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16 June 2022 INSIDER • GOAL • IN-CYPRUS • PROPERTY • CYPRUS-IS • CAREER LIKE • GOING OUT • XRYSES SYNTAGES • ACTIVE • PHILGROUP NEWS & nbsp; SOCIETY & nbsp; INSIDER & nbsp; OPINIONS & nbsp; GOING OUT & nbsp; CULTURE & nbsp; SPORTS & nbsp; AUTO & nbsp; GOOD LIFE & nbsp; USEFUL & nbsp; PRINTED EDITION & nbsp;
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ΑΡΧΙΚΗΕΙΔΗΣΕΙΣΠΟΛΙΤΙΚΗΤΟΠΙΚΑΠΑΡΑΣΚΗΝΙΟMEDIAΕΛΛΑΔΑΚΟΣΜΟΣΕΠΙΣΤΗΜΗΠΡΟΕΔΡΙΚΕΣ 2023ΤΕΧΝΟΛΟΓΙΑΣΥΝΕΝΤΕΥΞΕΙΣΧΡΥΣΕΣ ΕΤΑΙΡΕΙΕΣΚΟΙΝΩΝΙΑΕΙΔΗΣΕΙΣΚΥΠΡΟΣ ΤΟΥ ΧΘΕΣΑΝΑΓΝΩΣΤΗ ΕΧΕΙΣ ΛΟΓΟΕΠΙΣΤΟΛΕΣΣΥΝΕΝΤΕΥΞΕΙΣΔΗΜΟΦΙΛΗ ΣΤΟ INTERNETVIDEOSΑΦΙΕΡΩΜΑΤΑADVERTORIALINSIDERΕΠΙΧΕΙΡΗΣΕΙΣΚΥΠΡΟΣBRAND VOICECAPITALFORBESBLOOMBERG OPINIONΠΡΩΤΑΓΩΝΙΣΤΕΣΚΑΥΤΗ ΓΡΑΜΜΗΧΡΥΣΕΣ ΕΤΑΙΡΕΙΕΣΚΑΡΙΕΡΑΑΠΟΨΕΙΣΑΡΘΡΑ ΣΤΟΝ “Φ”ΠΑΡΕΜΒΑΣΕΙΣ ΣΤΟΝ “Φ”ΤΟ ΜΗΝΥΜΑ ΣΟΥ ΣΚΙΤΣΑΟ ΚΟΣΜΟΣ ΤΟΥ TWITTERGOING OUTTHINGS TO DOCINEMAΜΟΥΣΙΚΗΕΣΤΙΑΤΟΡΙΑBAR/CAFETV ΟΔΗΓΟΣΤΗΛΕΟΡΑΣΗΠΟΛΙΤΙΣΜΟΣΚΥΠΡΟΣΚΟΣΜΟΣΚΡΙΤΙΚΕΣΕΚΔΗΛΩΣΕΙΣΠΡΟΣΩΠΑΑΘΛΗΤΙΚΑΠΟΔΟΣΦΑΙΡΟΜΠΑΣΚΕΤΠΑΡΑΣΚΗΝΙΑΕΛΛΑΔΑΔΙΕΘΝΗΑΛΛΑ ΣΠΟΡΑΠΟΨΕΙΣΣΚΙΤΣΟVIDEOSAUTOΝΕΑΠΑΡΟΥΣΙΑΣΗΑΠΟΣΤΟΛΕΣΑΓΩΝΕΣΚΑΛΗ ΖΩΗΥΓΕΙΑΔΙΑΤΡΟΦΗΕΥ ΖΗΝΑΣΤΡΑΧΡΥΣΕΣ ΣΥΝΤΑΓΕΣΣΥΝΤΑΓΕΣ ΣΕΦΒΗΜΑ ΒΗΜΑΧΡΗΣΙΜΑΦΑΡΜΑΚΕΙΑΓΙΑΤΡΟΙΑΕΡΟΔΡΟΜΙΑΛΙΜΑΝΙΑΤΗΛΕΦΩΝΑΟΠΑΠΚΑΙΡΟΣΣΥΝΑΛΛΑΓΜΑΛΑΧΕΙΑAPPSΠΡΟΣΦΟΡΕΣΕΝΤΥΠΗ ΕΚΔΟΣΗ ΠΟΛΙΤΙΚΗΤΟΠΙΚΑΠΑΡΑΣΚΗΝΙΟMEDIAΕΛΛΑΔΑΚΟΣΜΟΣΕΠΙΣΤΗΜΗΠΡΟΕΔΡΙΚΕΣ 2023ΤΕΧΝΟΛΟΓΙΑΣΥΝΕΝΤΕΥΞΕΙΣΧΡΥΣΕΣ ΕΤΑΙΡΕΙΕΣ ΕΙΔΗΣΕΙΣΚΥΠΡΟΣ ΤΟΥ ΧΘΕΣΑΝΑΓΝΩΣΤΗ ΕΧΕΙΣ ΛΟΓΟΕΠΙΣΤΟΛΕΣΣΥΝΕΝΤΕΥΞΕΙΣΔΗΜΟΦΙΛΗ ΣΤΟ INTERNETVIDEOSΑΦΙΕΡΩΜΑΤΑADVERTORIAL ΕΠΙΧΕΙΡΗΣΕΙΣΚΥΠΡΟΣBRAND VOICECAPITALFORBESBLOOMBERG OPINIONΠΡΩΤΑΓΩΝΙΣΤΕΣΚΑΥΤΗ ΓΡΑΜΜΗΧΡΥΣΕΣ ΕΤΑΙΡΕΙΕΣΚΑΡΙΕΡΑ ΑΡΘΡΑ ΣΤΟΝ “Φ”ΠΑΡΕΜΒΑΣΕΙΣ ΣΤΟΝ “Φ”ΤΟ ΜΗΝΥΜΑ ΣΟΥ ΣΚΙΤΣΑΟ ΚΟΣΜΟΣ ΤΟΥ TWITTER THINGS TO DOCINEMAΜΟΥΣΙΚΗΕΣΤΙΑΤΟΡΙΑBAR/CAFETV ΟΔΗΓΟΣΤΗΛΕΟΡΑΣΗ ΚΥΠΡΟΣΚΟΣΜΟΣΚΡΙΤΙΚΕΣΕΚΔΗΛΩΣΕΙΣΠΡΟΣΩΠΑ ΠΟΔΟΣΦΑΙΡΟΜΠΑΣΚΕΤΠΑΡΑΣΚΗΝΙΑΕΛΛΑΔΑΔΙΕΘΝΗΑΛΛΑ ΣΠΟΡΑΠΟΨΕΙΣΣΚΙΤΣΟVIDEOS ΝΕΑΠΑΡΟΥΣΙΑΣΗΑΠΟΣΤΟΛΕΣΑΓΩΝΕΣ ΥΓΕΙΑΔΙΑΤΡΟΦΗΕΥ ΖΗΝΑΣΤΡΑΧΡΥΣΕΣ ΣΥΝΤΑΓΕΣΣΥΝΤΑΓΕΣ ΣΕΦΒΗΜΑ ΒΗΜΑ ΦΑΡΜΑΚΕΙΑΓΙΑΤΡΟΙΑΕΡΟΔΡΟΜΙΑΛΙΜΑΝΙΑΤΗΛΕΦΩΝΑΟΠΑΠΚΑΙΡΟΣΣΥΝΑΛΛΑΓΜΑΛΑΧΕΙΑAPPSΠΡΟΣΦΟΡΕΣ ΕΠΙΧΕΙΡΗΣΕΙΣ ΚΥΠΡΟΣ BRAND VOICE CAPITAL FORBES BLOOMBERG OPINION ΠΡΩΤΑΓΩΝΙΣΤΕΣ ΚΑΥΤΗ LINE GOLDEN COMPANIES CAREER
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Next Previous Publ. Council: Social justice measures not horizontal HOME • INSIDER • CYPRUS • Dimos. Council: Social justice measures not horizontal
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Recommends special attention to public finances due to increased risks, which may be maintained in the long run, recommends the Financial Council, arguing that support measures should focus on small and medium-sized enterprises and vulnerable groups of the population and not horizontally .
READ ALSO: & nbsp; Salary increases of 2.25% are forecast by the Ministry of Finance for '23
Interim Report of the Financial Council b >
The Interim Report of the Financial Council aims to present the assessment of budgetary results and financial planning, including macroeconomic and budgetary forecasts and developments. Macroeconomic developments, external pressures, fiscal policy decisions and measures to tackle inflation are important parameters from which the country's fiscal picture derives.
Particular conditions intensify uncertainty and uncertainty in analyzes and any estimates for the course of public finances and the economy in general are based on a number of assumptions, which, however, can not be judged as safe under the current circumstances.
The estimates given in this report are based on the data and data available until 30 May 2022 and are based on the basic assumptions that:
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; The war in Ukraine will continue but will not escalate
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; Sanctions against Russia may intensify, but their nature and style will not change
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; Fuel prices will stabilize at the end of the third quarter of 2022 but prices on other products will not escalate before the end of 2023
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; Monetary authorities will take monetary easing measures, but will not move to extreme options in order to return inflation close to 2% by 2022
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; The Fed will not raise interest rates on the dollar beyond 4% with an impact on the flow of capital to the US and a slowdown in growth in this economy
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp ; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; The US will not record a recession in 2022
• & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; The increase in food and fuel prices will not translate into a new wave of political unrest in countries that are geographically, politically or economically neighboring Cyprus
The picture of the economy continues to be characterized by increased uncertainty and high risks, but also continued growth at a real pace. The macroeconomic situation is characterized by employment pressures, increased credit risk (especially among small and medium-sized enterprises), consumption pressures and continuing inflation which horizontally affects all sectors of the economy. With these data, a decrease in real GDP growth and an upward trend in unemployment are expected. Trends towards stagnant inflation will continue, but real GDP growth is expected to remain on positive ground. The Treasury Department estimates real growth of 2.7%, an estimate that is considered conservative and realistic, with the Finance Council estimating that real growth will be closer to 2%, given that the above, precarious, labor cases They will not be overturned.
At the same time, the fiscal picture remains stable despite the secondary pressures on public finances, especially in terms of spending. It is noted that, based on existing data, there is a significant increase in some revenues, especially from indirect taxes, while direct taxes are expected to continue to increase as nominal GDP expands.
In general, inflation usually affects the Public Finances through the contraction of GDP which implies a reduction of revenues from direct and indirect taxes, combined with an increase in government spending. However, once nominal and real GDP growth is ensured, inflation alone does not pose a fiscal problem, as government revenues increase to offset increased spending. (Secondly, however, there is an increased risk of future Republic debt issues and borrowing costs.) & Nbsp;
Based on current data and trends, no high primary risks appear & nbsp; Fiscal turmoil and the Fiscal Council considers that the Ministry of Finance currently maintains control over public finances. However, it is noted that the pressures for further fiscal expansion are a significant potential risk, while the risks to the economy continue to be serious in the medium and long term.
We note, in addition, the increased political risk, due to a political pre-election cycle, which must be taken into account. The Council has repeatedly warned against decisions that may be popular but do not achieve their stated goal. We also warn that decisions that are not in line with the medium- and long-term goals of the Republic, such as the green transition and the digital transition, are not in line with Best Practices as they equate to a large increase in fiscal expenditure in the near future. Upward turmoil.
Decisions that reduce emissions costs for large companies, for example, pose a significant risk for the period from 2023 onwards, as well as a disincentive to growth investment and high reserves. liquidity in the economy, which are legitimate under the circumstances, despite the marginally increasing impact they will have on individual price levels.
Such policies are doubly problematic. On the one hand, they mean reduced revenues, which is tantamount to freezing long-term goals, and on the other hand, they increase future government spending needs in order to achieve the same goals that were frozen at cost. Any tax incentives should focus on achieving rather than suspending goals such as the green and digital transition.
We also note that expenditures aimed at maintaining social justice, equality and the protection of vulnerable groups are deemed necessary. We agree with last year's wording of the International Monetary Fund, which we believe is still valid, that the fiscal situation is such, which justifies this choice of the government. On the one hand, the budget deficit and public debt are not currently in a position to prohibit fiscal growth policies. On the other hand, these fiscal expansion policies protect the growth perspective of the economy, boost employment and mitigate the effects of increased pressures on the economy and society.
We reiterate, however, that the margins for fiscal policy is not unlimited and that horizontal measures are contraindicated as ineffective and wasteful, despite their popularity.
Horizontal measures must be avoided with an increased sense of responsibility and discipline from the wider political leadership. The structural characteristics of the Cypriot economy do not preclude the transmission of horizontal measures from large enterprises to households, which may occur in the relevant theory in other economies, but is not found in Cyprus due to the structure of production and distribution of products and services. The most important mechanisms for transmitting such policies, starting from Manufacturing and Industry, do not exist in the Cypriot economy to the extent that they can be key working issues in the conduct of monetary or fiscal policy. & Nbsp;
The current picture of the Economy predisposes for increased difficulties between households and small and medium enterprises. However, it seems that GDP will remain on positive ground, despite the pressures it receives, while a further recovery is expected in 2023, both in growth and in the reduction of unemployment, while a de-escalation in price levels will strengthen the real Cash Household income.
