A UK survey released last week predicted Britons would spend 10.6 billion pounds less this year on Christmas than they did last year as a direct result of the global financial crisis.
It is a tale of festive doom and gloom repeated throughout the United States and elsewhere in Europe.
Yet the large department stores here remain optimistic that Cyprus will continue to buck the international economic trend as consumers shop for Christmas.
“We are observing developments in the economy and we don’t see any change in people’s attitude regarding the credit crunch so far;” said marketing manager of the Mall of Cyprus, Nektarios Vilanides. “Last year half a million people visited the Mall just for the month of December and we expect this number to increase this year.”
Megaland, the computer and electronic chainstore is equally upbeat. “We are expecting a sales increase during the Christmas season. I don’t think the financial crisis has really affected us,” said manager Paris Gaidajis. “People have already started buying Christmas presents from us. We sell computers, electronics, figures, gadgets, games and consoles, but it’s mostly the gaming industry that is at its peak during the Christmas season.”
But beneath the official optimism, there are signs that shops are preparing for more cautious spending. Debenhams department store has already held a pre-Christmas sale, as has Tag while Marks & Spencers is offering three for the price of two deals on a wide range of products.
It is a move that has angered the Small Shopkeepers’ Union (POVEK) which argues it poses unfair competition to smaller shopkeepers. “Big department stores have started advertising sales at the scale of 30, 40 and even 50 per cent. POVEK has contacted the Commerce Ministry and in our meeting with Commerce Minister Antonis Paschalides he confirmed that this is illegal and whoever advertises sales will be reported. The Ministry will be monitoring all the shops,” said general secretary Stephanos Koursaris.
“The winter sales season is in the first week of February and the summer sales season is the first week of August, and they both last a month. No one is allowed to advertise that they have sales whenever they want.”
Koursaris believes that consumers will be more cautious this year.
“Our prediction is for consumer restraint as regards non-basic goods during the Christmas season,” he said, adding that consumption on basic goods was unlikely to fall.
It is a view shared by local economists. “Although Cyprus is not yet affected by the crisis, it is expected that people will be more cautious with their spending over the holidays and there will be fewer trips abroad this year,” said Costas Apostolides.
He said there was unlikely to be a repeat of last year’s “ridiculous advertisements” offering Christmas loans for shopping with five years to pay them back. “This was absurd. People should stick to a budget to carry out their shopping and not splash out on credit.”
The general mood on the street does appear to be one of gentle belt tightening. “I will exclude some friends, colleagues and even some close family members from my Christmas gifts list because now they are an additional ‘luxury’. I really can’t afford to be generous this year,” Marilena Andreadi told the Sunday Mail.
“I will not be buying many Christmas presents this year. If I do end up getting them, they will be just for very close family members and just something small and symbolic, just to maintain the custom and tradition,” said Maria Tsiatini, 27, a bank customer service officer.
