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. Last Updated: 07/27/2016

Putin Seeking to Avoid Alcohol Crisis

President Vladimir Putin has demanded that his government come up with urgent measures to avert a potential repeat of last year's alcohol crisis before next month, when the state database created to track alcohol sales is due to be fully automated.

In a letter to Prime Minister Mikhail Fradkov dated Dec. 26, Putin requested that "urgent measures" be taken in order to improve the situation "through the protection of state interests," Kommersant reported Monday, citing a copy of the letter.

In the letter, Putin proposed hiking excise duties for industrial alcohol products, limiting the retail sales of alcohol and increasing the penalties for those producing and selling bootlegged alcohol, Kommersant said. The letter came in response to a review by the presidential administration into the government's handling of the alcohol crisis last year.

Supplies of alcohol could face disruption from Feb. 1, when the Unified State Automated Information System, or EGAIS, which was introduced last year and run by the state-owned firm Atlas, switches to an automated system.

Although EGAIS was intended to cut down on the illegal production and sale of bootlegged alcohol by providing a database containing records for all alcoholic beverages sold in Russia, the system worked badly and saw alcohol supplies running dry in stores nationwide over the summer.

Figures for 2006 released by the State Statistics Service on Friday showed that ethanol production dropped nearly 30 percent and overall spirits production suffered a 9.6 percent drop.

The new, fully automated system will see the current manual input method replaced by a network of electronic scanners in alcohol production plants. But many manufacturers are complaining that, with the necessary equipment still to be delivered, they will not be ready.

"Only 20 percent of the country's alcohol producers will be able to work under the new conditions and it had just got to the point when the president had to step in and do something," said Alexander Korovka, spokesman for Russian Alcohol, a liquor producer.

Korovka said he hoped the switch to the automated system would be postponed until at least November.

Vitaly Kurilov, a spokesman for Liviz, a large vodka distillery, said that although everything was being done to get ready for the change, no one could be sure how the transition would go.

But a spokesman for the National Union for Wine and Spirits Producers and Distributors, Vadim Dobriz, was more upbeat about the change.

"In my opinion, there will be no crisis," he said. "No one, not the alcohol industry or the government, needs or wants a repeat of what happened last year."

The proposal to raise duties on the industrial alcohol used to make moonshine prompted fears of huge price hikes for chemicals used in the domestic manufacture of camera film, perfume and household cleaning agents.

A spokeswoman for Tasma, a leading Russian producer of photographic film, was unable to comment immediately on any potential effect the new moves might have.