Natalia Shagaida: “Food Inflation is Higher than the Global Average”

In November, the FAO Food Price Index kept growing. Natalia Shagaida, Head of the Agrarian Policy Department, Gaidar Institute told Agroinvestor about the factors which caused food price hikes and the measures to be taken to push them down.

“The first problem is that food inflation in Russia is higher than the global average. Why is it so? We have to look into it. It is a matter of politics,” Natalia Shagaida commented.

According to Natalia Shagaida, the second problem consists in the fact that Russia used to have high food inflation, for example, in 2015-2016, but it caused a stir.

“In 2021, the difference between prices rises and falling incomes is too big, so people have started to pay attention to the inflation. It is necessary not only to fight it, but also to do something to facilitate an increase in earnings,” Natalia Shagaida says.

According to Natalia Shagaida, the authorities are currently taking efforts to push down food prices, for example, they have cancelled import duties on meat. Such measures facilitate competition, so if there are less expensive products somewhere in the world than in Russia, they can be brought to the Russian market. Such measures help reduce the rate of inflation, Natalia Shagaida concludes.