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Thursday, 18 July 2013

Living & Surviving: Consumer Basket in Eastern Partnership Countries | Eastbook - blog on EU Eastern Partnership


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Can you imagine the situation that a state official buys a new suit once every 5 years or eats 65 g of meat a day? In Ukraine, after calculating the minimum consumer basket cost, it turns out that the level of living means rather the level surviving. The situation in other countries of the Eastern Partnership is pretty the same.
Food
Residents of the Eastern Partnership countries can not afford to buy a lot of food. Source: wikipedia.org
Ukraine
Typically, the minimum consumer basket includes food, non-food goods and services. Americans have on this list tobacco products and alcoholic beverages, as well as the cost of mobile communications and the Internet. In the UK, they decided to include eBook into the consumer basket. But in Ukraine it is much more modest. The minimum consumer basket cost depends on the minimal wage of a person able to work and equals 1218 UAH (about €120).
The details regarding strictly food can be found in our infographic (see below), so here we will consider the rest. In Ukraine, it is belived that a woman should buy a dress once every 5 years, and the man can wear one and the same jacket for 4 years. Per month, an average family uses 3.5 pieces of soap, half a bottle of shampoo (125 ml), 2 packs of washing powder, 1.4 of a toothpaste tube, and 3 rolls of toilet paper. They can afford to buy a new refrigerator every 15 years, and a new TV-set – every 10 years. This year the Ministry of Social Policy promises to introduce a new consumer basket, but it is too early to say there will be any change.
Moldova
The living wage in Moldova is 1,500 lei (about €91). Until 2012 the country even did not have legislation that would define the concept of a living wage. However, the adoption of such a law has not inspired Moldovans. Their living-wage does not include alcoholic beverages and cigarettes, but it’s not a disaster. What is interesting, it does not include coffee, and according to the standard Moldovans may consume only 2 g of tea per day. Also among drinks you will not find fruit juice. In addition, in accordance with the established cost of living, Moldovans can go somewhere only by trolleybus. All other means of transport is a luxury.
Moldovans spend almost half of their income on food. At the same time, for example, Luxembourg population spend only 8.1% of their income on food, in the UK it’s 8.5%, in Germany – 9.8%. This situation is common for all the countries of the former Soviet Union.
Georgia
The cost of living in Georgia is 149 lari (about €70). The consumer basket consists of 288 goods and services. For comparison, in France the consumer basket includes 507 goods and services, the German one – 475. In the Georgian consumer basket you can find a melon, watermelon and even wine (20 g a day). If you look at sweets, you can be surprised. You can eat 5 g of confectionery, 5 g of jam, and 50 g of sugar daily.
Georgia also has another problem. As of 2012, the average pension here is only 70% of the living-wage. During the elections in Georgia Bidzina Ivanishvili promised to raise pensions to the minimum of subsistence level.
Armenia
The living-wage in Armenia is 31 drams (about €60). A normal middle-aged man should consume not more than 2000 calories a day. Quite often those who created the food basket are accused of manipulation. For example, in Armenia’s authorities believe that it’s enough to eat about 300 g of bread and 100 g of meat a day. Everyone knows that baked goods are richer in calories and cheaper than meat products. In addition, those who created the basket decided that the daily intake of calories can be provided with bread.
Because of rising prices, for most citizens of Armenia it is difficult to maintain the proper level. Along with the rise in prices, Armenia is also suffering from unemployment.
Azerbaijan
The living-wage in Azerbaijan is 125 manats (about €120). Recently, in the country they discussed the inclusion of communications services (including Internet) into the basket cost. Nevertheless, the consumer basket of Azerbaijan also has surprises. Experts point out that the share of meat and meat products in the consumer basket in Azerbaijan is less compared to many countries of the CIS and Baltic countries.
In one of his comments the chairman of the Union of Free Consumers Ayyub Huseynov noted that the income of the population should grow by 200%, and only then one can start talking about the consumer basket in accordance with European standards.
Belarus
The living-wage in the country is 1,000,000 rubles (about €87). Thoughtful Belarusian officials added an umbrella to the list of non-food items, but you can buy it only once every 15 years. Belarusians can afford themselves to spend only 1% of their consumption basket on entertainment and recreation.
Older people tell that their pensions do not allow them to buy meat and vegetables in sufficient quantities. The main problem is inflation. Due to financial and social problems Belarusians often recall the promise of President Alexander Lukashenko that “everyone will have something to drink and to eat (charku i shkvarku) on their table”. Thoughthe product prices in Belarus are constantly growing, the population incomes do not become larger.
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All the countries of the Eastern Partnership have problems with products prices and minimum payments (salaries and pensions), and the living-wage looks like a cruel joke. The point is not that people want to eat more meat. With such a basket, people risk undermining their health because they do not get enough vitamins. Another characteristic is that in all the countries of the Eastern Partnership the consumer basket does not include cultural needs of the population. In Ukraine, the subsistence minimum allegedly includes a visit to the theater or a museum, but what does it mean? How can they even talk about theater, when they have barely enough money for food and utilities? The situation is dangerous, because citizens are forced to constantly think where to get a piece of bread.
Click the infographic to enlarge


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