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Inflation Fighting Begins with Wheat
Several hours after the government met with Russian President Vladimir Putin yesterday, Prime Minister Viktor Zubkov called an unplanned closed meeting at government headquarters to discuss measures to hold down food prices. Consumer prices rose 7.5 percent in September, the worst indicator for that month since 2000. Alfa Bank predicted yesterday annual inflation to reach 9.5 percent this year.
The Ministry of Economic Development and Trade introduced a draft resolution to impose a duty on grain exports yesterday. Unlike Ukraine, which effectively closed its grain market this summer, Russia only began to limit it in September. According to Reuter's, the draft proposes a 10-percent duty on wheat exports, with a minimum duty of €22 per ton.
A 10-percent duty on barley (minimum €70 per ton) will be imposed as well and Economics Minister Elvira Nabiullina has also proposed a duty on the export of dry milk. According to the Milk Union of Russia, dry milk production in the country is 200,000-240,000 tons per year in recent years and export (to North Africa) and import (from the CIS) are close to equal at around 80,000 tons per year.
The government's measures will not have a quick effect, apparently, the ministers are waiting for the results of the first weeks of this month before making more concrete decisions on fighting inflation.
www.kommersant.com
All the Article in Russian as of Oct. 09, 2007
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