Field Reports

As skyrocketing food prices become an increasingly salient trigger for social and political protests across the developing world, sharp rises in prices for basic foodstuffs in Tajikistan are contributing to a growing popular frustration with the government’s inability to control prices. The food costs in the country rose by up to 30 percent over the last two months, with meat and wheat flour prices jumping 50 percent in some areas. Although government officials expect a moderation in food prices later this year, analysts warn that the costs for major foodstuffs might rise again before Ramadan, the Islamic month of fasting, in August.

No expenses were spared when Grozny’s new state of the art soccer stadium was inaugurated on May 11. The televised event was celebrated by fireworks, musical performances, and a high profile exhibition game between a team from the region and a team consisting of retired international stars led by Diego Armando Maradona.

The victory in the Eurovision song contest has provided a unique opportunity for Azerbaijan to promote its culture and tourism to the world. While the international community thinks the victory should encourage the country to improve its human rights record, domestic observes do not rule out that it could be used for political benefits in the 2013 presidential elections.

The U.S. has approved a credit line to finance Azerbaijan’s first communication satellite despite strong opposition from Armenian lobby groups in the U.S. which argue it could be used for military purposes. The credit agreement between the U.S. Export-Import Bank, an agency of the U.S. government, and the Government of Azerbaijan to finance a purchase of the Azerspace satellite from the U.S. manufacturer Orbital Sciences Corporation will be signed in May 2011. The deal costs US$ 120 million, of which 85 percent will be covered by the loan from the U.S. bank and repaid by Azerbaijan over the next 10 years. The application for Ex-Im financing was made by BNP-Paribas of New York City, and the loan is guaranteed by Azerbaijan's Ministry of Finance. A 15 percent share will be paid by the government of Azerbaijan.

When the Armenian economy abruptly collapsed by over 14 percent in 2009 due to the global economic crisis, there were hopes that the economy would rapidly recover in the following year. However, the recovery was very slow in 2010 with a GDP growth of only 2.6 percent. This was mainly due to a small output in the sphere of agriculture. Whereas in 2009 the volume of agricultural production remained almost intact, it decreased by over 13 percent in 2010 as a result of bad weather and other reasons.

On May 3, the Independent International Commission of Inquiry (Kyrgyzstan Inquiry Commission – KIC) presented its long-awaited report on the inter-ethnic conflict in southern Kyrgyzstan that took place in June last year. The KIC found the Uzbek minority to have been disproportionally victimized in the conflict, provided evidence of official complicity, and claimed that some of the violent acts committed can be considered crimes against humanity. The report stated that increasing political fanaticism based on ethno-nationalistic sentiments in the wake of April 7 events became the main reason for the tragic conflict. A power vacuum and consequent political rivalries and weak state institutions especially in the south of the country contributed to the eruption of violent clashes, the commission reported.

From April 1, 2011, Russia has increased export dues for oil products for countries outside the Customs Union of Russia, Belarus and Kazakhstan. The export due has increased by up to US$ 283 for one ton of refined oil and up to US$ 198 for one ton of dark-oil products. The new export tariffs heavily affect Tajikistan, which imports up to 92 percent of its domestic oil consumption from Russia. The increase of oil export dues has already resulted in a sharp increase of prices for gasoline and essential food products in Tajikistan.

The upcoming parliamentary elections in Turkey should clarify whether Turkish-Armenian relations may improve in a short-term perspective, opening for a resolution of the Nagorno-Karabakh conflict and regional cooperation in the South Caucasus. Regardless of the outcome of the elections, it will clarify the fate of the Turkish-Armenian protocols signed in October 2009. Prime Minister Recep Tayyip Erdogan’s AKP party seems capable of securing a majority in the newly elected parliament and to form a new government. After the elections, the AKP will not be under the threat of instantly losing the support of voters due to opposition criticism, so its leadership may consider the ratification of the protocols safer.

Russian Security Forces have reported that Israpil Validzhanov, who is also known as Emir Khasan, was killed on the night of April 18. Validzhanov was appointed head of Dagestan’s Shariat Jamaat after his predecessor Magomedali Vagabov was killed in August 2010.

The three Foreign Ministers of Azerbaijan, Armenia and Russia held a meeting in Moscow on April 22 to discuss several issues related to the resolution of the conflict between Armenia and Azerbaijan over Nagorno-Karabakh. An issue of special concern is the increased tension along the frontline due to intensifying cease-fire violations over recent months.