Fretting over unrelenting pay cuts, tax hikes and slashed pensions that have worsened the country’s six-year recession and created a record 26.8 percent unemployment rate, Greeks have slowed spending to a standstill are are the most despairing consumers on the planet.
That’s according to a recent survey by Nielsen research company that found the consumer confidence index in the country had dropped to 35 points in the last quarter of 2012.
That is the lowest level among a total of 58 countries surveyed and 11 points lower than the same period last year in Greece. Four out of 10 Greeks told the same survey that they no longer have any disposable money left after covering their basic needs, which is the highest rate ever recorded in Greece and the biggest in the October-December period in Europe. A year earlier (in Q4 2011) that rate had stood at 34 percent and in Q4 of 2010 it had been at 25 percent.
The newspaper Kathimerini noted that even in cases where consumers have money left to spend, it goes mostly toward the payment of loan and credit card installments (31 percent) or savings (22 percent). Only a very small number of consumers use their disposable income for entertainment, vacations and buying clothes, which has led to a big drop in the food catering, domestic tourism and apparel store sectors.
Supermarkets, which kept high prices for a long period of time despite the crisis, have panicked over a big drop in sales, a loss of some 500 million euros ($667 million) in 2012 and have responded with waves of offers and sales, including free products and deep discounts on many items, but Greeks are still reluctant and have cut back on all but essential foodstuffs and turning to bargain-priced products.
Finding or keeping a job constitutes the greatest concern among Greeks, which, at a rate of 44 percent, is among the highest in the world. The state of the economy ranks second, at 38 percent, debts are third at 26 percent and the increasing level of utility bills are fourth, on 21 percent.
Shrinking disposable incomes combined with insecurity have led to a change in Greeks’ shopping habits, with 77 percent stating they have curtailed spending on entertainment outside the home, 67 percent saying they choose cheaper commodities (mostly own-label supermarket products) and more than half (54 percent) say they have cut down on fuel and electricity.
The same survey found that the country with the most optimistic citizens is India, with an index reading of 121 points, followed by the Philippines with 119 and Indonesia with 117. Asia generally appears to be the most optimistic continent on the planet, with Europe being the most pessimistic. In total, the global index came to 91 points in the last quarter of 2012, dropping by one point from the previous quarter.