Spending in Turkey and north rises 8.1% in Jan-Feb

Spending by Greek Cypriots in northern Cyprus and Turkey using credit and debit cards rose by 8.1% In February to EUR 1.35 mln, according to JCC Payment Systems, down from an increase of 22% in January.
Spending in northern Cyprus alone reached EUR 998,044 in January-February. There is no strict comparison with 2010, because JCC has regrouped the data so that all spending in Turkey is shown in one place, instead of grouping Attaleia (Antalya) with “Occupied Areas and Attaleia”.
However, if spending in the north on entertainment largely reflects spending in casinos, which are banned both in the south and in Turkey, then there appears to have been a continuation of the decline witnessed in 2010.
Entertainment spending in “Occupied Areas” was EUR 177,307 in January-February 2011 compared with spending of EUR 433,144 in “Occupied Areas and Attaleia” in January-February 2010.
In 2010 entertainment spending in “Occupied Areas and Attaleia” fell by 50.9% compared with the year earlier, even while other spending rose.
The biggest expenditure in the north is now on hotels, with spending of EUR 367,051 in the first two months of the year.

Turkish Cypriot spending up 15.4%
Meanwhile, spending in the south by Turkish Cypriots (cards issued by Turkish banks) rose by 15.4% over the year earlier to EUR 2.85 mln.
Of this total, EUR 650,858 was spent on supermarkets and EUR 518,492 went on clothing.
This is despite reports of an economic crisis.
Or if clothes and food are cheaper in the south it could be precisely because of the crisis.
Owing to lack of recognition as well as high import taxes, imports to northern Cyprus carry a premium. This, combined with weak competition make many good more expensive in the north than in the south, even though incomes in the north are only around 40% of those in the south according to the latest data.

Fiona Mullen
www.sapientaeconomics.com