Greek Christmas Sales Crash, More Stores Set to Close

ATHENS – Hopes by retailers that cash-starved Greek would open their wallets and spend what’s left after an avalanche of pay cuts, tax hikes, slashed pensions and scores of thousands of layoffs as the country tries to stave off bankruptcy were dashed with a report that Christmas sales fell more than 30 percent, the worst performance in decades, increasing the likelihood that many more stores will join the ranks of more than 100,000 that have closed.
With consumer confidence collapsing amid fears of more austerity, Greeks slowed and even stopped spending for the holiday, the National Confederation of Greek Commerce (ESEE) retail federation said. “Nine out of 10 Greeks are less generous, not out of choice but out of necessity” ESEE said. “Retailers endured a Christmas gloom that chipped away any optimism they had before the holidays.” The sharp drop in sales came despite widespread discounts by retailers in the run-up to Christmas.
With a deep recession now in its fourth year with the prospect of many more years of a reduced lifestyle, Greeks took to spending only on survival items for many. Especially damaging was a second income due this month that wiped out the reduced Christmas bonus for most working class Greeks. Clothing and footwear sales dropped 40 percent, electrical goods by 30 percent, and sales in the food and drinks sector by 15 percent compared with the same period last year, ESEE said.
In England, a headline in the Times read The Greeks Do Not Do Christmas This Year as pessimism prevailed and fear for the future had Greeks hunkering down and hoping to ride out a storm that for many seems to be permanent, with Europe’s highest rate of increase in suicides and homelessness and scary reports that many people put on the streets by the austerity measures are not eligible for benefits because they owe the government for heavy taxes they could not pay so some have taken to living in caves on Philopappou Hill near the Acropolis, the fabled site of ancient Greece’s glory and democracy. Meanwhile, Finance Minister Evangelos Venizelos, who took to imposing waves of taxes on workers, pensioners and the poor, has a list of 6,000 tax evaders who owe the country $60 billion he won’t release and they refuse to pay. That comes as the think tank ELIAMEP reported that tax cheats, many of whom continue to evade payment with impunity, cost the country more than $17 billion a year.
Even discounts of up to 70 percent couldn’t lure terrified Greeks into the stores as austerity and taxes took their toll this Christmas, ESEE said. Besides the taxes, which included a second property tax, Greeks in December were required to pay big increases in circulation passes to operate vehicles, which led to 400,000 turning in their license plates so far, car insurance for many, and annual oil bills for renters. Vassilis Korkidis, head of the ESEE, said, “Initial estimates from all over Greece suggest disappointing sales, with clothing and footwear experiencing a 40 percent reduction, electrical and electronic goods 30 percent, cosmetics, books and gifts 20 percent, and even food and beverages falling by 15 percent.”
The newspaper Kathimerini reported that what little money was left over went to pay the second installment of the emergency property tax, the second installment of the emergency income tax and other bills. The newspaper Ta Nea reported that there has been a dramatic increase in the number of people going to soup lines, standing in queues not seen since the starvation days of World War II, although rich areas such as Kolonaki saw affluent people dining and shopping as usual as they have continued to prosper.
Greece is surviving on a series of $152 billion in emergency rescue loans from international lenders who demanded the austerity measures so that they, mostly French and German banks and the International Monetary Fund would be paid back, and a coalition government is negotiating a second bailout of $175 billion that includes writing off 50-65 percent of the debt as the government said it can’t afford to pay but is asking its citizens to do so.