Greece: Cost of living crisis hits ordinary households hard

"The money I now spend in the supermarket to buy three day's worths of food for my family, last year was enough for an entire week's worth of groceries," Anna Petropoulou told DW. For the 49-year-old Greek mother of three, visiting the supermarket is full of unpleasant surprises as the cost of living soars. Together with her husband, Petropoulou earns fairly well by Greek standards, and the family lives in a condo. But the dramatic rise in food and fuel prices is forcing them to carefully watch their spending — it is a bit like a return of the 2010 financial crisis.

Today, a 500-gram bag of coffee costs at least €2 more than last year. Milk and yoghurt are twice as expense, most kinds of bread and eggs costs about 30% more. Even feta, a popular Greek cheese, is now €12 a kilo, that's €3-4 euros more than six months ago. "I feel poor when I visit the supermarket," Petropoulou said. While she thinks Greek Prime Minister Kyriakos Mitsotakis is doing a good job, she gets angry when he claims Greece is making economic progress. "Apparently, I am living in a different country," she said.

Mitsotakis is convinced Greece is on the right track. "Greece is now one of the fastest growing economies in Europe, with increasing employment, falling inequalities and improving public finances," he said at a recent meeting of the governing council of the European Central Bank (ECB) in Athens with ECB President Christine Lagarde in attendance. "Staying in the euro was not easy, but Greece is undoubtedly a story of success," he added.

Anna Petropoulou is seeing little of that success in her day-to-day life. She recently got a wage increase, for which she waited a long time. But the steep inflation means she is seeing no real increase in purchasing power. According to Greek statics bureau ELSTAT, food prices rose by 9,4% in September. And Eurostat found that overall inflation rose by 3,9% in October — surpassing the average Eurozone rate.

Rising costs hurt consumes and traders

"I used to buy fruit and vegetables from the weekly market because everything is cheaper and the quality is right, but now prices there are very high," Katerina Kefala, a teacher, told DW.

Statistics show that the cost of vegetables rose by 17,7% in September, with fruit 13,9% more expensive. Kefala, who earns about €1,100 per month and cannot expect a wage increase anytime soon, is struggling to make ends meet.

Market vendors are struggling, too. Greece endured a very hot summer and in September half the country was inundated due to heavy rainfall. That diminished the quality and quantity of the harvest, with many types of fruit and vegetables scarce and accordingly expensive. The high cost of petrol, currently at 2€ per liter, only drove up prices further. Customers are struggling with the higher prices and buying less and less. And traders cannot afford to raise prices any further but are seeing their profits shrink. It's a vicious circle.

Greek supermarket chains, meanwhile, are seeing their revenue grow, although customers are turning to cheaper brands. And while consumers are cutting costs, they simply cannot avoid buying everyday products such as toiletries or detergents.

Katerina Kefala is always on the lookout for special deals, but she still finds many products on offer are still far too expensive or of poor quality. The teacher is very conscious about when she buys what. "I was never was good at planning, but now I'm forced to plan everything," she told DW. Kefala makes sure she doesn't have to buy new detergents and cleaning products as well as olive oil in one single month, as this would exceed her budget.

Olive oil becomes luxury item

The price of olive oil has skyrocketed, in particular. Olive oil is a Greek staple, which is used in many of the country's dishes. But it has become a luxury good of late, with prices climbing week by week. One year ago, a liter of average quality olive oil cost €4,80 — today, that same oil will cost upwards of €10, or even €11, depending on the supermarket. This is olive oil produced from the 2022 harvest. As this year's harvest is expected to be poor, prices will likely rise even further, with a liter of oil retailing for up to €15. An average Greek household of four, for context, consumes about 60 liters of olive oil per year.

It comes as no surprise that recent surveys find Greeks worry most about these dramatic price increases. A survey published on October 31, 2023, by the Pulse institute found that almost nine out of ten respondents were "very" (63%) or "fairly" (23%) concerned about the high cost of groceries. Almost half of those interviewed said they are most worried about the cost of buying groceries for their family.

Although the Greek government has long been aware of these issues and sought to take counter measures, it has only been moderately successful, as the soaring inflation shows.

To help consumers, Greek authorities have drawn up a list of 51 basic items such as rice, milk, yogurt, spaghetti, pulses, flour, toilet paper and soap. This list is sent to every large Greek supermarket by the economic ministry, obliging stores to clearly mark out the most affordable of these products so consumers can find them. Greek supermarket with a turnover of €90 million are obliged to implement these measures, whereas smaller ones can choose to participate.

This article was originally published in German.