Anti-trust regulators said on Wednesday that they are investigating a nearly 10 percent rise in the prices of sugar in Armenia which some analysts blame on a long-standing monopoly enjoyed by a government-linked businessman.
The prices of sugar in supermarkets and food stores in Yerevan now vary from 410 drams (85 U.S. cents) to 430 drams per kilogram, up from 380-400 drams about a month ago. “It has been going up by 2, 3 or 5 drams [per kilogram] for the past month,” one shop assistant told RFE/RL’s Armenian service (Azatutyun.am).
Alex Grig, a company that imports and manufactures the bulk of sugar sold in Armenia, has given no official explanation for the price hike. Its representatives were not available for comment on Wednesday.
Alex Grig is owned by the family of Samvel Aleksanian, one of the country’s richest men who also controls imports of other basic foodstuffs such as wheat and cooking oil. Aleksanian is also a parliament deputy representing President Serzh Sarkisian’s Republican Party (HHK).
He has long been accused by opposition politicians and media of enjoying privileged treatment by the government in return for earning the HHK and Sarkisian many votes in Yerevan’s Malatia-Sebastia district, his de facto fiefdom.
The State Commission on the Protection of Economic Competition (SCPEC) said, meanwhile, that it has launched an inquiry into the sugar market. “Given the importance of this market and its socioeconomic impact, the commission has started looking into the causes of the rise in the sugar price to determine whether it is justified,” the SCPEC spokeswoman, Gayane Sahakian, told RFE/RL’s Armenian service (Azatutyun.am).
The anti-trust body, which is empowered to impose heavy fines on businesses, will complete the inquiry “as soon as possible,” said Sahakian.
Hayk Gevorgian, the economic writer for the “Haykakan Zhamanak” daily, attributed the price hike to the sugar monopoly, saying that Alex Grig is abusing its dominant position in the market to make extra profits. Citing data from the national customs service, Gevorgian said that most of the sugar currently sold in Armenia was imported in the first quarter of this year when the international price of the foodstuff was lower.
Prime Minister Karen Karapetian pledged to liberalize the lucrative imports of key goods and commodities shortly after taking office in September. Karapetian declared recently that “every citizen of Armenia can import any product without a hurdle.”
The State Revenue Committee (SRC) said on Monday that new players have already “emerged in the area of imports.” It added that Vartan Harutiunian, the new SRC chief handpicked by Karapetian, has instructed customs officials to “ensure a fair and competitive environment” for all importers.