Restrictive Policies Lead to Rising Farm Prices
Tuesday, 27 February, 2007
Restrictive Policies Lead to Rising Farm Prices
Tuesday, 27 February, 2007
According to the Tajik ministry for economic development, the prices of products such as potatoes, rice, meat and vegetable oils increased by between 20 and 57 per cent last year.
Observers believe these sharp increases are a result of artificial constraints placed on the market in agricultural products.
“The price hikes are in part due to the fact that peasant farmers don’t have access to the market. The legislation is structured in such a way that they don’t count as legal entities,” a source in the agriculture ministry told NBCentralAsia.
The government, not the farmers or consumers, decides which crops are assigned priority status in the marketplace. As a result, the banks lack confidence that loans given to farms will be repaid, so the latter are finding it increasingly difficult to access funding.
Economist Hojimahmad Umarov says the price of fruit and vegetables is rising because of consistently low farm productivity. He discounts exports as a possible constraint on supply, since so little produce is sent abroad. Official estimates suggest only 10 per cent of Tajikistan’s agricultural production is exported,
“The high prices for early vegetables, fruit and potatoes is attributable to inadequate production volumes,” said Umarov. “The production reports need to be examined critically.”
Shuhrat Sirojiddinov, an advisor to the agriculture minister, disagrees, saying prices are being driven up by production costs, not a shortfall in overall supply.
“Tajikistan grows sufficient volumes of fruit and vegetables to meet the needs of the population,” he insisted. “The price increases are [instead] driven by the rising cost of fuel, lubricants and fertilisers.”
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
