Slovenia: service sector worst offender on Euro price hikes

Photo: European Commission

Undoubtedly one of the achievements of the EU is its common currency - the Euro. The newest member of the Euro-zone is Slovenia which took up the currency on the the first of January this year. Slovenes suspected that some businesses used confusion over exchange rates to inflate prices and the Consumer Protection Office in Slovenia has confirmed this, saying the services sector has been the worst offender.

Photo: European Commission
Price monitoring suggests what official consumer price statistics have shown. There were more price increases following the adoption of the euro among providers of services than among retailers. According to its own basket of goods, the Consumer Protection office found that 25% of the goods were cheaper, 39% remained unchanged and 36% went up in price.

But what do consumers in Slovenia think about the changes in prices? A young woman shopping in Maribor says:

"I think the prices have risen a little bit, maybe not so much in the supermarkets but for examples gas bills, electricity bills, also restaurants for example. If you go out the food and the drinks are quite more expensive than they used to be and also maintenance bills for houses buildings this has also risen, definitely."

According to the Consumer protection office there was a marked difference between prices of goods and services: the prices of only 35% of goods went up, while 50% of services were more expensive in the period between February 2006 and February 2007. While the price of many a service has gone up, food in Slovenia is by general cheaper. However, not everyone in Slovenia seems to make the same experience as the statement of this women shows:

Photo: European Commission
"I think that the price for electricity, petrol and fuel oil have not gone up that much, I think that the companies somehow had to stick to exchange rates from Slovene Tolar to Euro. But I think that prices have risen with smaller things, or smaller private shops, markets. I believe that it is necessary to go to several supermarkets and shops in order to compare prices. It is also a fact that we still can not fully grasp how much a euro is actually worth, we still look for the prices in Slovenian Tolars and I think that this will go on for a while."

In its latest "black list" of unwarranted price hikes, the office includes bars and restaurants, driving schools, hair dressers, car washes and providers of sports, cultural and health services.

The Consumer Protection Office will push ahead with the Pricewatch project especially since the 12 euro members that adopted the single currency before Slovenia witnessed a second wave of price increases several months after the adoption of the currency.