Euro price hikes anger Germans

BERLIN, Germany -- German ministers, retailers and consumer groups are meeting to discuss whether the introduction of the euro has led to hidden price hikes.

The meeting is aimed at restoring faith in the currency introduced in 12 European Union member states on January 1.

Shoppers and consumer groups have accused retailers of manipulating people's currency conversion ignorance to bump up prices.

Complaints of increases on products, ranging from carrots to car batteries, have been taken up by Germany's newspaper Bild in a campaign against "euro gougers."

RESOURCES Euro: Ready or Not?

The government, which faces tough elections in the summer, has called a meeting of representatives from various industries along with unions and consumer groups to discuss the matter.

Maria Heider, spokeswoman for Germany's Finance Minister Hans Eichel, told The Associated Press: "It would be a bad government that didn't react to the feelings of the population."

Retailers say price rises, which have doubled in some cases, are the result of the cold winter and not the euro.

The European Commission has estimated that the introduction of the euro may have increased prices overall by up to 0.16 percent, but the low level may be because items that have seen price rises are not included in the index calculations.

The matter has become such a talking point that the euro has earned the nickname "teuro," a play on the German word for expensive "teuer."

Examples of price rises include the cost of a Snickers bar jumping from 51 euro cents to 70 euro cents and a round of drinks leaping from 11 euros to 20 euros.

But it is not just Germans who are complaining about rises. Spaniards and Italians are as well.

In Spain, the private Confederation of Consumers complains that the government -- having urged businesses to avoid using the new currency to mask price hikes -- itself allowed dramatic rises in transport fares, which it had the power to regulate.

In Italy, the Codacons consumer-rights group lists dozens of increases, including a 10.3 percent average increase in insurance policy costs and 29 percent on Milan bus tickets.

Italian Industry Ministry official Francesco Piccarreta said some of the price increases cited by consumer groups were "not necessarily linked to the introduction of the euro," but might be normal New Year adjustments.

"Each country is bad," said Caroline Hayat, a Brussels-based spokeswoman for the European Consumers' Organisation, grouping associations across the continent. As people's complaints go unaddressed, "they are getting more upset."

A February survey by the organisation recorded complaints about hairdressers, bakeries, car parks, restaurants and cinemas, many of which Hayat said could only be explained by "unscrupulous retailers using the euro to increase prices."

One German official who will not be attending Friday's meeting in Berlin will be Economics Minister Werner Mueller who attacked the summit for being "to some extent a show for the people."

Hubertus Pellengahr, spokesman for the Association of German retailers, said: "What are we supposed to make of an event ... whose point the economics minister doubts?

"It would be the end of the market economy and the end of competition if the state set prices."