Panic buying fueled by fears of price increases erupted in Moscow with customers leaving shelves of food stores bare in a two-day spree, the official Tass news agency said Friday.
The Moscow City Council decreed that beginning Sunday only residents of the capital and the Moscow region will be allowed to buy in Moscow's stores and will be required to show proof of residency.Similar restrictions have been in place in Lithuania for almost a year, but the limits on purchases to Lithuanian citizens reflects nationalist aspirations as well as economic considerations in the more productive Baltic state.
The rush to the stores began after Premier Nikolai Ryzhkov presented a new economic plan for a transition to a modified market economy that will triple the price of bread and more than double the price of meat and fish.
Reports that increased bread prices - from 40 cents a loaf to $1.20 - would go into effect on July 1 sent customers flocking to bakeries.
"The last two days have witnessed an outbreak of panic buying on practically all foodstuffs," Tass said. "In many stores the monthly supplies of of tea, sugar, buckwheat, flour, eggs and macaroni, have all been bought up."
Because average Soviet wages are about $320 a month, the Soviet government subsidizes virtually all foodstuffs, keeping prices low but putting the budget into major deficits.
Meat, for example, costs the government $4 a pound, while customers in state stores can purchase it at 75 cents a pound. Bread is so cheap that farmers buy it at stores to feed it to their cattle as fodder.