"Arrow Weights" of Product Balance Curve

Rice in "Mirror Statistics"

By means of "mirror statistics" (comparison of the information of the local customs with the information of the exporting country - ed.), it is proved that so far the Azerbaijani customs has not fully registered the imported products. For example, according to UN Comtrade, in 2010-2017 approximately 400,000 tons of rice worth $ 301 million was imported to Azerbaijan. The study showed that only 124.4 thousand tons worth 105 million were registered at the Azerbaijani customs. In other words, over the past 8 years, rice imports were reduced by three times. After the devaluation of the manat in 2015, the customs authorities gradually eliminated the practice of evading goods from registration and taxes. According to the State Customs Committee, over 9 months of this year over 37 thousand tons of rice was imported into the country. This is 5.4% less than in the same period of 2017. The State Statistics Committee states that in 2017 rice production in Azerbaijan from 5.4 thousand tons reached 15.9 thousand tons.

State Program Has Not Reached Goal

The fact that the customs information did not reflect the real state of affairs created false information about the level of import dependence for many years. This is clearly seen in the example of rice. According to the State Statistics Committee, in 2012-2015, the dependence on imports in rice consumption ranged from 85 to 90 percent, although this figure was close to 95 percent. In 2017, due to an increase in local production, the level of rice self-sufficiency was able to rise to 23.8%.

Experts substantiate the dependence of Azerbaijan on food imports by the fact that the local production of most of the necessary products (sugar, tea, vegetable oil, etc.) is based on imported raw materials.

The government is aware of this, and certain measures are being taken to change the situation. However, despite the fact that in 2008-2015, the implementation of the state program on guaranteed food provision to the population of Azerbaijan was completed, many goals have not yet been achieved. For example, the document provides for bringing tea production to 3,000 tons per year in 2015 (in 2017 to 775 tons), crop areas for feed - up to 500 thousand hectares (in 2017 - 356 thousand hectares), areas for oily plants - up to 135 thousand hectares (in 2017 - 51 thousand hectares), and the area under sugar beet - up to 20 thousand hectares (in 2017 - 13.9 thousand hectares), which turned out to be impossible. During this period, due to large grain farms, the official grain production exceeded the indicator noted in the state program (2.8 million tons) (in 2018 - 3 million 50 thousand tons - Ed.). However, dependence on grain imports is still above 40 percent.

Two + Two Not Always Four

Statistics, making up the food balance in many items, comes to the wrong result by using simple mathematical methods. In terms of tea consumption, you can see this clearly. Let's identify it on the basis of official data. In 2010-2014 in Azerbaijan, the mass of tea harvested from plantations and processed did not exceed 600 tons. In 2014, it even amounted to 474 tons. This is information collected by local structures of the State Statistics Committee. In 2016, the production of tea leaves exceeded 1,000 tons, and last year the production again fell to 775 tons.

However, the same State Statistics Committee, providing information on the production of local tea in the food balance sheets this year, referred to other indicators. These figures are mainly based on information from tea packaging factories engaged in the fermentation and packaging of imported tea. According to these indicators, tea production in Azerbaijan amounted to 52.6 thousand tons, although only 5,060 tons of them are local production. To obtain the annual consumption of tea, the State Statistics Committee uses a simple arithmetic method, adding the import indicator and the production data of tea-packing factories. And this is not correct.

As a result, for example, in 2017, tea consumption in Azerbaijan amounted to more than 22.2 thousand tons. In fact, consumption is 2 times lower.

A similar situation is with vegetable oil. There are few processing enterprises that "feed" on the production of local maize and sunflower. Processing companies specialize in the refining of imported oil and its packaging.

Most of the packaged products are then exported to other countries. If you believe the State Statistics Committee, in 2012-2017, the consumption of vegetable oil in Azerbaijan increased about 2 times and reached 155.6 thousand tons (2017). As a result, although it was announced that the minimum rate of consumption of vegetable oil per person in 2014 was 9.8 kg per year (including margarine), the State Statistics Committee stated in the food balance in 2017 that, on average per capita, the consumption was 16 kg of vegetable oil and 3.1 kg of margarine. Note that according to official estimates 10 years ago, in 2007, the consumption of vegetable oil per person was 8.7 kg.

Information about the consumption of sugar is also controversial. According to the State Statistics Committee, annually in Azerbaijan there is 500-600 thousand tons of sugar in circulation. According to the balance, since 2012, sugar consumption has increased from 195 thousand tons to 256 thousand tons (2017). However, the State Statistics Committee, in drawing up the balance sheet, came to results not reflecting real life by performing a mathematical addition of local production based on imported raw sugar. For this reason, according to the State Statistics Committee, at the beginning of 2018 sugar (298 thousand tons) in the warehouses was more than the annual consumption in the country. It is not known whether there is a warehouse in the country capable of storing such amount of sugar in a qualitative state.

State Statistics Committee Inflates Consumption

The State Statistics Committee in the preparation of reports on the consumption of food products per capita in Azerbaijan refers to this information. For example, since 2012, tea consumption per person has increased by 600 grams, reaching 2,300 grams in 2013. This is 5 times higher than the average consumption of tea in the world (430 grams). Or, if in 2007 the government claimed that sugar consumption per person was 11.8 kg per year, now it is argued that this figure has reached 26.3 kg (+2.5 times). As for the consumption of rice, in 2017 this figure was 6.2 kg per person (2012 - 3.1 kg) and is very likely to correspond to reality now.

The State Statistics Committee is aware of this abnormal situation. In this structure, they say that in their calculations they use the methodology used in the United Nations Food and Agriculture Organization (FAO), and this has led to non-genuine results. FAO has already been informed about this and the State Statistics Committee is waiting for new recommendations from it.