November shows inflation running high in the Balearics

According to a report published yesterday by the National Institute of Statistics (INE), the monthly increase in prices, the second highest in Spain after Navarra, is attributable to the strong upturn in the cost of clothing and footwear (7 percent), considerably higher than in the same sector in the rest of Spain (2.9 percent at a national leval), and in spite of the fall of six decimal points in transport.

The Balearics has accumulated an inflation rate of 3.2 percent in prices in the first eleven months of the year, a rise which has emerged particularly out of the lingering negative effects of transport costs (7%); hotels, cafés and restaurants (5.2%), Taking the country as a whole, prices rose by 0.2 percent, putting the accumulated inflation rate so far this year at 3.3 percent, and the year on year rate at 3.5 percent.

The IPC rose in 44 provinces of the country, and only dropped in Guipuzcoa (-0'2%) and in Cuenca (0.1%); no change was recorded in Badajoz, Palencia, Tarragona and Toledo.

During November, prices rose most notably in Salamanca (0.9%) and Jaen (0.8%); followed by Navarra (0.6%); Asturias, the Balearics and Santa Cruz in the Canary Islands, (3% each); Alicante, Ciudad Real, Pontevedra, La Rioja, Sevilla and Zaragoza (0.4% each); and Alava, Albacete, Barcelona, Burgos, Granada, Lerida, Malaga, Segovia and Valencia (0.3% each).

Prices rose at the same level as the national average (0.2%) in Avila, Caceres, Cantabria, La Coruña, Guadalajara, Huesca, Leon, Lugo, Murcia, Las Palmas and Teruel; whilst a 1% growth was registered in November in Almeria, Cadiz, Castellon, Cordoba, Gerona, Huelva, Madrid, Orense, Soria, Valladolid, Vizcaya and Zamora.

So far this year, prices rose in all provinces, notably in Gerona, Huesca and Leon (4% each), but to a lesser degree in Las Palmas (2.3 percent) and Granada (2.6 percent).

In the last 12 months, inflation rates were up in all provinces, the most marked cases being in Gerona (4.3%), and Barcelona and La Coruña (4% in each).

At the other end of the scale, the least inflationary trends over the last 12 months were registered in Las Palmas (2.6%); Granada (2.7%); and Badajoz and Valladolid (2.9%).

The Workers Commission (CCOO) claimed yesterday that the year-on.year inflation rate registered in November (3.5%), continues to be “very high”, generating costs which “burden” economic growth such as increased payments made to pensioners to compensate for inflation.

If, said the CCOO, the central government cost of living index forecasts for 2004 (2 percent), had been correct, compensatory funds would not have had to be used to balance out price increases.

The money, claimed the Workers Commission, could have gone to good use elsewhere such as raising the minimum pension level. It pointed out that sharp price increases oblige Social Security to take on an additional annual financial burden of 950 million euros to avoid a loss of pensioners' buying power.

As it stands at present, say the Commission, the raising of the minimum pension level agreed for the coming year, at a figure of between 5 and 6.5 percent, implies an additional cost of 388.43 million euros.

Similarly, for CCOO, the “excessive” growth of prices throughout the course of 2004 continues to “feed” the problem of competitivity of goods and services, which, the Commission claims, have become 15 percent more expensive that the European Community average since 1993.

This “deterioration”, says CCOO, becomes “clearly” reflected in a deficit balance, which at the end of the year will be 5 percent higher than the Gross Balearic Product (PIB), a percentage surpassed only by the United States.