THE GLOBAL economic downturn and the collapse of the British pound are having an enormous impact on the retired population of Brits in Paphos.
David Cornthwaite, the Chairman of the UKCA in Paphos told the Sunday Mail that the biggest topic of conversation among expats at the moment is the financial crisis.
“The government of Cyprus is saying that we’re OK, but this simply isn’t so. They’re living in fantasyland.” He continued, “The full force of the impact has yet to be felt, but it’s begun already.”
“Two of our members, the Crawfords, are shortly returning to the UK. They’ve done all their sums and worked out that they’re far better off there. They’ve been comparing prices between UK supermarkets and those in Paphos, and they will get substantially more groceries in their weekly shopping trolley in England.”
“Due to a combination of the poor exchange rate from sterling to the euro and local inflation, they’ve worked out that they’re 42 per cent worse off here.”
Brian and Barbara Crawford decided to retire to Cyprus just over two years ago.
“It was a dream to move here, like paradise. We loved the sun, the sea, the atmosphere and the people. The standard of living, before the introduction of the euro, was good. We were well in pocket, in fact I could say we had a surplus on our sterling pensions,” said Brian Crawford.
The pair has decided they’re no longer able to live in Paphos due to the inflated costs of living and are returning to the UK.
“We’ve made the decision to move back to the UK. Our flights are booked for March 11 and we’re in the process of sorting out a container,” said Crawford.
Crawford’s price comparisons have been accrued over a few weeks. He said the differences he’d found were mostly on food.
“My brother in the UK, and I have been exchanging our weekly budget and comparing costs on necessities. The prices in the UK are ridiculously low .For example a box of 160 teabag cost €8 here in Paphos. The same teabags in the UK cost £3.27.”
He continued, “We’ve been delighted with the local vegetables and the quality is superb. In fact, the Cyprus potatoes are a firm favourite, but the prices have now rocketed sky high.”
The couple plans to rent a property close to Witham St. Annes in the UK, whilst keeping an eye on house prices, which are plummeting.
The pair, who rent in Paphos, said they would wait until the British housing market ‘bottoms out’ and then buy a property.
Crawford said, “I was a professional sales and marketing administrator before retiring, and I like to know all of the facts and information. You can’t make an informed decision without facts; information is power.” He added, “I did the same thing when we were moving here. This is why we rented, because I had heard of all the problems buyers were encountering with developers and title deeds.”
Brian Crawford is chairman of the UKCA computer club and the camera club.
“I’ve made good friends here that I will really miss. But this is something we have to do. A lot of my friends are in the same boat, but many of them have to stay here as they own property, which isn’t selling.”
He said his friends will have to start budgeting and favour Cyprus brands over imported ones, which are still a little cheaper at present.
Crawford believes the Cypriot government is living in a bubble.
“People are being laid off left right and centre. It’s going to hit them so hard, and I don’t want to be here when that happens,” he said.
“It’s a real tragedy, but the modern Cypriots are greedy. There are fewer customers, and yet they seem to raise their prices. It doesn’t make sense.”
He believes locals will learn the hard way, and added that young people are unable to buy properties as the developers’ prices are high.
“They target the British and make it attractive to us, selling Paphos as paradise. In turn and the young people blame us for the rising housing costs. But it’s not our fault, it’s the developers.”
Crawford concluded, “It took us some time to mull over the information and come to our decision, but we decided over the Christmas period that we had to move back.
“I would love to be able to move back to Cyprus in the future, but I can’t believe the government will see sense, and as I will be 74 in August, maybe time will run out.”
Currently, there is a 30 per cent differential exchange rate, so put simply, pensioners with one £100 before the crisis, now have £70.
Cornthwaite is lucky enough that, at present his pension is sufficient.
“I came out of a corporate life and am lucky that my pension is still OK. But many people are frightened and don’t know what to do. The UKCA will always do what we can to help, and also can put people in touch with the relevant professionals.”
To help struggling pensioners, the UKCA is freezing their club prices for at least the next 12 months.
“Our costs are rising, but we are trying not to pass this onto the members in the current climate,” said Cornthwaite.
The UKCA Chairman said that he has spoken to many concerned individuals who are unable to sell their houses, and feels the property market in Cyprus is stagnating.
“I know that for the last quarter in Limassol, no properties were registered for capital gains tax. This must surely mean that no re-sale properties were sold,” he said.
More people are eating at home and reducing the number of times they go out a month and cutting back on luxuries. Gardeners, pool maintenance and cleaners services are all being terminated in favour of households doing these tasks themselves.
Cornthwaite added, “Whether people are economically shielded or not, it’s the uncertainty surrounding the crisis which is scaring them. No one knows how deep it is, or how long it will last.”
Expat pensioners are facing real problems if most of their income is in sterling. Whereas working Brits don’t seem to be feeling the pinch as much yet.
“The government need to realise the extent of the problem in Cyprus, and understand the future is bleak in order for anything to change,” concluded Cornthwaite.
Copyright © Cyprus Mail 2009