VZCZCXRO1587
PP RUEHLN RUEHVK RUEHYG
DE RUEHDBU #1456 2851220
ZNR UUUUU ZZH
P R 121220Z OCT 07
FM AMEMBASSY DUSHANBE
TO RUEHC/SECSTATE WASHDC PRIORITY 1109
INFO RUEHIL/AMEMBASSY ISLAMABAD 2258
RUEHBUL/AMEMBASSY KABUL 2269
RUEHNE/AMEMBASSY NEW DELHI 2214
RUCNCIS/CIS COLLECTIVE
RUEHDBU/AMEMBASSY DUSHANBE 3012

UNCLAS DUSHANBE 001456 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV ECON TI
SUBJECT: PRICE OF FLOUR IN TAJIKISTAN DOUBLES 
 
 
¶1.  (U) Summary: The price of flour has risen 100 percent in 
Tajikistan in the last few weeks.  Flour is a staple of the 
Tajik diet, and the price rise follows a regional trend of sharp 
inflation in foodstuffs.  The government has sought to deflect 
responsibility for the price increases, but discontent is likely 
to simmer over the coming months.  End summary. 
 
¶2.  (U) In recent weeks, the price of flour has risen by 
approximately 100 percent.  A 50 kg sack of flour that cost 
50-60 somoni ($14-17) last month now costs 100-120 somoni 
($30-35).  The average monthly wage in the country is 
approximately 30 somoni ($8.50) in rural areas and 120 somoni 
($34) in urban areas.  The price rise follows a regional trend 
of increasing food prices.  Flour is a food staple throughout 
Central Asia, but it is particularly important in Tajikistan. 
Most Tajiks cannot afford alternatives, and rely on bread as the 
basis of their diets.  Tajikistan imports most of its flour from 
Kazakhstan. 
 
¶3.  (U) Officials have assigned blame for the sudden price rises 
to a broad spectrum of sources, attempting to deflect direct 
criticism of the government.  The government media has reported 
the price increases as being a function of world markets, over 
which the government has little control.  During a recent forum 
televised on state television, government economists blamed 
corrupt customs officials for increasing the price of imported 
grain.  The same economists cited the mafia for pushing business 
people and entrepreneurs out of the market. 
 
¶4.  (U) The government media has also attempted to assuage 
concerns about flour and grain shortages by reporting that 
Kazakhstan and Russia will ensure a ready supply.  After a state 
visit by Kazakh President Nazarbaev in mid-September, state 
television broadcasted a press conference in which Nazarbaev 
said, "We will not let Tajikistan go hungry."  The chairman of 
the state-controlled grain company recently announced the 
purchase of 5000 tons of Russian flour, which he thought would 
lead to price reductions. 
 
¶5.  (U) Public reaction has been muted.  The average Tajik 
citizen bemoans the dramatic increase in food prices, but there 
have been no significant demonstrations.  Independent newspapers 
have sharply criticized the authorities for not reacting 
quickly, and one paper published a survey in which half of the 
respondents believed that the price rises could be politically 
destabilizing.  Opposition parties have called for the 
government to reduce tariffs on grain imports. 
 
¶6.  (U) Comment: While there are a number of reasons for the 
price rises, the government's failures to address corruption and 
reform the economy magnify the economic hardships that Tajiks 
are encountering. The government is approaching this issue as a 
short term phenomenon, but the soaring price of basic foodstuffs 
adds to simmering discontent with the government.  Opposition 
parties may exploit this discontent.  The price rises are also a 
reminder that Tajikistan, the poorest country in the former 
Soviet Union, remains dependent on imports for approximately 80% 
of it food.  Our best tool for dealing with the humanitarian 
consequences of food shortages and contributing to rural 
development in Tajikistan is the successful USAID Food For Peace 
program, which unfortunately will be discontinued after this 
year.  End comment. 
JACOBSON