Just as the country has fully entered the pre-election period, the issue is back at the center of the political debate. The heated rhetoric from sources at the Ministry of Development, which followed the statements by Metro CEO Aristotelis Panteliadis, that there is no common ground with the ministry as well as the absence of the Ministry of Development’s political leadership at yesterday’s SEVT event, confirm that many “strangers” coexist in the same city.But who is actually responsible for the high prices? The data from the IOBE survey presented yesterday at the SEVT event cast doubt on the notion that the food industry is at the heart of price hikes.
The numbers tell a different story. Food inflation in Greece stood at 4.4% in April; however, the real source of the increases lies in unprocessed foods. Fruits, vegetables, fish, and fresh produce in general are rising at rates many times higher than those of processed foods.
According to the IOBE, unprocessed foods recorded a 9.2% increase, while the increase for processed foods was limited to just 0.6%.
The explanation is simple. Fresh products are directly affected by climate change, reduced production , fluctuations in international commodity markets, and increased transportation costs.
The same conclusion emerges from import data. The cost of imported food is rising significantly faster than the production costs of the Greek food industry. In other words, what the study says is that a significant portion of inflation is“imported.”
And yet, as important as these findings may be, it doesn’t really matter to the consumer whether price increases come from the producer, the processor, the importer, the retailer, or even the government itself. What matters is that prices have risen in recent years and, as it appears, will rise a bit further due to the geopolitical situation and its impact on the entire supply chain, from raw materials to transportation.
Of course, the problem is not just that prices have risen. It is that the economy’s productivity has not increased enough to support higher wages and greater purchasing power. This is an issue that the Hellenic Federation of Enterprises (SEV) and its president, Spyros Theodorakopoulos, have repeatedly highlighted .
The bottom line, however, is that inflation remains the economy’s most insidious “tax.” It is not voted on in Parliament and is not imposed by law. Yet, it steadily erodes household income and undermines their purchasing power. And as is the case with any tax that goes by another name, responsibility is easily shifted from one link in the chain to another.