Inflation rate may reach 40% with regard to living wage basket in late 2008

The due announcement was made by Oqtay Ahverdiyev, leading economist of Azerbaijan and honored state official, according to Novosti-Azerbaijan.

He also considers the current rise in price on bread and flour in the capital city and in regions of Azerbaijan as a natural and inevitable process due to the processes ongoing in the world conjuncture.

Taking into account the 1.5 times rise in grain prices, logically, they will rise in any country and Azerbaijan is not an exception. Paradoxally, prices on bread are rising in the countries, which are able to supply themselves with grain.

According to the statistics, Azerbaijan annually imports nearly 600,000-700,000 tons of grain and the factor of rise of grain cost price is quite real. On the whole, the country's demand for bread nears 3,000,000  tons of grain per year. Thus, Azerbaijan produces over 2,000,000 tons of grain, with wheat making up 1,200,000 tons.

At the same time, the remaining part of the standard volume of grain is imported for meeting the needs of the country.

Active process of talks on supply of grain is going on with Kazakhstan and grain import from Russia and Ukraine is not ruled out.

Dependence of rise in bread prices on harvest is an important factor. The rise in prices on flour may reach 30% within a year.

According to experts, in order to prevent the expected rise in prices on essential goods, it is necessary to apply strict economic methods, ruling out the administrative ones.

Ahverdiyev implies senseless freezing of prices, which may have a negative impact while unfreezing, as it occurred in Russia.

It is necessary to fill the market with foodstuffs to liberalize it.

The suspension of inertia growth of prices will become possible if stiff governmental program on market liberalization is applied.

Nevertheless, he considers that the deficit of bread and essential goods is not expected even in inflation rises up to 20% this year.