Prepare for Cyprus rip-offs

 Prepare for Cyprus rip-offs

WARNINGS were issued yesterday that consumers should brace for the knock-on effects of the 6.96 per cent electricity hike as the price of goods and services rise, and profiteers may take advantage.

The warnings came at the same time as an announcement that water prices would go up as of next year, possibly adding as much as €6 or €7 to the bill for a family of four. The water hike is not linked to the electricity charge, Agriculture Minister Sophoclis Aletraris said.

Commenting on the electricity hike, Employers and industrialists Federation (OEV) director general Michalis Pilikos yesterday warned:  “Unfortunately it will result in an increase in the price of products, especially where competition does not operate effectively.”

He said this would inevitably lead to higher inflation and also have a negative effect on exports as it would damage the competitiveness of Cypriot products.

Inflation in Cyprus stood at 2.9 per cent in August, higher than the eurozone average of 2.5 per cent.

The electricity rise was imposed in a bid to cover the costs of the semi-state electricity authority (EAC) following destruction of its main power station in the July 11 blast.

Pilikos said the rise could not be avoided and inevitably consumers would have to foot the bill either way, even if the government decided to foot the whole bill.

“The result is the same because the state would have to find the money from somewhere,” Pilikos said.

Consumers however are expressing concerns that some businesses will exploit the hike.

Pilikos said no one could guarantee that profiteering would not occur, but “competition and efforts by businesses to secure a share of the market” led him to believe there would not be such practices on a widespread basis.

“On the contrary, my information says that many businesses will try to absorb the increased cost as much as possible and this will be our urge,” Pilikos said.

Petros Markou, chairman of the consumer association, voiced hope that OEV’s plea would be heeded.

“We are certain that many businesses, hopefully not all, will start raising prices of basic consumer goods and this will have other dire effects on consumers and the economy in general,” Markou said.

Markou said there were other ways to pay the cost, referring to a suggestion tabled by EAC workers for it to be taken out of the VAT imposed on electricity bills.

Andreas Panorkos, the head of EAC trade union EPOPAI, said they had proposed the cost to be  read more here courtesy Cyprus Mail

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