ISET

In March 2016, the average cost of cooking one standard Imeretian Khachapuri stood at 3.27GEL, which is 5% lower month-on-month (m/m, that is compared to the previous month), but 6.9% higher year-on-year (y/y, that is compared to the same month of last year).
For foreign currency earners, however, the Khachapuri Index dropped both m/m and y/y.
Even though last month we saw the Georgian lari slightly appreciating against both USD and EUR, this appreciation was more than compensation for by the seasonal decline in the price of cheese (the main khachapuri ingredient).
In yearly comparison, the khachapuri, like many other Georgian products, is cheaper when valued in foreign currency thanks to the large y/y depreciation of the lari.

Spring is already here. Seeing more sunshine and rains, Georgia’s western provinces are enjoying the sharpest seasonal increases in the supply of fresh milk and dairy products, such as Imeretian cheese. This cheese is the main (and most expensive) component of the Georgian khachapuri, driving the sharp seasonal fluctuations of the Khachapuri Index.
In March 2016, the national average cost of cooking one standard Imeretian khachapuri declined to 3.27 GEL, which is 5% lower month-on-month (that is compared to February 2016) but 6.9% higher year-on-year (compared to March 2015). The y/y increase in the Khachaprui Index is roughly in line with the official estimates of annual CPI inflation by GeoStat.

This week, ISET’s Khacahpuri Index team checked whether average hourly wages in different Georgian locations cover the cost of one standard portion of Imeretian khachapuri. Using the cost of khachapuri ingredients in four major Georgian cities (Tbilisi, Telavi, Kutaisi and Batumi) and the latest available data for average monthly wages in the corresponding regions, we calculated that one hour of work would not always suffice to treat you to a portion of delicious Imeretian khachapuri. As we show below, one hour of work can buy you more than one Khachapuri portion in Tbilisi. If you happen to live in Georgia’s periphery, the same one hour of work will buy you only slightly more than half a portion, despite (somewhat) lower prices for khachapuri ingredients.

Based on February data from three open bazaars in Tbilisi, the average cost of cooking one standard portion of Imeretian khachapuri stood at GEL3.47. Someone opting for the convenience of shopping in one of Tbilisi’s major supermarket chains, such as Carrefour, Fresco, Spar or Goodwill, paid 4.40GEL (representing a premium of about 28%) for cooking exactly the same khachapuri. Modern retail outlets definitely offer many advantages for Georgia’s middle class shoppers: an excellent selection of products, air conditioned space, parking, etc. Yet, these advantages come at a cost.

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