Consumer goods prices remain high despite crisis

The price tags on a string of basic consumer products remain high in Greece, in some cases reaching 29 percent over that for the same products in other European Union countries, according to a recent Development Ministry study.

Other than the structural problems that plague the domestic market, such as the high cost of transporting goods, ministry officials also suggest that there are cartels controlling certain products in four sectors in the market, which are currently under investigation by the Competition Commission.

According to the study, which compares the prices of 67 basic consumer products in Greece with those in France, Germany, Spain, Bulgaria, Italy and the United Kingdom, Greece ranks as the fourth most expensive country among the seven, with Germany and Spain turning out to be significantly cheaper. This ranking, meanwhile, does not change whether value-added tax is included or not.

Specifically, the prices for 16 separate products are higher in Greece than in the other six countries by as much as 5 to 25 percent. Even in the many cases where the prices here are not the highest, they are among those at the top of the price list as, of the total 67 products surveyed, 35 are more expensive in Greece than the average in the other six countries.

Bulgaria ranking as the cheapest country among the seven comes as no surprise, but the fact that Germany, which has a much higher standard of living than Greece, is much less expensive does, as does the fact that Spain comes second after Bulgaria as the cheapest among the seven. The only saving grace is that Greece ranks as cheapest among the seven for unprocessed agricultural products.

The areas in which prices remain high despite the drop in inflation are breakfast cereals, laundry detergents, personal hygiene products and poultry, which has led the General Secretariat of Commerce to forward this data to the Competition Commission for investigation.

In fact, a joint team from the General Secretariat and the Competition Commission recently raided the offices of an association of food businesses and found evidence suggesting the existence of a cartel.

The Development Ministry, however, suggests that there are other factors contributing to the high cost of consumer products in Greece, such as the supply chain, which accounts for 10-15 percent of the overall cost of the final product, and is in talks with the Transport Ministry to explore ways to bring this cost down.

Last but not least, the Development Ministry is also looking at scrapping price lists, which it says are not adequate for monitoring the prices at which companies sell their products.

Instead it is proposing that suppliers submit a report every three months listing the exact prices at which they sold their products.