Slovaks mourn after good-old butter following EU membership

Before Slovakia's accession to the European Union many worried that the cheap and skilled labour force will be the first item to emigrate to the EU. Well, surprise, surprise, the mundane subject of butter has proved to be the front runner.

"What happened is that for a short period of time butter disappeared from Slovak shops. And this is because local producers had decided to sell it in other countries than Slovakia."

Gejza Blaas, a food processing industry analyst, says this is a normal adjustment process. Sources close to Sole, one of the largest Slovak butter producers have pointed to the fact that the company can sell butter abroad for a price up to 40% higher than on the local market. Italy is the main destination for the Slovak butter due to the increased demand that cannot be satisfied by local producers who need to respect the quotas imposed by the EU's common agricultural policy. Slovak Customers have their own explanations.

"In my opinion this is a fake crisis. It was just a conflict between producers and the retail chains that were fighting over the prices."

"I heard that the producers were not happy with the low prices that hypermarkets offered them."

"I have the feeling that this is the first consequence of our country's membership of the European Union. Our products go west and we have to pay Western prices if we want to have them on local shelves."

Customers are very well informed. Indeed producers have complained that supermarkets tried to put pressure on them to lower the price. But representatives of the retail chains say they have to compensate for the increased new VAT flat tax of 19% that came into effect in January this year. When Slovak butter returned to the shelves it was a third more expensive. This fact triggered a political debate with opposition parties, lead by the populist SMER, asking for a reduction of VAT to only 10% for foodstuffs. But with the Ministry of Finance regarding the current flat rate of VAT as the key factor of fiscal reform, such an initiative hardly has any chance of success. Many Slovaks will replace butter with vegetable margarine which is cheaper and some say even healthier.