Identifier
Created
Classification
Origin
09ASHGABAT519
2009-04-23 12:04:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ashgabat
Cable title:
TURKMENISTAN: PRICE CONTROLS ON FOOD REMAIN IN PLACE;
how-toVZCZCXRO7277 PP RUEHAG RUEHAST RUEHBI RUEHCI RUEHDBU RUEHDF RUEHIK RUEHLH RUEHLN RUEHLZ RUEHNEH RUEHPW RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG DE RUEHAH #0519 1131204 ZNR UUUUU ZZH P 231204Z APR 09 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC PRIORITY 2706 INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY RUCNCIS/CIS COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEHAK/AMEMBASSY ANKARA PRIORITY 5122 RUEHBJ/AMEMBASSY BEIJING PRIORITY 2872 RUEHKO/AMEMBASSY TOKYO PRIORITY 2737 RUEHIT/AMCONSUL ISTANBUL PRIORITY 3366 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 000519
SENSITIVE
SIPDIS
STATE FOR SCA/CEN
ANKARA FOR AGRICULTURAL COUNSELLOR
E.O. 12958: N/A
TAGS: EAGR ECON ETRD PGOV SOCI TX
SUBJECT: TURKMENISTAN: PRICE CONTROLS ON FOOD REMAIN IN PLACE;
GOVERNMENT LOANS STIMULATE POULTRY PRODUCTION
UNCLAS ASHGABAT 000519
SENSITIVE
SIPDIS
STATE FOR SCA/CEN
ANKARA FOR AGRICULTURAL COUNSELLOR
E.O. 12958: N/A
TAGS: EAGR ECON ETRD PGOV SOCI TX
SUBJECT: TURKMENISTAN: PRICE CONTROLS ON FOOD REMAIN IN PLACE;
GOVERNMENT LOANS STIMULATE POULTRY PRODUCTION
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) SUMMARY: A recent price check in local markets revealed
that, compared with December 2008, posted prices reflected a 26
percent average decrease for basic imported food items, and a 17
percent average decrease for locally produced food. Despite the
posted prices, food items were actually being sold at prices that
were ten percent higher than the Government imposed price caps. END
SUMMARY.
3. (SBU) A recent price check in local markets revealed that
compared to December 2008, posted prices for imported food items,
including butter, vegetable oil, sugar, and flour, showed a 26
percent average decrease and prices for locally supplied food items,
including meat and chicken, showed a 17 percent average decrease due
to the mid-March introduction of the Government's price caps. A
food vendor at the Russian Bazaar in Ashgabat told local Pol/Econ
staff that the bazaar's administration requires posted prices to
reflect the Government's price caps. However, food vendors were
selling their products at individually negotiated prices, which were
11 to 15 percent higher that posted prices. For example, while the
posted price for a kilo of lamb was 39,000 manat ($2.74),a meat
vendor offered it for a 45,000 manat ($3.16). A whole chicken at a
posted price of 40,000 manat ($2.81) was offered for 45,000 manat
($3.16) per kilo. A kilo of beef was offered for 50,000 manat
($3.52) per kilo against the posted price of 45,000 manat per kilo
($3.16). (NOTE: The current exchange rate is USD/14,215 old
Turkmen Manat or 2.84 new Turkmen Denominated Manat. For
convenience, food vendors at the bazaar still post their prices in
old Turkmen Manat. Only state shops post prices in new Turkmen
Denominated Manat. END NOTE.) Local people have a common
understanding that if they demand that vendors sell at the
Government imposed prices, they will get poor quality products or be
cheated on the scale.
4. (SBU) The Government introduced the recent cap on food prices in
the middle of March after the President demanded lower food prices
for the population. Since 2005 the Government has periodically
imposed price controls on food by enforcing price caps for certain
food items. These have included meat, the price of which has
steadily increased due to the increased cost of inputs, and chicken
and eggs, prices for which were always high due to their short
supply. The Government continues to buy low quality "buffalo meat"
from India and American chicken legs ("Bush legs") to offer
alternative meat at affordable prices to Turkmenistan's low-income
population. The price of "buffalo meat" is 40,000 manat/kilo; a
kilo of "Bush legs" is offered for 34,000 manat.
5. (SBU) President Berdimuhamedov appears to have a better
understanding of the market economy than his predecessor and has not
relied exclusively on price controls to address the issue of food
prices. In March, 2008 he offered a favorable loan program to
support domestic poultry production. The program started in June of
2008, and currently, the local market is self-sufficient in locally
supplied chicken and eggs. In 2007, the price of chicken was 60,000
manat/kilo and eggs 30,000 manat per ten eggs. The current price is
45,000 manat and 15,000 manat, respectively.
6. (SBU) COMMENT: The Government's program to support domestic
poultry producers in order to meet local demand for poultry products
and lower their prices proved to be successful. In order to lower
meat prices, the Government needs to offer a comparable program for
livestock producers. END COMMENT.
MILES
SENSITIVE
SIPDIS
STATE FOR SCA/CEN
ANKARA FOR AGRICULTURAL COUNSELLOR
E.O. 12958: N/A
TAGS: EAGR ECON ETRD PGOV SOCI TX
SUBJECT: TURKMENISTAN: PRICE CONTROLS ON FOOD REMAIN IN PLACE;
GOVERNMENT LOANS STIMULATE POULTRY PRODUCTION
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) SUMMARY: A recent price check in local markets revealed
that, compared with December 2008, posted prices reflected a 26
percent average decrease for basic imported food items, and a 17
percent average decrease for locally produced food. Despite the
posted prices, food items were actually being sold at prices that
were ten percent higher than the Government imposed price caps. END
SUMMARY.
3. (SBU) A recent price check in local markets revealed that
compared to December 2008, posted prices for imported food items,
including butter, vegetable oil, sugar, and flour, showed a 26
percent average decrease and prices for locally supplied food items,
including meat and chicken, showed a 17 percent average decrease due
to the mid-March introduction of the Government's price caps. A
food vendor at the Russian Bazaar in Ashgabat told local Pol/Econ
staff that the bazaar's administration requires posted prices to
reflect the Government's price caps. However, food vendors were
selling their products at individually negotiated prices, which were
11 to 15 percent higher that posted prices. For example, while the
posted price for a kilo of lamb was 39,000 manat ($2.74),a meat
vendor offered it for a 45,000 manat ($3.16). A whole chicken at a
posted price of 40,000 manat ($2.81) was offered for 45,000 manat
($3.16) per kilo. A kilo of beef was offered for 50,000 manat
($3.52) per kilo against the posted price of 45,000 manat per kilo
($3.16). (NOTE: The current exchange rate is USD/14,215 old
Turkmen Manat or 2.84 new Turkmen Denominated Manat. For
convenience, food vendors at the bazaar still post their prices in
old Turkmen Manat. Only state shops post prices in new Turkmen
Denominated Manat. END NOTE.) Local people have a common
understanding that if they demand that vendors sell at the
Government imposed prices, they will get poor quality products or be
cheated on the scale.
4. (SBU) The Government introduced the recent cap on food prices in
the middle of March after the President demanded lower food prices
for the population. Since 2005 the Government has periodically
imposed price controls on food by enforcing price caps for certain
food items. These have included meat, the price of which has
steadily increased due to the increased cost of inputs, and chicken
and eggs, prices for which were always high due to their short
supply. The Government continues to buy low quality "buffalo meat"
from India and American chicken legs ("Bush legs") to offer
alternative meat at affordable prices to Turkmenistan's low-income
population. The price of "buffalo meat" is 40,000 manat/kilo; a
kilo of "Bush legs" is offered for 34,000 manat.
5. (SBU) President Berdimuhamedov appears to have a better
understanding of the market economy than his predecessor and has not
relied exclusively on price controls to address the issue of food
prices. In March, 2008 he offered a favorable loan program to
support domestic poultry production. The program started in June of
2008, and currently, the local market is self-sufficient in locally
supplied chicken and eggs. In 2007, the price of chicken was 60,000
manat/kilo and eggs 30,000 manat per ten eggs. The current price is
45,000 manat and 15,000 manat, respectively.
6. (SBU) COMMENT: The Government's program to support domestic
poultry producers in order to meet local demand for poultry products
and lower their prices proved to be successful. In order to lower
meat prices, the Government needs to offer a comparable program for
livestock producers. END COMMENT.
MILES