In the 16% inflation has soared in the Poland, according to official data. This is the highest percentage of the latter 25 years old. A walk to the market paints an even more disturbing picture: Vegetables, fruit, sausages, yogurts, packaged soups and other basics food items have become unattainable for low-wage earners. Agnieszka, owner of a grocery store in Warsaw. As he says, “official figures say 16%, but when I see the food here I think inflation has gone to 100%. The prices of dairy products, flour, sugar, oil are particularly high.”
Agnieszka has one of countless Polish “Delicatessen». It is not about our well-known “Delikatessen”, for luxury goods. In Poland this name has been established for the neighborhood grocers and grocers, small businesses that once sprouted up in every neighborhood. Today a small business cannot compete with the supermarket chains – and the discounts -. And yet, there are customers who will always look for the neighborhood store. “Mrs. Halinka comes every now and then,” says Agnieszka. “She is retired, has lost her husband and lives on very little money. He will always owe something at the end of the month…”
“Locks” on neighborhood shops
Delikatesy has always been the easy solution for small, everyday purchases. Many of these businesses are closing down as they cannot keep up with rising energy costs, rents, wholesale prices. More than 3,500 “padlocks” are recorded in the first half of the year. In the center of Warsaw, many express concern about the coming winter. “I’m afraid,” says a lady. “Inflation is everywhere, but the wages they don’t go up and already today I buy fewer things with the same money.” “I see great precision in food,” says another. “We now want twice as much money to buy the same amount. We used to go out to eat once a week, but today that’s considered a luxury.”
Is Putin really to blame?
For the prime minister Mateusz Morawiecki, main reason for the rise in inflation is its invasion of Russia in neighboring Ukraine. The Polish government is trying to put a brake on the increase in prices, reducing, at least temporarily, the VAT in basic foodstuffs, fuel and electricity. The head of the central bank is optimistic Adam Glapinski, noting however that it will take time to beat inflation. “Despite the good state of the economy, we have a high rate of inflation,” says Glapinski. “We will fight inflation, but it will take about two years. We proceed with careful movements, because we want to treat the patient and not exterminate him”.
This week the central bank of Poland proceeded with another interest rate increase, the eleventh since the crisis began. Today the prime rate ranges at 6.75%. “Precious money” further burdens the economy and especially floating rate borrowers. Many economists point out, however, that high interest rates are not going to fight inflation when at the same time the government is handing out pre-election freebies.
Agnieszka does not have much hope for the future. In her quest to survive, she has already found a second job, as a nurse, for the hours she is not working at the grocery store. And if this situation continues, he will prefer to change his profession and keep only the job at the hospital. “If we’re working in the store just to pay bills, then we better shut it down,” he says.
SOURCE: DEUTSCHE WELLE