NEWS

Greeks leading the field in consumer spending

There is no need to remind anyone that the cost of living in Greece is rising steadily by the year. Greeks are having to dig deeper and deeper into their pockets for food, clothing and other basic necessities. Greece is no longer a cheap country; quite the contrary. In some categories of products and services, it is actually the most expensive in the EU (although its wages remain among the lowest), according to the most recent data from Eurostat on the cost of living and consumer spending in EU member states, culled from a comparative study done over six years. Every July 1 from 1999 until 2004, Eurostat recorded people’s expenditure on products and services in European capitals. It then translated those figures into indicators based on the indicators of Brussels, which was at number 100. In several categories, Greece is near the top the list. For example, over the past few years Athenians have been spending more money on clothes and shoes than anyone else in the EU, even more than Parisians, Londoners or the Viennese. This is only partly due to increased needs for these goods; mainly it is due to the rapid rise in prices, particularly since the euro was introduced. Increased household spending is also apparent in the communications industry, via purchases of technological aids; in 1999, Greece was last on the list of technology consumers, but climbed to ninth place in 2004, probably due to the mania for mobile phones. The consumer model has changed, so expenditure on products in new sectors has increased. There has been a general trend in Greece toward new products, particularly technology, according to Professor Theodosios Palaskas of Panteion University and head of research at the Institute for Economic and Industrial Research. Use of the Internet, he said, is still at low levels in Greece, so there is considerable margin for growth and increased outlay by young people in this sector. «The euro has upset household budgets, but this has occurred in other European countries too; ’rounding-up’ prices has not only happened in Greece,» said Emmanuil Kontopyrakis, general secretary of the National Statistics Service. Nevertheless, Greeks continue to protest at price rises that are disproportionate to wage increases. The transition to the euro had an influence on all European states, but was particularly hard on Greece because of the weak drachma.