DUSHANBE, July 4, 2011, Asia-Plus — Continuing rise in fuel prices is leading to increase in price for other essential goods in the country, Bahodur Habibov, chairman of the Tajik Consumers’ Union, said in an interview with Asia-Plus.
“In the economy, everything depends on freight transportation expenses,” said the expert, “Fuel prices may influence the country’s food security, if farmers fail to find money for fuel supplies during harvesting campaign. If fuel prices rise, then prices for other essential goods would rise in a domino effect.”
Besides, a sudden fuel spike may also influence quality of fuels. “Any rise in prices becomes a potential reason for machinations – they dilute fuels, etc. There are already complaints about quality of gasoline,” Habibov said.
Moreover, rise in oil product prices may lead to decrease in purchasing power of the population, increase in the inflation rate, social tension and other negative phenomena in the economy, Habibov added.
It is to be noted that consumer prices in Tajikistan have risen dramatically over the last year. According to the National Bank of Tajikistan (NBT), consume prices rose 14.4 percent in a year to April 30, 2011 and inflation for January-April this year stood at 6.1 percent.
Local experts say food prices in Tajikistan have risen dramatically due to a recent increase in the price of fuel and the U.S. dollar”s rise against the local currency. According to official data, Tajikistan imports 60 percent of its food and all of its fuel and mineral fertilizers.
According to the statistical data from the Customs Service, Tajikistan’s fuel imports have fallen 11 percent over the first five months of this year. Some 200,000 tons of oil products have been supplied to the countries over the report period. Russian reportedly accounted for 90 percent (180,000 tons) of Tajikistan’s fuel imports over the report period.
We will recall that Tajikistan along with Kyrgyzstan was exempted from paying Russian tariffs on oil and gasoline exports from 1995-2010. When Russia cancelled Tajikistan”s tax exemption on May 1, 2010, Tajik Prime Minister Oqil Oqilov sent a letter to Russian counterpart Vladimir Putin asking for the tax-free status to be restored. Afterward, working groups from the two sides held several rounds of negotiations on this subject. in March this year, Russia waived the new tariffs for Kyrgyzstan, while continuing to increase tariffs for Tajikistan.
