According to the Armenian national service for statistics, consumer prices in Armenia rose by 10.6 % in 2010. Most of the goods have risen in cost are foodstuffs, with drinks, cigarettes, diesel fuel and facilities becoming more expensive. However, foodstuffs have risen in cost by 13.1 %, the highest rise rate in 2010 among goods sold in Armenia. Non-food prices rose by 5.6 % and facility tariffs by 4.2 %.
The UN Food and Agriculture Organization has conducted research on prices of foodstuffs in Armenia. Armenia appeared to be among the top 10 countries with the highest foodstuff price rise. The rise continued in January 2011. For example, compared to prices in December 2010, apples have risen in price by almost 60%, potatoes by 24% and cabbages by over 50%. Cereals and vegetable oil have also considerably risen in price.
Fruit and vegetable prices in Yerevan have outdone even Paris, widely known to be one of the most expensive cities in the world. Many fruit and vegetable prices in Yerevan are two or even three times higher than those in Paris, although the average salary is 1500 euros in Paris, and 220 euros in Yerevan.
Central Bank of Armenia chairman Arthur Dzhavadyan has named the Armenian dram's tendency towards devaluation, the current monetary, credit, budget and tax policies and rising prices on international markets as the principal causes of the price rises.
However, there is no permanent tendency for rising food prices in the rest of the world. The government also claims that the rise was to some extent brought about by adverse environmental conditions in 2010.
However, the main problem at the moment is monopolization of the economy and an absence of any real competition on the Armenian market.
"The rise in prices is firstly caused by a lack of control over monopolies. Government policy makes many small- and medium-sized businesses close down. Eventually, small- and medium-sized businesses in Armenia will sink into oblivion. Today there is no competition in the economy, there are just monopolies and oligarchy," a member of the economic committee of the opposition Armenian National Congress, Vahagn Khachaturian.
According to a research study carried out in summer 2010 with the assistance of the U.S. Agency for International Development, entitled "The role of small- and medium-sized business in development of society", in Armenia small and medium business is not significantly important, despite a tendency for the number of enterprises to rise.
Inflation and prices are rising faster than salaries, so the standard of living has decreased substantially in 2010. The authorities don't carry out indexation. The situation has become even more complicated after the recent decision of the newly-appointed mayor of Yerevan, Karen Karapetyan, who prohibited street trading. In addition, new increases in gas tariffs are coming up. Some experts and politicians say that the preconditions for a social revolt are currently present. Discontent is increasing: inflation is over 9 %, the poverty rate has reached 35 % and 60 thousand citizens emigrated from the country in 2010.
Susanna Petrosyan, Yerevan. Exclusive for VK
