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Talk is cheap, everything else is not

Ideas@TheCentre – The CIS newsletter (Sydney), 3 June 2011

It was in a busy shopping street in the city centre of Lübeck where I spotted them. Glowing in bright yellow, the fruits at the market stall looked exactly as I remembered them from Australia. But when I saw the price of 79 Euro cents per kilo (approximately AU$1), I wondered whether they were really bananas.

I am currently on vacation in Germany. As usual, it’s a trip down memory lane to the country where I grew up. But this time, I am more puzzled than ever before. Though I always knew Germany as a country of penny pinchers, it had never struck me as cheap as it presents itself to visitors from Australia today.

And it’s not just bananas. Swiss chocolate bars, offered at a premium price in Australia, are selling dirt cheap at discount shops. You can stay at five-star hotels at rates that would just about get you a grubby motel room in East Maitland. And the other night, I had a large beer at a local microbrewery for the equivalent of $2.50. In Germany, it seems to be happy hour all year round.

Part of the phenomenon may be explained by the Aussie dollar’s dazzling exchange rate and the Euro’s ongoing crisis. However, that’s not the full story. Germany may be exceptionally cheap, but Australia has become very expensive.

Nowadays, Australian politicians seem physically unable to deliver speeches without paying homage to either hard-working or forgotten families. Yet from this lip-service, little concrete action ever follows.

Bananas are a case in point. After cyclone Yasi destroyed three-quarters of Australia’s banana crop, prices skyrocketed and may soon reach up to $17 a kilo. But even this extreme price increase was not enough to loosen restrictions on banana imports from other countries.

Tragic as the cyclone disaster was for Australian banana growers, the world market price for bananas has barely budged, as German prices demonstrate. Germany of course does not grow bananas and so there is no need to protect local farmers.

Talk is cheap in Australia. Everything else is not. I better enjoy my affordable bananas while I am still on holiday.

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