The answer to the current challenges of the Cypriot economy lies in our new development model, said on Tuesday afternoon the Minister of Finance, Konstantinos Petridis, noting that in the current geopolitical instability, Cyprus is perhaps the best destination in Europe for the development of new businesses. p>
Mr. Petridis, who was the keynote speaker at the IMH conference in Limassol, on “Europe in Crisis: Dynamics and Impact on the Cypriot Economy”, stressed that we are going through “strange and dangerous times” and at this stage, the The negative effects of the war on the European and Cypriot economies are difficult to assess. At the same time he pointed out that the war in Ukraine has brought new companies to the island, assuring the support of the government.
In his speech, the Minister of Finance expressed the position that he does not expect He returned to normalcy soon and said that one sector that was certainly affected was tourism, but noted the efforts made to fill the gap created by the Russian market.
In addition, he continued, to some extent the service sector for Russian companies in Cyprus was affected, but in the banking sector does not expect much impact, since in recent years there has been a decrease in Russian deposits, which today they reach only 3.8% of the total deposits in Cyprus.
The biggest risk for all European countries is in the increase of inflation, the Minister of Finance underlined, predicting that it is very likely that there will be a tightening of the monetary policy in the near future, increases in lending and debt service, lower revenues from the slowdown in growth rates but also increasing spending to mitigate inflation costs.
The challenge for European economic policy, he added, will also be prices in the fields of energy, food and building materials, as well as the implementation of the Green Agreement, noting that a particular challenge will be to manage inflationary pressures without jeopardizing the public debt sustainability.
Recalling that during the pandemic public debt increased “but without overdoing it”, the Minister of Finance indicated that, in 2021, Cyprus was the country that repaid most of its debt and managed to reduce it, last year, from 115.4% to 103%.
Asked what the government's policy would be to address these challenges, he said that Cyprus would not follow the philosophy of countries that increase taxes on citizens to ensure their public finances./p>
“Our answer is growth, growth, growth. The more development possible. “Higher growth rates to increase revenue, more growth to increase purchasing power, higher growth rates to create and maintain jobs,” he said. “Everyone knows proven flexibility and resilience of the Cypriot economy, Mr. Petridis continued, reminding that we came out of the crisis of 2013 without tax increases, while today we are one of the few countries, as he said, that within a year managed to cover the lost ground created by the pandemic.
The answer, he continued, lies in our new growth model and economic philosophy, “an open economy, for entrepreneurship, for facilitating entrepreneurship, and productive investment, for more foreign direct investment, for private investment.”
< p class = "text-paragraph">The Minister noted that this is the philosophy for the new Long-Term Strategy for the Sustainable Development of the Cypriot Economy, entitled “Vision 2035”, which contains more than 200 practical suggestions for shaping all sectors of the economy and aimed at its transformation. Cyprus in a regional business center, especially for the high-tech industry.
In recent years, a significant number of companies have chosen Cyprus as their base, while due to the war in Ukraine, we see more and more companies coming to the island, he said and assured that the government is by their side and will support, through its policies, business.
“At the national level, we aim to diversify our economy, expanding its productive base and offering opportunities to many foreign companies”, said among others Petridis, noting that “this is the which is why, in this age of new geopolitical instability and uncertainty, Cyprus is perhaps the best destination in the EU market to host new businesses. “
The conference , which dealt with the short-term and long-term effects of the crisis caused by the Russian-Ukrainian conflict, took place in the presence of government officials and senior executives of companies in Cyprus, which are active in various sectors of the Cypriot economy.
Among the speakers of the four panel discussions that followed were the Minister of Interior Nikos Nouris, the Deputy Minister of Research Kyriakos Kokkinos and the Deputy Minister of Tourism, Savvas Perdios .
