ECONOMY

Retailers may cheat customers on euro

BRUSSELS (AP) – Fears that retailers will try to cheat consumers during the introduction of the euro single currency are on the rise, a European Union survey showed yesterday. The poll, which was carried out during June and July, found that 66 percent of those asked were afraid of abuses and cheating on prices once the euro comes into circulation next January 1, a rise of 5 percent from the May survey. The EU’s Executive Commission polled 6,543 Europeans in the 12 countries participating in the single currency with a margin of error of 4.4 percent. While many retailers have already switched to euro prices, they could use the opportunity to raise prices in part to help recoup the cost of converting from the old national currencies to the euro. The European Central Bank has estimated that the cost to businesses would total some 50 billion euros ($45.5 billion). The EU’s head office warned consumers to be watchful and asked EU governments to closely monitor prices across the 12 countries once the changeover gets underway. The switch from national currencies to the euro is expected to last a few months only. Consumers have to be vigilant, said EU spokesman Gerassimos Thomas. So far we do not have any evidence that prices have gone up at large. Despite this, the European Commission said it would increase its public campaign to better inform the public on the euro and implications on price tags. We cannot dictate prices but we can make sure that retailers and consumers are properly informed, said Thomas. In Paris, the French government announced it was going on the offensive against businesses that are using the country’s switch to the new euro currency as a pretext to raise prices. Finance Minister Laurent Fabius said government watchdog agencies will increase their regular checks of prices of 20,000 products and crack down on businesses that collaborate to round up prices as consumers make the confusing switch from national currencies to euro notes and coins, he said. The government’s latest survey of inflation showed some retailers have already increased prices in the run-up to the Jan. 1 launch, he said. Officials have discovered that prices for some goods, such as laundry or dairy products, have been rising. Inflation remains generally well-contained, but there has been some slippage, and the euro has served as a false pretext for raising prices, Fabius said. In the EU survey, 53 percent felt they were well informed on the euro. The poll found the best informed were those in France with a score of 64 percent. The least informed were those in Greece, with 33 percent and Portugal, 37 percent. The poll did find however that 73 percent of those questioned knew when the date of the changeover was. Thomas admitted that EU governments still had a lot of work to do to get ready for the switch, and to ensure that prices would be converted fairly. We have to continue to work hard. There is an important challenge in the next three to four months that we have to take seriously. More than half of those asked felt the euro would have advantages for Europe, with 56 percent of respondents saying the new currency would promote economic growth. Popularity for the euro continues to rise as the changeover approaches. In the survey, 90 percent said the euro would make it easier to travel between EU nations. An earlier survey released in July showed support for the single currency up 4 percent at 59 percent across the 15-nation bloc.