Armenian Farmers and Vendors

The Armenian Weekly has published an article I wrote about the plight facing farmers in Armenia as well as the hardships that fruit and vegetable vendors have to endure day in and day out. Here are two excerpts:

The expenses associated with farming have skyrocketed in recent years. The price of a 50-kilo load of fertilizer virtually doubled from 4,000 dram in 2008 to 8,000 dram this year. Electricity, which is essential for farmers pumping water from artesian wells, has also increased since last year from 25 dram to 30 dram per kilowatt. The cost of water has gone up by approximately 30 percent. And to have one hectare of land tilled with a hired plow, a farmer is obliged to pay up to 45,000 dram for the job.

There have been times when local governing authorities have put pressure on Virab by extorting bribes.

“They would shut off my electricity and cut off the water supply, so I’d pay them off to keep going,” he said. “The government doesn’t let you work, they don’t want to see you take more for what you’re giving to the land, for what you’re producing while breaking your back, for your own livelihood. They want a slice of the pie, too.”

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In Yerevan, Mgo sells mostly peppers, onions and, especially, cucumbers, piled in four rows about two-feet long at his stand behind the Gomidas Street market. The fruit and vegetable merchants sell their produce in the lot behind the building, which is now used mainly by vendors selling various products made of dried fruit.

The Russian cucumber variety sells for 300 dram—or 81 cents at the current 370 dram-to dollar exchange rate— which Mgo buys for 180 dram. The Armenian sort that he buys at 350 dram from a village nearby Etchmiadzin sells for 400 dram. He insists that it is top quality.

“Business is very bad this year,” he says while frowning. “It’s due to the bad weather. This year there weren’t many cucumbers. I’m managing but barely.”

Anahit sells various vegetables along the sidewalk in front of the Gomidas market. Whenever anyone walks by she entices them to buy her eggplants, tomatoes, and peppers, all of them plump, fully ripe, and glistening.

“I buy tomatoes for 150 and I sell them for 200. Cucumbers that I buy for 250 I sell for 300,” she says disappointedly. “By the end of the day I’m left with between 2,000 and 3,000 dram in my pocket, that’s all. It’s tough.”

I have yet to meet any rich farmers in Armenia. Virab seems to be doing well for himself quite honestly with a two-story home that he built himself in the village from tuf stone surrounded by a lovely garden full of fruit trees. That home lies behind the one his father built decades ago, which will be razed soon. The yogurt his wife produces is amazing, they offered me delicious tan to drink when I visited them. And the homemade cheese is also very good incidentally. But he's in debt as are many other Armenian farmers, if not all of them. If the money lenders suddenly decide to recall their loans he will undoubtedly face some serious financial problems.

Already money is scarce as it is, despite what you may be reading in the news about foreign loans entering Armenia to be redistributed to businesses. Yerevan banks are simply not lending, despite advertisements for five to seven year loans being offered at a ludicrous annual rate of 15 percent. I don't know who is actually benefiting from the money that is supposedly being made available--I am assuming people with connections with bankers and to people connected to the government somehow are seeing it. I can't say that there is any way of knowing for certain what's actually transpiring in Armenia's financial sector.

If anyone is feeling the crisis crunch in Armenia due to the worldwide economic slowdown, it is the farmers and vendors, without a doubt. Farmers will take a huge loss in profits this year because it simply costs too much to work the land. Seed has also gone up in price along with fertilizer and general day-to-day operational costs. And the produce is cheap, there's very little to show for their efforts. I mean, how is it possible that you can buy a kilo of tomatoes in the summer for less than 50 cents five years ongoing--actually even longer--when the cost of living keeps going up and up each year? There's no logic. And the government doesn't seem to care.