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Letter Of Correspondence

 Robert E. Burwell

 Direct Dial: (858)
523-5408

 Rob.Burwell@lw.com

 12636 High Bluff Drive, Suite 300

 San
Diego, California 92130-2071

 Tel: (858) 523-5400 Fax: (858) 523-5450

 www.lw.com

FIRM / AFFILIATE OFFICES

Boston

New York

Brussels

Northern Virginia

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Orange County

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July 15, 2005

Hong Kong

San Francisco

London

Shanghai

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Silicon Valley

Milan

Singapore

Moscow

Tokyo

New Jersey

Washington, D.C.

VIA EDGAR & FEDEX

File No. 026004-0000

 Mr. H. Christopher Owings

Assistant Director

 Division of Corporation Finance

 Securities and Exchange Commission

 Mail Stop 03-08

 100 F Street, NE

 Washington, DC 20549

Re:
PriceSmart, Inc.

 Registration Statement on Form S-1

 Commission File No. 333-123076

 Filed on March 2, 2005

 Dear Mr. Owings:

 We are in receipt of the Staff’s letter dated March 30, 2005 with
respect to the above-referenced Registration Statement on Form S-1. Per our discussions with the Staff, we are responding to the Staff’s comments on behalf of PriceSmart, Inc. (“PriceSmart”) in connection with
PriceSmart’s filing of its Quarterly Report on Form 10-Q for the quarter ended May 31, 2005 (the “Form 10-Q”). In many cases, our responses to the Staff’s comments reference disclosure in the Form 10-Q. Courtesy
copies of this letter and the Form 10-Q are being submitted to the Staff by FedEx. In addition, as requested by the Staff, we will submit an additional response letter in connection with the filing of Amendment No. 1 to the Registration Statement on
Form S-1 (the “Amendment”) cross referencing our responses to the Staff’s comments to the Amendment.

 PriceSmart’s responses set forth in this letter are numbered to correspond to the numbered comments in the Staff’s letter. For ease of
reference, we have set forth the Staff’s comments and PriceSmart’s response for each item below.

 Mr. H. Christopher Owings

 July 15, 2005

  Page
 2

 Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations, [page 14]

 General

1.
Where you identify intermediate causes of changes in your operating results, also describe the reasons underlying the intermediate causes. For example, you indicate that the
increase in net warehouse club sales from the first quarter 2004 to the first quarter 2005 is primarily due to improvements in merchandising. Please explain the merchandising improvements you implemented and why these improvements led to higher
average sale per transaction figures. As another example, where you discuss the fluctuations in your “losses of unconsolidated affiliates” line item, you indicate that the fluctuations are a result of fluctuations in underlying
earnings/losses of your equity method investees. Please revise to explain the reasons for the fluctuations in the earnings/losses of your equity method investees. See SEC Release No. 33-8350.

 Confidential Response? No

 The Company has revised its disclosure in accordance with the Staff’s
comment.

 With respect to increases in net warehouse sales, the
Company has revised its disclosure as follows: “Improvements in merchandising in the Company’s warehouse clubs, such as higher quality imported products, larger pack sizes and increases in inventory levels for key items to assure product
availability, was the primary contributor to the growth in sales for those clubs that were open during both periods. In addition, sales were positively impacted by a strong general economic environment in the Company’s Central American and
Caribbean markets, particularly in the Dominican Republic which is included in the Caribbean region.”

 Regarding “Losses of unconsolidated affiliate,” the circumstances have changed since the initial filing of the Registration Statement due to the
closure of the warehouse clubs. The Company’s revised disclosure is as follows: “Losses of unconsolidated affiliate represent the Company’s 50% share of losses from its Mexico joint venture. On February 11, 2005, the Company, along
with its joint venture shareholder, Grupo Gigante S.A. de C.V., announced that it was closing the warehouse operations of PSMT Mexico, S.A. de C.V. effective February 28, 2005. At that time the Company indicated that it believed that the closure
would not result in a significant loss for PriceSmart, Inc. While this is still the Company’s view with respect to the total carrying value of that investment, PSMT Mexico continues to incur operating losses during this period of merchandise
and asset liquidation and the settlement of contractual obligations. Under the equity method of accounting, through which the Company reflects its proportionate share of income or loss of the unconsolidated joint venture’s results from
operations, the Company’s proportionate share of the loss in PriceSmart Mexico for the current quarter was $617,000, as compared to $565,000 in the prior year period.”

 Please see pages 2, 5, 6 and 9 of the Form 10-Q.

 Mr. H. Christopher Owings

 July 15, 2005

  Page
 3

2.
Where you describe two or more business reasons that contributed to a material change in a financial statement line item between periods, please quantify the extent to which each
change contributed to the overall change in that line item. For example, with respect to the change in your warehouse club operating expenses from the first quarter 2004 to the first quarter 2005, please quantify the extent to which the changes are
attributable to the various contributing factors. See Item 303(a) of Regulation S-K and SEC Release No. 33-8350.

 Confidential Response? No

 PriceSmart has revised its disclosure in response to the Staff’s comment as follows:

 Warehouse club operating expenses increased to $21.4 million in the third quarter of fiscal 2005 from $19.8
million in the third quarter of fiscal 2004, but decreased as a percent of net warehouse sales to 12.9% from 13.9%. The impact of one additional club in operation in the period compared to the same period last year was $715,000. The remaining
increase was due to legal costs incurred by the Guatemala and the Philippines entities of approximately $310,000 related to disputes with minority shareholders, and generally higher operating costs in the warehouse clubs of approximately $531,000.

 Please see page 4 of the Form 10-Q.

3.
We note your disclosure that comparable warehouse club sales include sales for those warehouse clubs open at least 12 full months. Does this mean that a store open for one month
in the prior period and 11 months in the current period is included in comparable warehouse club sales? If so, please tell us why you believe this measure represents your “comparable” warehouse club sales. Also revise your disclosure to
clarify that the measure could be skewed by stores only open a short period of time in the prior period. Also disclose whether there have been any revisions to your methodology for calculating comparable warehouse club sales in the last three years.
Finally, please expand your disclosure of how you calculate the change in comparable store sales from period to period to include how you treat stores that were closed during the period.

 Confidential Response? No

 Closed warehouses are not included in the comparable warehouse sales
calculations, and the only adjustment the Company has made to the methodology was to account for the leap year in February 2004.

 PriceSmart has revised its disclosure in response to the Staff’s comment as follows:

 The Company reports comparable warehouse sales on a “same week” basis with 13 weeks in each
quarter beginning on a Monday and ending on a Sunday. The periods are established at the beginning of the fiscal year to provide as close a match as possible to the calendar month

 Mr. H. Christopher Owings

 July 15, 2005

  Page
 4

 that is used for financial reporting purposes. This approach equalizes the number of weekend days and
week days in each period for improved sales comparison, as the Company experiences higher warehouse sales on the weekends. Further, each of the warehouse clubs used in the calculation was open for at least 13 1/2 calendar months before its results for the current period were compared with its results for the prior period. For
example, if a warehouse club opened during the fourth fiscal quarter on June 14, 2004, it would not be included in the comparable warehouse club sales until the first comparison of July 2005 with July 2004. For purposes of quarterly comparisons of
comparable warehouse club sales, July and August 2005 results for this hypothetical warehouse club would be compared to July and August 2004 for the fourth quarter comparable sales. June 2005 results would not be taken into account in making the
comparison. By contrast, a warehouse club opened June 16, 2004 would not be included in comparable warehouse club sales until the first comparison of August 2005 with August 2004.

 Please see pages 2 and 6 of the Form 10-Q.

4.
Please tell us why your comparable warehouse club sales data on page 17 uses a cut-off date of September 5, 2004 and covers a 53-week period while the comparative data for the
prior year uses a cut-off date of August 31, 2003, your fiscal year-end, and a 52-week period.

 Confidential Response? No

 Comparable warehouse sales use a 4-4-5 “fiscal week” period adding to a 13 week quarter, but the Company’s financial reporting period is on
a calendar month basis. The Company attempts to align those two measurement periods as closely as possible, and depending on the calendar, the periods may have the same ending date (as was the case on August 31, 2003). However, this is not always
the case. Every four years, there is a need to have a 14 week quarter (53 week year) to maintain that close alignment, due to the leap year. Please also see the Company’s response to Staff Comment No. 3, above.

 Comparison of First Quarter 2005 to First Quarter 2004,
[page 15]

5.
You disclose on page 16 that other income, excluding licensee fees, decreased to $1.1 million in the first quarter of fiscal 2005 from $1.6 million in the first quarter of fiscal
2004. It appears, however, that both of these amounts include licensee fee income. Please revise or advise.

 Confidential Response? No

 The Company has revised its disclosure in response to the Staff’s comment as follows:

 Other income consists of commission revenue, rental income, advertising revenue, construction revenue, fees
for in-store product

 Mr. H. Christopher Owings

 July 15, 2005

  Page
 5

 demonstrations, and fees earned from licensees. Other income in the third quarter of fiscal 2005 was
$1.0 million, a reduction of $425,000 from the prior year. A significant component of this reduction was a decrease of $283,000 in license fees in the third quarter of fiscal 2005, compared to the third quarter of fiscal 2004, primarily as a result
of the previously announced termination of the technology and trademark licensing agreements with the Company’s China licensee.

 Please see pages 4 and 7 of the Form 10-Q.

6.
Your presentation on page 15 of your warehouse gross margin excluding the impact of foreign exchange gains and losses represents a non-GAAP measure subject to the disclosure and
reconciliation requirements in Item 10(e) of Regulation S-K. Please consider revising your discussion so that you quantify and discuss the impact of foreign exchange gains and losses on your gross margin without presenting your gross margin
excluding the impact of such charges. Otherwise, if you intend to retain this non-GAAP measure in your filing, please note that you must meet the burden of demonstrating the usefulness of this and any other non-GAAP measure which excludes recurring
type items. In this regard, you will need to disclose the following information in your filing:

•

The manner in which you use the non-GAAP measure to conduct or evaluate your business;

•

The economic substance behind your decision to use such a measure;

•

The material limitations associated with use of the non-GAAP financial measure as compared to the use of the most directly comparable GAAP financial measure;

•

The substantive reasons why you believe the non-GAAP financial measure provides useful information to investors.

 In addition to the above guidance, please ensure that you provide a
reconciliation, preferably in tabular form, which reconciles the non-GAAP measure to your gross margin as calculated in accordance with GAAP. For further guidance, see Item 10(e) of Regulation S-K and questions 8 and 9 of the Staff’s Frequently
Asked Questions Regarding the Use of Non-GAAP Financial Measures, available at www.sec.gov.

 Confidential Response? No

 The Company has revised its disclosure to eliminate the use of non-GAAP measures.

 Liquidity and Capital Resources, [page 21]

7.
You indicate on page 14 that you plan to open a warehouse club in Costa Rica during the second half of calendar year 2005 and disclose on page 15 that you terminated the license
agreement with your China licensee subsequent to the end of the first fiscal quarter of 2005. You also state on page 31 that you completed the closure of your PSMT Mexico, S.A. de C.V. warehouse club operations during the fiscal year 2005. If
material, please quantify the estimated impact on your future results of operations and cash flows of each of these items.

 Mr. H. Christopher Owings

 July 15, 2005

  Page
 6

 Confidential Response? No

 The Company is currently operating 26 warehouse clubs. The opening of one additional warehouse club would not have a
material impact on earnings in the near term.

 The
Company’s revised disclosure with respect to Costa Rica is as follows:

 Net cash (used in) provided by investing activities was $(7.1) million and $1.6 million in the first nine months of fiscal 2005 and 2004, respectively. The increase in the use of cash resulted primarily from the
acquisition of land and the initial building costs associated with the planned new warehouse club location in San Jose, Costa Rica. Through May 31, 2005, approximately $4.2 million has been invested in the new location, which is expected to cost
approximately $10.2 million.

 Please see page 10 of the Form
10-Q.

 The Company’s revised disclosure with respect to
China is as follows:

 Other income consists of
commission revenue, rental income, advertising revenue, construction revenue, fees for in-store product demonstrations, and fees earned from licensees. Other income in the first nine months of fiscal 2005 was $3.7 million, a reduction of $1.0
million from the prior year. This reduction primarily results from a decrease of $1.0 million in license fees in the first nine months of fiscal 2005, as a result of the previously announced termination of the technology and trademark licensing
agreements with the Company’s China licensee. No further revenue for the China license has been recorded after May 31, 2004.

 Please see pages 4 and 7 of the Form 10-Q.

 With respect to PSMT Mexico, please see the Company’s response to Staff Comment No. 1.

 Contractual Obligations, [page 26]

8.
Please revise your tabular disclosure of contractual obligations to include estimated interest payments on your debt. Since the table is aimed at increasing transparency of cash
flow, we believe these payments should be included in the table. A footnote to the table should provide appropriate disclosure regarding how you estimated the interest payments. If you choose not to include these payments, a footnote to the table
should clearly identify the excluded item and provide any additional information that is material to an understanding of your cash requirements. See Item 303(a)(5) of Regulation S-K and footnote 46 to SEC Release No. 33-8350.

 Mr. H. Christopher Owings

 July 15, 2005

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 7

 Confidential Response? No

 The Company has revised its disclosure in response to the Staff