Christmas shopping plunges alongside Cyprus economy
Nicosia's main shopping artery Makarios Avenue has strung up its
Christmas lights but many stores have pulled down their shutters while
others are practically empty, reflecting Cyprus' poor economic state.
Malls on the outskirts of the capital are still thriving, but many
Cypriots fear the entire Mediterranean island, exposed to debt-ridden
Greek banks, will follow in Makarios Avenue's footsteps before too long.
“A few years ago you'd have to pay up to 500,000 euros ($660,000) in
key money to set up shop on Makarios. Now, next to nothing,” said
Christos Styliou, owner of a sports store and a games shop.
Styliou's revenue has plummeted 60 percent in a year, and he has had
to let most of his staff go, make his own sales and deliveries, and keep
stock at home so as not to pay for storage.
“Many of our clients lost their jobs, some had their salary cut by
half,” said veterinarian Georgios Gakos whose clinic is located in an
upmarket area of the capital.
“One who was coming once a month (to groom his dog) now comes just
for the annual injections.” Dean Millard, a British craftsman who moved
to Cyprus 26 years ago, owns a second-hand shop.
“People come to try and sell their furniture,” he said.
“The Cypriots are too proud to say it's because they need the money,
but I know they do. And I can't help them. The only second hand things
that sell now are appliances like fridges and washing machines.” Millard
has also had to fire staff and his store barely breaks even on its
expenses.
He tried to extend his bank loan for his business, but with interest
rates of 10.5 percent, he decided to borrow money instead from family.
A banker, requesting anonymity, told AFP that many clients were
asking for loan extensions but these could not always be granted because
of the decline in the value of assets such as real estate.
“A flat worth 100,000 euros ($130,000) before is now worth around
70,000,” she said.
The country has seen 5,000 small- and medium-sized businesses fold in
the past three years, according to Alekos Tryphonides, a member of the
centrist Diko party and a civil service union leader.
Unemployment has leapt to 12 percent of the working age population,
without counting thousands of immigrant workers or illegal aliens.
Last week Cyprus's biggest supermarket chain Orphanides, swamped by
debt, went into receivership, threatening the jobs of hundreds of its
employees and suppliers.
And in the public sector, 72,000 civil servants may in 2013 see a 15
percent cutback in their salaries, already frozen this year. The
government has even had to draw from pension funds just to afford
December's payroll.
VAT and tax on cigarettes and fuel are increasing, as has the cost of
electricity since an explosion in July 2011 that destroyed the island's
main power station.
Many of Cyprus's inhabitants talk of emigrating, saying how a friend,
a cousin or a neighbour has already gone to Australia, Germany, Russia.
Greece, however, is no longer an option.
AFP |