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Economy

Inflation in Greece Highest Since 1993, Family Budgets Withered

ATHENS – In bad news for Greek households and Prime Minister Kyriakos Mitsotakis, with elections coming in 2023, inflation in May leaped another 11.3 percent and has reached levels not seen in 29 years.

With major opposition SYRIZA leader Alexis Tsipras stepping up attacks across the board, and concentrating on the Conservatives leader dealing with the economy, the data gave the Leftists new ammunition.

Hardest hit were food and energy – backing off a pledge, the government said it can’t afford to lower a 24 percent Value Added Tax (VAT) on food – but has has to subsidize electric bills that have nearly doubled and the price of gasoline has neared $10 a gallon – double that in the United States.

Price hikes are continuing, putting further pressure on Mitsotakis even though he had turned away from the COVID-19 pandemic to concentrate on an economic rebound, hoping tourists would bring in critical revenues.

In a report, Kathimerini noted that the price of gas has nearly tripled in a year, exacerbated by the aftermath of Russia’s invasion of Ukraine, and that there’s been a 12.1 percent hike in food prices, including staples

The price jumps in food include bread, milk, olive oil, meat, fruit and vegetables, causing supermarket sales to go down and families choosing cheaper alternatives or generic brands, or cutting back altogether.

The gasoline price jumps have also come at the worst time, with summer travel and the cost of traveling already nearly prohibitive for many who can’t afford to see their own country while foreign visitors are pouring in.

There have been huge hikes as well in the price of ferry and air tickets and accomodations, making domestic travel for many Greeks even more out of reach and adding to further frustration as the government tries to find some answers.

The largest price increases on an annual basis were recorded in energy, said  the Hellenic Statistical Authority (ELSTAT) in noting natural gas went up 172.7 percent compared to May 2021, electricity by 80.2 percent, heating oil 65.6 percent and fuel and lubricants some 36.6 percent – after taking subsidies into account, showing the astronomical increases unrelenting effect.

Among food, bread and cereal prices rose 13.4 percent, the report indicating it’s largely because of a rise in the price of flour after the Russian invasion of Ukraine while for dairy and eggs it was 14.1 percent, for olive oil 23.2 percent, for meat 13.8 percent, for vegetables 13 percent and coffee 6.3 percent and no signs it will get better as pre-election season will begin later this summer.

 

 

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