Armenia expecting disastrous price hike

/AzerNews/

By Mushvig Mehdiyev

Economic crisis in Armenia can gain a new momentum due to an upcoming price hike, which is expected after the official membership of the country at the Eurasian Economic Union.

Armenia will fully integrate into the Russia-led EEU on January 1 next year and subsequently will apply the common customs duties of the union. The customs will increase the prices of several goods on the markets, according to economic experts.

Public organization Union of Knowledgeable Citizens has prepared a list of 70 goods out of 7,000, prices of which are expected to rise.

The organization says the prices of frozen meat of bovine animals will rise by 5 percent, while the prices of pork will jump by 55 percent along with 15 percent increase in the prices of poultry and other meat products.

Meanwhile, the prices of dairy spreads are expected to grow by 12.5 percent, as the egg price will rise by 5 percent.

Prices of the daily consumer products including tomato, potato, onion, garlic and etc. are predicted to increase by 15 percent.

The list comprises mostly foodstuffs and daily consumer products, which are extremely essential for human body in terms of the daily food intake. Price hike in those kinds of products will hit the Armenians, pushing them into a deeper starvation.

Well-nourished people are those, who take the minimum daily intake of 2,232 calories per day based on the internationally recognized norm. If the figure reflecting the daily calorie intake is below the average international norm, it is directly accepted as an obvious hunger.

About 42 percent of Armenia's population are malnourished, while some 32 percent live in poverty, according to the Sociometer Sociological Center. The average daily nutrition intake in Armenia is 6 percent or 142 calories, proving the statistical figures validity.

The price hike in the post-Soviet country will not be limited to food products, economic experts say. Prices of the bottles, garments, soap and hair care products, as well as the alcoholic and energetic beverages are also expected to rise by 8 percent. Even toilet paper will be reportedly hit by price increase.

It seems that the EEU membership will force Armenians to brace themselves for a narrow and difficult life, since the hike in toilet paper's price will make them look for alternative WC options.

One more bad news about price hike may cause a great panic among Armenians and add fuel to social disagreement in the country. Prices of the gas imported from Russia can rise in the upcoming year, despite an agreement to keep prices unchanged for the next five years.

Local media reported that Armenia's Energy and Natural Resources Ministry is considering the probability of a hike in gas prices. "According to an agreement with the Russian Gazprom company, the prices for gas in Armenia should be kept stable for the next five years. Nonetheless, an additional clause in the agreement envisages a possible increase in the price," local Haykanak Zhamanak paper wrote.

The paper claims that the price hike in the mentioned clause is connected with the growing domestic prices in Russian markets. It means that if the prices in Russia increase, the tariffs for the gas imported from Russia to Armenia will also rise. The northern giant is currently facing huge financial losses in oil and gas industry amid the sharp fall in the oil price.

"The Energy and Natural Resources Ministry expects the Russian authorities to partially compensate those financial losses through increasing the domestic prices for gas. Change of gas tariff in Armenia could happen in next spring pursuant to a supposed price hike in Russia," the paper said.

Dependent economy continues to cause headaches to Armenia. The EEU membership's other face is an increasing dependence on foreign factors. The small Caucasus country is on the way of going back to the middle ages, when politically and economically weak countries were serfdom, being in a condition of universal bondage.