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Price hikes shock Greeks: +50% on electricity bills, 15%-20% on essential goods

Price hikes with shocking 50% increase on electricity bills as from September and 15%-20% up in several essential goods are threaten to push one in three Greek household into impoverishment. The government signals that it will take measures to contain the problem through a series of intervention in a market that operates with its own rules.

The Greek government justifies the hikes with increases in energy and consequently in transport worldwide as well as with the new favorite narrative of the “climate change”, that is prolonged heatwave and drought that increased the consumption demand.

At least two ministers warned of the price hikes at the cabinet meeting on Thursday describing them as “a global phenomenon that will not leave our country unaffected.”

Development Minister Adonis Georgiadis cited as example Greeks’ favorite drink, the coffee and said that its price at cafe can go up from 2 euros to 5 euros. *Typical for this minister is that he cited “the drought in Brazil” as if there is only one country that produces coffee.

Rural Development Minister Spilios Livanos spoke of price increases of more than 40% in animal feed and in raw materials that affect the construction sector.

It should be noted that media were speaking of 50% hikes on electricity bills already beginning of August.

Prime Minister Kyriakos Mitsotakis will announce measures to ease the pressure on electricity consumers at the International Fair of Thessaloniki next weekend, media report, adding that the Energy Minister will ask the electricity sector to contribute toward the containment of rate hikes.

Power rates get priority as Finance Ministry sources say that the hikes will have some permanent features which will hurt large and socially vulnerable sections of the population, reported kathimerini adding that the natural gas prices are soaring as well.

“An increase in the prices of essential goods 15% -20% should be considered as very probable,” Professor of Economics at the University of Macedonia Giannis Hatzidimitriou but also consumer organizations told newspaper ethnos on Saturday. They point out at the risk that one in three Greek households will face small or big impoverishment problems in upcoming winter.

Households at risk of impoverishment

Chatzidimitriou recalled that due to various parameters price increases began already in the first months of the year [KTG reported about in June] and  showed significant upward trends from late spring onward. He predicted that a clear picture of how the situation will develop in household wallets is very likely in upcoming October or November.

However, based on current data, an increase in commodity prices of around 15% -20% should be considered very likely. The above percentage may not be too high, however, in no case can it be characterized as easily manageable by families that even today have very little income available to make a living.

“If this upward trend in prices continues, I believe that 50% of households will not face any problems. A 20% will be forced to reduce consumption, but I believe it will endure, but the remaining 30% will face serious problems, especially if the increase in prices is great for basic goods. For example, if bread or milk increase by 10%, the situation will be generally manageable, however, the problems will be great and some families will be very stressed if their prices increase by 30% or 40 %,” the professor said.

Profiteering

President of the Center for Consumer Protection (KEPKA), Nikos Tsemperlidis, called on consumers and producers to rally for a collective response, in order to send a strong message about the poor functioning of the market and reduce the phenomena of impoverishment.

Tsemperlidis underlined that there are already phenomena of speculation and profiteering in the market.

PS How will the PM and the government contain the price increases in the energy sector? Advising us to switch off consumption? He will probably announce some direct and indirect taxes decreases and consumers paying +50%  on their electricity bills and +15%-20% in the essential goods will see the benefits of the government measures in the …years to come.

Of course, there is not talk of salary increases, especially when Greeks fear of another lockdown due to the pandemic even if the government vehemently rejects such an option.

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17 comments

  1. If you have voted for this neo-liberal government, then you shouldn’t be surprised that they protect the ruthless profit principle of the shameless producers in the energy sector.

    • Who to vote for then? They are all the same, just different names.

    • not to mention the crony-capitalism of feeding enormous subsidies to their connected friends and ‘partners’ through the ‘green’ scam of wind turbines etc.. and hey they need that money, theyve got a lot more of those things to put up real fast now in euboia!

  2. neo-liberal or dictator ?

  3. They are moving on to their next favorite lie and excuse for everything, the climate change. Commies took over the world and this is the result, yet nobody is still fighting. Sad

    • Please, PLEASE, tell me, who is a “commie”? When did ND turn left and join KKE? I guess it was probably around the same time you learned what the word “communist” means – NEVER!

  4. Is that electricity consumed going up in price OR the other ninety per cent of the bill that comprises tax and duties?

    What will go up is sure to be theft.

  5. Go and buy solar pannels! we have been off grid for 6 years and our only cost is buying new batteries which still work well now so maybe in 2 years time. That makes our total electricity cost about 30-40 euros per month over 8 years. It really makes sense here in greece where there is so much sun. The only price to pay is that you run things like dishwashers and washing machines in daytime and not at night.

    • I forgot ……also we have never had a power cut! Or had to remember to pay a bill.

    • Can you tell me how to do this, who to contact for the panels? Would appreciate your help. Thank you.

      • Hi Liz, It depends where you live, we are near kalamata and use Illias and Mike at Patsavouras here [..]. Maybe ask people where you live or look for houses with photo voltaic (PV) pannels and ask them? We have 3kw of pannels on the roof and a 3kw inverter with 1200 amp hours of batteries running a 48 volt system. We are about to double the pannels and inverter as we now want an electric car as well and a spa. Good luck! (can the mediator send liz my email please)

  6. So its finally happening, Govt received 32 Billion ‘Corona rebuild Money’ from ECB, someone keeps buying Greek Bonds at 0% interest (ECB). The Blame is on Corona Virus and Climate change but the real villain here is Monetary Expansion Globally. Now the Governments of the world can’t increase interest rates, so as not to cause a market calamity, they will simply inflate their debts away at our expense. Think of Inflation as the new tax. Your euros and USD’s etc are becoming more and more worthless, so you’ll need to buy assets (property- but this will likely be heavily taxed) to keep your wealth, or the easiest option is Bitcoin. I’ve been warning people about this for a year now and now I’m starting to see it in the supermarkets etc

    • It is remarkable that it’s finally coming true. When I started telling this to people in 2014 they called me a moron. I didn’t think the house of cards would crumble this soon but being right is… fun and not fun. Not fun because so many people are about to lose literally everything they ever had, fun because BTC gave me a pretty good life

    • Inflation has to go somewhere. If they keep interest rates artificially low in order to avoid a market calamity, as you said, inflation goes up but they are pretending there is not inflation but instead prices of everything go up. Real inflation is still not double digits I think but people will feel it in their pockets.

      But the times of QE and the central banks buying up everything is coming to an end. The FED is tapering and the ECB will follow.

      Big market correction will follow and it will be brutal. By design perhaps.

      • What is their excuse for the power increase? Not like they have done anything to improve the service or update the utility poles that is for certain. The poles in our back yard were installed when Papandreou Sr. held his first office. 😂

  7. Greed and power rule the world!!!