According to experts, prices will rise for almost all types of goods in 2022 in Kyrgyzstan. The reason for this is a possible increase in the exchange rate of the U.S. dollar and two previous lean years.

Aigul Berdigulova, a Senior Analyst at the Country Analysis Center of the Eurasian Development Bank, noted that the gaps in transport and logistics chains are unlikely to be fully restored this year. This may slow down the return of inflation to the target benchmark of 5-7 percent.

We forecast a slowdown in inflation to 7 percent by the end of 2022.

Aigul Berdigulova

She noted that this will be possible if the pressure from global food markets is eased and the supply problems are gradually reduced. But given the drought in 2021, we can expect a temporary increase in prices for fruit and vegetable products in the spring and early summer of 2022.

The experts at the National Bank also agree with this position. They reminded that the main factors of consumer price increases in Kyrgyzstan in 2021 were:

• Steady rise in prices on world food markets;
• Increase in tariffs and regulated prices (increase in public transport fares and an increase in electricity tariffs for some groups of consumers);
• A significant rise in the cost of fuel and lubricants, associated with the global trend of rising prices for energy resources.

«In 2022, average annual inflation is projected at 9-10 percent and is expected to be in the single digits by the end of the year. The forecast for 2022 is based on assumptions about the increase in excise taxes on tobacco products, alcoholic beverages and utility tariffs,» the National Bank of Kyrgyzstan stressed.

All product groups will become more expensive this year, Gulnara Uskenbaeva, the head of the Association of Suppliers, said. First of all, food products.

We had a poor harvest in 2020 and 2021. There are no longer any reserves to keep the prices down. Therefore, most likely, by the spring, almost all products will rise in price for objective reasons.

Gulnara Uskenbaeva

She noted that prices are rising one way or another all the time. It’s the current situation, which neither the government nor entrepreneurs can influence. Besides, the domestic business is trying to use its reserves as much as possible.

«Immediately after the rise in supplier prices, we don’t raise them in Kyrgyzstan. But there is a limit, when we can’t hold on any longer. In addition, the situation can be affected by changes in the dollar exchange rate. If it goes up, prices will go up. We practically produce nothing ourselves. The government agrees that we should develop our own production. But it doesn’t go further,» she said.

New tax regulations are unclear, there are problems with food, and government pressure on business is growing. Such an environment does not make entrepreneurs optimistic.

«In fact, we do not see any support for local producers. Yes, some international organizations support this or that cluster. But unfortunately local producers don’t see any support from the local authorities and state bodies,» Gulnara Uskenbaeva concluded.

Fashion industry experts believe that the increase in prices for clothing and accessories in 2022 is inevitable. They predict that the increase will reach 30-40 percent in the premium segment, in the middle — 20-25 percent, mass market products will go up in price by 10-20 percent.

This year, it will be more expensive to build a wardrobe. Prices of both clothes and shoes will grow. This is influenced by several factors at once — an increase in logistics costs, and an increase in raw material prices, and an increase in the cost of work at factories.

«All of this adds up to a price increase of about 10-15 percent. To a greater extent it will affect down jackets, there will be a maximum increase for them, but it is also inevitable for other products. We are doing our best to keep them down, because we see very well that the buyers are not getting more money,» the president of Baon retail chain Ilya Yaroshenko said.

The crisis in the metals market has led to a rise in price of accessories by 30-40 percent, and cotton prices rose by 30 percent last year, which affected the final cost of clothing.

Prices in the premium segment will rise even more significantly. As the Guardian writes, fashion houses are trying to compensate for the losses incurred during the pandemic by raising prices. An increase in the cost of raw materials, container transportation, higher prices for fuel and gray market are among the reasons.

The head of the Union of Oil Traders Zaur Kipkeev notes that prices on the fuel market remain stable so far. Sometimes there is even a slight decrease. However, he cannot predict what prices of petroleum products will be this year.

«It is difficult to make a long-term forecast now. We hope there will not be such a spike in prices as in 2021. If oil traders manage to stock up fuel at relatively low prices during the winter, a serious increase will be avoided,» the head of the Union of Oil Traders said.

As of today, the forecast of world analysts for 2022 for oil prices is $ 72 per barrel. The Deputy Prime Minister of Russia Alexander Novak believes that we should not expect sharp fluctuations in oil prices in 2022. The cost of a barrel, according to his estimates, will remain at about $75.

«In general, the current levels that we see today are quite stable — that is, $75 per barrel, plus or minus 10 percent. It seems to me that these parameters could remain unchanged in 2022,» the Deputy Prime Minister of Russia said in an interview with Russia 24 TV channel.