As austerity bites hard in Greece and the price of petrol soars to above €1.80 per litre, it has been reported that consumer prices are up to 116 percent more expensive than in the rest of Europe.
Data from the ministry for economic growth, cited by Ifa Magazine, shows that foreign supermarkets are charging more than double the European average for many consumer products in Greece, including food and cleaning products.
Prices will be pushed still higher as the cost of transportation increases due to the inexorable creep in petrol prices which are anticipated to hit €2 per litre by Easter, and even more when the European embargo on Iranian oil comes into effect on July 1. Greece will be most severely affected by the sanctions as Iran has allowed Hellas to purchase oil on credit, something most other suppliers are unwilling to do.
Ekathimerini reported the Hellenic Statistical Authority paints a bleak picture, with supermarket sales declining by 3.3 percent compared to the previous year, illustrating that people are reducing spending on basic household staples. Some supermarkets are replacing branded goods with generic products, making it easier to purchase such an everyday staple as FAGE Greek yogurt in the U.S. than in a Greek store.
Carrefour, the leading supermarket retailer operating in Greece "is facing liquidity problems and has delayed payments to suppliers, who in turn have refused to stock its stores" Stores org. reports.This may account for the lack of basic consumer products on their shelves and their gradual replacement by Carrefour own branded items.
The Greek supermarket retailer Atlantic went bankrupt in 2011. The German chain Lidl remains the only hard discounter in the Greek marketplace but their prices are comparably higher in Greece than the rest of Europe.
In some areas local producers are cutting out the middle man and selling their goods directly to the consumer. The potato selling movement has gathered speed and is to be followed with the sale of Messinian olive oil directly to consumers in Ioannina.
As disposable income shrinks the retail sector is facing more problems and needs to compete aggressively for a share of consumer spending which will continue to shrink as further austerity measures come into play. The EU is already calling for the necessity of yet more new austerity measures.