Greece stays one of the vital costly nations within the Eurozone for traditional grocery store merchandise.
A Financial institution of Greece (Financial institution of Greece) examine is revealing, in response to which Greeks pay customary merchandise as much as 10% increased than the eurozone.
The Central Financial institution factors out that the imported inflationary pressures of latest years have lowered the buying energy of households, which is steadily being restored on the one hand with the rise in wages and alternatively with the gradual discount of inflation in latest months.
Aside from inflation, nonetheless, curiosity can be centered on value variations between eurozone nations, that are nonetheless important, regardless of the absence of commerce restrictions and the elimination of alternate price fluctuations, whereas numerous surveys present that Greece is amongst of the costliest nations in items equivalent to child method and laundry detergent.
The examine investigates the evolution and persistence of value differentials, specializing in 41 classes of normal grocery store branded merchandise and evaluating costs in Greece with costs in 9 different eurozone nations.
Primarily based on the estimates of a earlier examine by the Financial institution of Greece, the ultimate (unit) shelf value of a regular branded grocery store product in a rustic depends upon 4 components: (a) the diploma of focus of the suppliers’ market, (b) the market construction of outlets (supermarkets), (c) client habits and (d) different variables equivalent to VAT, wages, rents, unemployment, per capita earnings, and so forth.
Regardless of the outstanding progress achieved within the interval 2011-2023, as value variations between Greece and different nations have decreased considerably, Greece stays an costly nation for traditional grocery store merchandise.
Merchandise in supermarkets
For instance, if we take the merchandise by which Greece is the costliest nation among the many Eurozone nations, equivalent to floor espresso, butter, margarine, long-term additional pasteurized (UHT) milk, paper towels, bathroom paper, toothpaste and carbonated water, we will to research to what extent these excessive values are related to variations
in our explanatory variables.
For instance, floor espresso is 50% dearer, butter 54%, margarine 60% and napkins 100%.
In accordance with the examine’s estimates, costs in Greece are on common about 10% increased in comparison with the Eurozone.
The excessive costs largely mirror elevated focus within the provider market, the place giant multinationals function that provide the market with imported merchandise, distortions within the retail market, in addition to variations in client habits, equivalent to buying small packages.
The examine concludes that simulating the construction of the Greek market and client conduct in Greece with the corresponding ranges within the Eurozone would result in important value reductions.
Particularly, for the group of merchandise with the best gross sales within the pattern, the value discount in Greece would attain a median of 17 share factors, whereas for the group of merchandise the place Greece is without doubt one of the costliest nations, the value discount would attain a median of the 30 share factors.
As within the interval 2011-2023 the value variations between Greece and the opposite nations within the pattern decreased by a complete of 9 share factors, it’s concluded that there’s room for additional enchancment with interventions that enhance competitors between suppliers, result in adjustments out there construction of outlets and – in the long run – goal to strengthen client literacy.
Relating to the provider market, elevated competitors would result in decrease costs in virtually the entire merchandise within the examine, as, for every product class, the market-leading provider holds a bigger share in Greece than within the Eurozone. Additionally, additional reductions within the costs of branded merchandise can be achieved by the better penetration of personal label merchandise.
Lastly, with regard to the grocery store market, it’s estimated that value reductions may come from the rise of native competitors for the patron on the one hand, and from the creation of shopping for teams for suppliers on the opposite, in order that they’re compensated the oligopolistic practices of multinationals and to realize higher wholesale costs.
This examine reveals that along with branded standardized grocery store merchandise, there are a number of different gadgets which might be equally necessary to customers, equivalent to unprocessed meals gadgets and providers which might be largely domestically produced.
For a big a part of merchandise of this sort, Greece is among the many nations with the bottom costs. Subsequently, small native producers might not observe the identical pricing methods as within the case of many branded merchandise produced by giant multinationals.
It’s famous that inflation in Greece has decreased considerably in latest months, together with in meals gadgets, and stays to a big extent (round 80%) imported.
Supply: ot.gr
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