Rome

Italians on 'forced diet' due to economic crunch

Country needs more spending power, say consumer groups

Italians on 'forced diet' due to economic crunch

(by Kate Carlisle) Rome, July 24 - Italians have been on a "forced diet" since 2007, eating less and less due to the long-running economic crisis, consumer group Codacons said on Wednesday. The group was commenting on the latest figures from Italian statistics agency Istat that show an "uninterrupted decline in sales in the food industry since 2007". Italy's retail sales increased in May by 0.1% with respect to April 2013, but fell year-on-year by 1.1%, the country's statistics agency Istat said on Wednesday. May figures for food sales were up slightly, 0.6%, while non-food goods dropped 0.2% from April. Any increase in food sales "is just an optical illusion," Codacons said. The Italian table consists of "essential" and absolutely "low-cost" food, Farmers Confederation CIA said on Wednesday. In fact, the sales of foodstuffs in the first five months of 2013 dropped by 1.6%, according to Istat. Not only have 62% of households reduced food purchases, but 6.5 million homes shop in discount and low-cost markets to cut expenses during the long-running crisis. To offset the drop in retail spending, large supermarket chains have increased promotions and special offers, up by 9% since 2008, CIA noted. Despite offers, Italians have cut beef and veal purchases by 5% and are eating 3% more chicken - a cheaper alternative. Fresh fish consumption is also down by 5% and fresh milk purchases are down by 4%, substituted by the more economical long-life milk, up 5%. Alongside reduced spending are unemployment figures, which reached a record high of 12% in May, that paint a grim picture in Europe's third-largest economy. The real problem to solve in order to boost employment in recession-ravaged Italy ''is the buying power of households and re-launching demand'', the presidents of leading consumers' groups Federconsumatori and Abusdef said. Rosario Trefiletti and Elio Lannutti in particular called for tax cuts - on controversial housing property tax IMU, VAT and a regional taxation on labour - ''and the start of Keynesian policies of investments aimed in particular at innovative sectors''. According to the latest data by the national observatory of Federconsumatori, consumer spending is expected to drop by 50 billion euros, an estimated 2,161 euros per household, in the 2012-2013 period. In their joint statement, Trafiletti and Lannutti slammed an ongoing debate on labour reforms, including greater contractual flexibility, saying the central issue was instead that ''companies will start hiring again when they will resume selling goods and services''.

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