ECONOMY

Utilities summoned to limit price rises in 2004

Economy and Finance Minister Nikos Christodoulakis announced yesterday that public utilities will only increase their rates slightly in 2004 and that any increases will be below the inflation level. Christodoulakis, who yesterday met leaders of non-listed utilities and other public enterprises, will meet the heads of the main utilities on December 10 and expects to extract undertakings that charges for their services will increase only moderately. The government is worried about inflation, which was running at an annual rate of 3.3 percent at the end of August, far higher than average inflation in the eurozone. Inflation figures for September and October are not available due to strikes at the National Statistics Service, which conducts sample surveys on prices and compiles inflation figures. Christodoulakis also said that public utilities had managed to keep pay rises at reasonable levels. In 2002, for example, expenditure on salaries increased by 5.5 percent, slightly higher than the 5 percent target set by the government, while employment increased by less than 1 percent. Some of the biggest public utilities have been shedding personnel over the past several years. Christodoulakis also advised the heads of non-listed utilities to cut back on advertising expenditure and to find ways to cooperate with each other. The two sides also agreed, as has been done in the recent past, to keep borrowing at the same levels. Development Minister Akis Tsochadzopoulos yesterday said that average inflation for the year will range between 3.5 and 3.6 percent. He added that inflation will fall if market competition functions properly. His comments came during a presentation of the new members of the Competition Commission whose role, he said, was not to control markets but to make certain everyone competes on the same terms. Also yesterday, Christodoulakis presented data showing that, in the first 10 months of the year, revenues lagged only slightly behind the year-end target. Specifically, revenues have increased at a 5.05 percent pace from the same period last year. The 2003 budget target is for an increase of 5.2 percent.