The discounts stimulated movement in the market, but there are no shortage of problems, such as the increases in the prices of raw materials, rents and electricity, Stefanos Koursaris, CEO of GS POVEK, told KYPE.
Asked about the traffic in the stores at this time, Mr. Koursaris spoke of two positive facts. The first is the lifting of some strict measures and protocols related to the coronavirus pandemic, as a result of which people go out and change their psychology. The second is that tourist arrivals for the eight months of 2022 are close to 80% of the arrivals of 2019, which was a very good year, the General Secretary of POVEK told KYPE.
On the other hand, he noted, there are also several negatives, such as the ongoing wave of increases and electricity bills. Another negative, he continued, is that the government's announcement to subsidize the increase turned out to be "insufficient, because it covered a very small part of consumers and was - at least for businesses - completely imperceptible", emphasized Mr. Koursaris, adding that, due to the high prices on electricity bills, consumption, consumer psychology and the businesses themselves have been affected.
In addition to the increases, the CEO of POVEK underlined, there is a relative drop in fuel prices, but the increases in transportation and raw materials continue, at a time when the phenomenon of purchases from the occupied territories is taking on "alarming dimensions". "Unfortunately, the provision of the regulation (S.S. of the Green Line) for purchases of products of 260 euros per day from the occupied areas and the non-observance of controls at roadblocks and crossing points combined with the accuracy in the free areas push consumers to the occupied areas, from where fuel is bought, which is a cancer for the gas station owners (S.S. in the free areas), reservations are made in hotels of the occupied and hairdressing and dental services are used", he reported to KYPE.
Furthermore, Mr. Koursaris expressed concern about the wave of rent increases. "Despite the fact that the supply is large, i.e. there are quite a few empty shops, rents have nevertheless taken an upward course, which is worrying and recorded by the Association of Real Estate Appraisers", he stressed, adding that especially in Paphos and the free area of Famagusta, because the approximately 700.000 Russian and Ukrainian tourists were lost, this could not be covered by other markets, leaving these areas in trouble. "We receive quite a few complaints from businesses in those areas that they are in serious trouble and unable to cover their expenses, precisely because of the loss of the Russian and Ukrainian markets," he noted.
Speaking about the sales, the CEO of POVEK stated that, although the prices offered in the sales were quite good, due to the need of businesses for liquidity, and stimulated movement in the market, it has been clearly seen that there is anarchy. “There cannot be sales 365 days a year or for three to four months in a row. This thing causes problems not only for the market but also for the consumer himself," he pointed out, adding that the extended discount period does not work as a positive factor in terms of having healthy competition so that the consumer gets the best possible prices .
"There is no healthy competition at all and we do not hide it. It is not a sale 365 days a year, something is hidden behind it," he said. In addition, Mr. Koursaris spoke of a lack of controls and implementation of laws and regulations by the Ministry of Commerce and the Consumer Protection Service. A 30% increase in the wholesale price of beef was announced on Tuesday, he told KYPE, pointing out that these increases cannot be absorbed by businesses, resulting in the continued rise of inflationary trends, which also affects consumer purchasing power. .
Asked by KYPE about POVEK's reaction to this situation, Mr. Koursaris stated that POVEK has prepared a document with 20 positions, which concern existing problems in the economy but also more generally in the context within which small and medium enterprises work. In September, this document will be put before the candidates for the Presidency of the Republic, with the hope that the positions of POVEK will be integrated into their pre-election programs.
"We believe that the Government is proceeding with jerky moves in terms of solving some problems, such as subsidizing the price of electricity and the announcement to increase pensions by 4,6%", emphasized Mr. Koursaris, who expressed the position that there should be a comprehensive plan of the Government. Since this situation will continue and the problems will worsen, there are two ways, he told the KYPE. One is to invest in the economy the increased revenue collected by the state from indirect and direct taxes, so as to give a boost to the economy. The other is for Cyprus to demand from the EU's Recovery and Resilience Fund more help and support as a Mediterranean state facing problems from immigration policy, concluded the POVEC General Secretary.
Source: KYPE