HIGH STREET BLUES GRIP MAJORCA'S RETAIL SECTOR

PALMA
THE credit crunch and downturn in consumer confidence is not only hitting retailers in Palma but also those in non-metropolitan areas of Majorca.
Shops are closing down all over the island and, according to the island's association of small shopkeepers, retail activity last month was lower than during March last year.

Apparently, after a poor winter sales season, a growing number of retailers are seriously considering their options as sales continue to fall with 79 percent of Palma traders claiming that last month's sales figures were down on March 2007, a claim echoed by over 80 percent of the retail sector in 51 of Majorca's towns and villages. Retail sector experts and sources for the association of small shopkeepers said yesterday that the situation is even more alarming because last month not only marked the start of the new Spring/Summer fashion season but also included the Easter holidays - but retail sector trade continued to fall nevertheless.

And March's trading figures have only served to complicate matters in the retail industry after February's sales figures were the worst for the previous seven months.

The simple fact that people have less disposable income this year after a winter of runaway inflation and rising fuel prices is being blamed for the decline in consumer confidence and consequent drop in trade by the association of small shopkeepers.

However, it does not have a simple solution and can only hope that inflation will start to level out soon, that the tourist season will be a healthy and high-spending one and that foreign investment in the Balearics recovers.