Dear friends, good day to you all!
Politics has an old habit. When it can’t solve a problem, it tries to postpone it. To buy time. And, if possible, to buy a little social peace along with it.
That’s more or less how yesterday’s agreement between the government, the food industry, and the supermarkets can be interpreted.
Two months without price hikes on store shelves, maintaining price cuts on approximately 2,000 products, and lifting the cap on gross profit margins as of July 1.
In other words, a truce.
A truce with two sides. On the one hand, the cap is being lifted—a measure that Development Minister Takis Theodorikakos described as “highly interventionist and socialist.”
On the other hand, it is being replaced by a joint commitment from the government, industry, and retailers to keep prices stable throughout the summer. The approach is changing. The goal remains the same: to prevent high prices from reaching supermarket checkout counters along with the vacationers.
Is that a bad thing? Not at all. It’s just that it doesn’t solve the problem.
If the commitments are honored, millions of consumers will get through the summer without facing new price hikes on basic food items. No one can view negatively a development that protects—even temporarily—family income.
On the other hand, the agreement does not address the causes of high prices. It addresses their consequences. The Greek market continues to exhibit the paradox of high prices in a country that ranks among those with the lowest disposable incomes in Europe. This is not a natural phenomenon. It is the result of distortions that everyone has recognized for years but that no one is eliminating.
Has anything changed in intra-group transactions? Have the opaque practices that often determine prices from the factory to the shelf been curtailed? Have excessive markups of all kinds in the supply chain been addressed? Has competition been substantially strengthened?
The answer to all these questions is “no.”
And of course, no one expected all these issues to be resolved in a single meeting at the Maximos Mansion, when they have not been resolved even now, after seven years of New Democracy rule.
Because as long as these distortions remain, any intervention seems more like managing the problem than solving it.
But there is something else as well.
The economic calendar is rarely independent of the political calendar. The two months gained in the market are also two months gained in politics. Summer is, after all, the ideal time for a truce. The hard times come later.
With the start of the new school year. With rising household expenses. With winter and the uncertainty surrounding energy costs. With international developments that no one can predict, especially in a world where a new flare-up in the Middle East can overturn every plan within a few days.
Yesterday’s agreement is not insignificant. It is useful. Perhaps even necessary.
It’s just not a solution. It’s a summer truce.
And truces always have one thing in common: they do not end the war. They merely postpone the next battle. The real test will not come in August. It will come when the first early autumn rains fall. Then it will not be determined whether the “gentlemen’s agreement” was upheld. It will be determined whether the Greek market has become fairer and more competitive, or whether only a little more political time has been bought.
Because the first rains have a quality that no government agreement can change: they wash away illusions and reveal what truly endured over the summer.