ECONOMY

Traders take a smooth ride with the euro

The introduction of the euro on January 1 appears to have been smoother and faster than anticipated, according to a nationwide survey by the National Confederation of Greek Commerce (ESEE) released yesterday. According to the survey, conducted by telephone to 500 enterprises of all sizes from January 15 to 18, 35.5 percent of consumers limited their purchases, while the use of credit cards increased 10.5 percent. Retail staff were rated at 58.6 percent having shown a high degree of preparedness, the rest were rated as mediocre. ESEE Chairman Christos Folias said member-traders had held to a gentlemen’s agreement among them not to round off prices upward, in contrast to the widespread practice in the shops where prices tended to rise due to the frequent unwillingness of customers to accept small change. For a product priced 29.65 euros, for instance, the consumer was likely to forego the change of 35 cents, thus effectively causing prices to rise. Due to this tendency, the coins of 1 and 2 cents will be de facto abolished in future, Folias predicted. In certain sectors, suppliers pushed through price increases which had been planned well beforehand, he added. Folias said the introduction of the euro creates new difficulties for Greek enterprises in terms of competitiveness, and stressed the need for accelerating structural changes, privatizations and the upgrading of public infrastructure. He urged the government to reform the taxation system, reducing company taxes by up to half. ESEE considers that the recent spell of bad weather has had a much greater impact on the recent sales period than the euro. Folias expressed ESEE’s disagreement with the prolongation of the sales discount period, effective for up to three months, and the practice of daily discounts, saying that stricter rules should apply for setting up a specific framework. He said that reasonable dates for sales were the periods February 1-20 and August 1-20. Regarding the recently failed merger attempt between National and Alpha banks, Folias said such a very serious move had been pursued hastily and that Greek banks should seek partnerships with foreign banks in order to remain competitive in the new environment of the eurozone.