency late on Wednesday, include:

* Re-wording the competition law. The law in force now gives the government the right to fix prices on certain strategic items. In the amended draft, the word "strategic will be removed"

* Imposing price controls on between 10 and 15 consumer items. This will be in addition to milk, flour, water, petrol and diesel, which are already subject to price controls. The minister did now say what the new items would be but they could include sugar, cooking oil, and pulses, which have seen sharp price rises.

* Retailers who sell items at above the "fair price" set by the state will be liable to have their license to trade removed or face a fine of up to 10 million Algerian dinars ($137,200).

* The government will help reduce prices by, in some cases, cutting customs tariffs and value added tax.


Reuters