Identifier
Created
Classification
Origin
08ASHGABAT1063
2008-08-15 04:02:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ashgabat
Cable title:
TURKMENISTAN FOOD MARKET - IMPACT OF UNIFIED CURRENCY
how-toVZCZCXRO1312 PP RUEHAG RUEHAST RUEHBI RUEHCI RUEHDF RUEHIK RUEHLH RUEHLN RUEHLZ RUEHPW RUEHROV RUEHVK RUEHYG DE RUEHAH #1063 2280402 ZNR UUUUU ZZH P 150402Z AUG 08 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC PRIORITY 1350 INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY RUCNCIS/CIS COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEHAK/AMEMBASSY ANKARA PRIORITY 4156 RUEHBJ/AMEMBASSY BEIJING PRIORITY 1968 RUEHKO/AMEMBASSY TOKYO PRIORITY 1833 RUEHIT/AMCONSUL ISTANBUL PRIORITY 2404 RUEKJCS/JOINT STAFF WASHDC PRIORITY RHMFIUU/CDR USCENTCOM MACDILL AFB FL PRIORITY RUEKJCS/SECDEF WASHDC PRIORITY RUEAIIA/CIA WASHDC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RHEFDIA/DIA WASHDC PRIORITY RUEHRC/DEPT OF AGRICULTURE WASHDC PRIORITY RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
UNCLAS ASHGABAT 001063
SENSITIVE
SIPDIS
STATE FOR SCA/CEN
ANKARA FOR AGRICULTURAL COUNSELLOR
E.O. 12958: N/A
TAGS: EAGR ECON ETRD PGOV TX
SUBJECT: TURKMENISTAN FOOD MARKET - IMPACT OF UNIFIED CURRENCY
EXCHANGE ON FOOD PRICES
UNCLAS ASHGABAT 001063
SENSITIVE
SIPDIS
STATE FOR SCA/CEN
ANKARA FOR AGRICULTURAL COUNSELLOR
E.O. 12958: N/A
TAGS: EAGR ECON ETRD PGOV TX
SUBJECT: TURKMENISTAN FOOD MARKET - IMPACT OF UNIFIED CURRENCY
EXCHANGE ON FOOD PRICES
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) Three months after the unification of the government's
dual currency exchange rates, prices for imported food items,
including cooking oil, sugar and butter decreased 10 percent on
average, returning to December 2007 price levels. At the same time,
although prices for local food items remained steadily high since
January, some of them, including rice and chicken, have continued to
increase -- probably due to rising production costs. The increased
price for rice reflected higher fees for land rent, irrigation
water, fertilizers and transportation. Poultry producers raised
their prices due to the increased cost of poultry feed and
transportation services.
Food Item 08/08 05/08 % change
TMM TMM
Bread
(1 homemade) 8,000 8,000 0
Flour (1 kg) 16,000 16,000 0
Rice (1 kg) 35,000 28,000 25
Butter (1 kg) 120,000 130,000 -8
Veg. Oil (1 lit) 45,000 50,000 -10
Sugar (1 kg) 16,000 18,000 -12
Beef (1 kg) 70,000 70,000 0
Lamb (1 kg) 60,000 60,000 0
Chicken (1 kg) 60,000 55,000 9
Milk (1 lit) 15,000 15,000 0
Cheese (1 kg) 150,000 150,000 0
Eggs (ten) 25,000 25,000 0
3. (SBU) While the higher value of the manat against the dollar may
have contributed to price decreases for imported food items, these
drops could also be the result of the government's August 1 decision
to lower import tariffs for all consumer goods except cars. The
need for the revision was caused by the tripling of import taxes
after the manat exchange rate was unified at 14,250 manat/USD.
(Note: Prior to exchange rate unification, import taxes paid in
manat were calculated at the official rate of 5,300 manat/USD. END
NOTE.)
5. (SBU) COMMENT: The government was well aware of popular
discontent with food price inflation in the first six months of
2008. With its attempts to control rising prices through price
controls proving unsuccessful, it seems to be focusing now on
keeping prices low by decreasing tariffs and by increasing the
supply of imported goods -- occasionally at subsidized prices -- in
the market. While these measures appear to be working for now, many
remain skeptical that they can work in the long term.
CURRAN
SENSITIVE
SIPDIS
STATE FOR SCA/CEN
ANKARA FOR AGRICULTURAL COUNSELLOR
E.O. 12958: N/A
TAGS: EAGR ECON ETRD PGOV TX
SUBJECT: TURKMENISTAN FOOD MARKET - IMPACT OF UNIFIED CURRENCY
EXCHANGE ON FOOD PRICES
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) Three months after the unification of the government's
dual currency exchange rates, prices for imported food items,
including cooking oil, sugar and butter decreased 10 percent on
average, returning to December 2007 price levels. At the same time,
although prices for local food items remained steadily high since
January, some of them, including rice and chicken, have continued to
increase -- probably due to rising production costs. The increased
price for rice reflected higher fees for land rent, irrigation
water, fertilizers and transportation. Poultry producers raised
their prices due to the increased cost of poultry feed and
transportation services.
Food Item 08/08 05/08 % change
TMM TMM
Bread
(1 homemade) 8,000 8,000 0
Flour (1 kg) 16,000 16,000 0
Rice (1 kg) 35,000 28,000 25
Butter (1 kg) 120,000 130,000 -8
Veg. Oil (1 lit) 45,000 50,000 -10
Sugar (1 kg) 16,000 18,000 -12
Beef (1 kg) 70,000 70,000 0
Lamb (1 kg) 60,000 60,000 0
Chicken (1 kg) 60,000 55,000 9
Milk (1 lit) 15,000 15,000 0
Cheese (1 kg) 150,000 150,000 0
Eggs (ten) 25,000 25,000 0
3. (SBU) While the higher value of the manat against the dollar may
have contributed to price decreases for imported food items, these
drops could also be the result of the government's August 1 decision
to lower import tariffs for all consumer goods except cars. The
need for the revision was caused by the tripling of import taxes
after the manat exchange rate was unified at 14,250 manat/USD.
(Note: Prior to exchange rate unification, import taxes paid in
manat were calculated at the official rate of 5,300 manat/USD. END
NOTE.)
5. (SBU) COMMENT: The government was well aware of popular
discontent with food price inflation in the first six months of
2008. With its attempts to control rising prices through price
controls proving unsuccessful, it seems to be focusing now on
keeping prices low by decreasing tariffs and by increasing the
supply of imported goods -- occasionally at subsidized prices -- in
the market. While these measures appear to be working for now, many
remain skeptical that they can work in the long term.
CURRAN