Aaron in Azerbaijan

Just another blog about Azerbaijan.

Azerbaijan’s Consumer Prices Are Flapping Wildly, Ctd.

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In an addendum to this previous post about consumer prices, specifically regarding eggs and fowl, we get this story from RFE/RL:

As food prices spike in Azerbaijan, many are doing their grocery shopping abroad.

One woman who was waiting to cross the border explained to RFE/RL’s Azerbaijani Service that her pension does not provide enough money for her to buy food in her own country.

“Why shouldn’t I go to Iran? We buy everything we need there — meat, butter,” she said. “These products are very expensive in our country. We cannot afford to buy these things here on our tiny pensions.”

Food prices in Azerbaijan have, indeed, skyrocketed in recent months. According to official figures, overall prices have gone up by 2.2 percent in February alone. The price of sugar has risen by 9.5 percent and the price of potatoes by 12.5 percent. Independent analysts say the increases are even larger.

Vuqar Bayramov, a Baku-based economist, said he expects overall food prices to rise by 16 percent over the course of 2011.

As we saw before, however, the government is moving to have stricter control of the market, pushing to lower the prices of eggs and chickens.  Interestingly, this presents one of two possibilities: Either (A) the government is pushing down prices and firms will lose profits and lose their businesses as the government artificially dictates inefficient prices of goods or (B) the government is allowing monopoly power and corrupt officials to skew the market mechanism, resulting in inflated prices that can be artificially set as the government and monopolists work together to manipulate the market.  RFE/RL charges that it’s the latter situation.

In any case, the spiked prices are leading to situations like this just south of my region in Astara, at the Iranian border:

At the border to Iran, however, Azerbaijanis are simply worried about feeding their families.

“We are in bad condition,” said one man, gesturing toward Iranian territory in frustration. “It’s expensive here; it’s cheaper there.”

Lastly, there’s a video here showing the situation at the border of Azerbaijan and Iran in Astara, where over 3,000 Azerbaijanis attempt to go through the border every day.  I just can’t seem to get the RFE/RL player to embed itself here in the post, so you’ll have to click the link to see it.

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Written by Aaron

March 15, 2011 at 6:23 pm

Posted in Uncategorized

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