Three-to-five-percent price hike expected in Armenia - expert

Three-to-five-percent price hike expected in Armenia - expert

YEREVAN, July 23. /ARKA/. Consumer commodities in Armenia are believed to go 3% up because of the increase in electricity prices, Babken Pipoyan, chairman of the Informed and Protected Consumer NGO, said Wednesday at a news conference. 

On June 7, Armenia’s Public Services Regulatory Commission approved almost a 10 percent rise in electricity prices for households allowing the Electrical Networks of Armenia distributor to charge 41.85 drams per 1 kWh of electricity during daylight hours (from 7:00 to 23:00), up from current 38 drams and 31.5 drams for night hours (from 23:00 to 7:00), up from current 28 drams. The decisions come into force on 1 August 2014.

“Prices for consumer goods will jump 3%, and those for first-priority goods may leap even 5% as a result of disguised increase,” Pipoyan said.

He explained what he meant by saying “disguised”. The thing is that the producers reduce weight of some products leaving the price unchanged. Very often containers, packs and even labels of such products remain unchanged as well, and weight is written in very small and almost invisible characters, and therefore consumers don’t guess that the prices have been increased.  

The expert said that in developed countries a ten-percent increase in electricity prices drive prices for consumer prices 1-1.5% up, while in Armenia the power price rise triggers incommensurable price hikes.   

“This happens in Armenia, since not a single economic entity has ever been punished for inadequate increase of prices,” Pipoyan said. 

In his opinion, electric power price rise may have also another adverse effect – owners of stores, especially small, will start saving electric energy for paying less money for that, and this may affect the temperature regime necessary for preserving foods posing threat to consumers’ health. ($1 – AMD 406.84). --0---

15:16 23.07.2014

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