14.9 C
Friday, February 23, 2024

The problems from commercial transactions E/K and T/K

Must read

The expansion of the list of products imported into the free zones by the Turkish Cypriots and the effects

Τα προβλorματα απτις ε&mu ;πορικες συναλλαγες Ε/κ και Τ/κ /></p>
<p> The Green Line regulation only protects a small portion of the economy. </p>
<p>A great noise was created by the government's decision to expand the list of products offered to the market of the free Cyprus by the Turkish Cypriots based on the green line regulation. According to sources from the KEBE, the enlargement will not affect the economy since the specific products do not have the purchasing power needed to overshadow companies that offer the same goods in the free zones. Specifically, it is only 6 products such as coffee, potatoes, vinegar, frozen vegetables, lemonade and dried molochia. Of course, the complacency does not only come from the KEBE but also results from the numbers since in 2022 the value of imports of products in free Cyprus amounted to 11.3 billion euros, while the corresponding value of imports of Turkish Cypriot products is approximately 13 million euros, an amount that is negligible to affect the economy. Of course, the green line regulation does not protect the retail trade from illegal products illegally imported from the occupied territories, such as cigarettes, furniture, household goods, fuel, supermarkets and many others. The government agencies seem to be slacking off in dealing with the phenomenon, with the KBE constantly pointing out to the various governments that the issue needs a holistic approach in order for the economy to recover these funds back. It is for this reason that the KEBE, with its announcement on January 29, calls on the government to prepare a Plan to compensate for the above distortions regarding the sale of products from the areas under the effective control of the government of the Republic of Cyprus to the occupied territories, which constitute unfair competition to the detriment of EC products.</p>
<p>Enlargement will not affect the economy </p>
<h3 class=Health aspect

However, another issue that concerns both government agencies and the chamber of industry is whether the products that come from the occupied territories meet the health regulations and EU criteria. It is an issue that the leadership of the chamber collaborates with the Turkish Cypriot chamber, with the various services and also the commission, to regulate. Apart from the health aspect, security issues are also raised mainly for goods that fall under the black trade and not under the Green Line regulation. However, the chamber examines complaints from citizens who identify the non-existence of safety and health rules, and if the complaints are countered, they are dealt with accordingly.

FINTECH transactions

Nevertheless, the trade between Turkish Cypriots and Greek Cypriots does not only answer to the aforementioned but we also have the cooperation of Greek Cypriot and Turkish Cypriot services with the B2B model. This particular model is essentially a business that buys services from another with the purpose of either reselling or using the service by the business. This area seems to be very active between the two communities. It mainly concerns the well-known containers which are intended to become houses, building materials, furniture and in terms of food products it is mainly fish. It is in this category also that a significant disparity is found since the products available in the occupied areas are much less compared to those imported in the free areas. The problems that exist in this market mainly concern the Cypriot government since it will have to deal with more technical issues such as the regulation of VAT. Sources in “K” explain that the proposals of the KEBE that are prepared from time to time to the PtD concern such issues. For example, if a company sells a product, VAT is added to it, while a duty imposed by the pseudo-state is added to the price. Therefore, it is understandable that Greek Cypriot products are more expensive, with the result that potential Turkish Cypriot buyers prefer their own at the mercy of the increased price of Greek Cypriots. In addition, the other problem that exists and should be resolved for the convenience of business and in the framework of the cordial cooperation promoted for the two communities is remittance payments. In the occupied territories, most banks are branches of Turkish banks and Turkey has an embargo on financial activities originating from the KD. A consequence of this is that financial transactions cannot be processed for said business activities with both parties finding other payment solutions such as using FINTECH applications or cash payments being made. This gives rise to another parameter since EC and TC entrepreneurs have the possibility of evading taxes or hiding expenses. Another negative factor for the EC is that Turkish Cypriots, before purchasing goods from the Greek side, are required to secure a “special permit” from the so-called government. It is true, however, that as regards the goods that come from these transactions and are imported into free Cyprus, they are partially controlled by customs, a control that is disputed as being carried out in the occupied territories.

What is the green line regulation

It is recalled that the regulation of the green line arose from the process of Cyprus joining the EU and was the way in which the commission appeased the then concerns of the Turkish Cypriot community about economic isolation. Based on the regulation of the green line, the Turkish Cypriots can dispose of in the free Cyprus some products of Cypriot origin, agricultural, livestock and some goods which were subject to heavy industrial processing to be processed into Cypriot products. In addition, the regulation allows the two chambers to check the accompanying documents of the products and to jointly examine any irregularities in matters of safety and health. This specific regulation strengthens the good commercial cooperation between Greek Cypriots and Turkish Cypriots. Of course, we should mention that when the regulation was drawn up by the EU, everyone believed that it would not last for 20 years since they considered a potential solution to the Cyprus problem possible. One can say that the regulation needs to be updated, an action that the industry does not want to take place since during the period when the regulation was announced by the commission both sides agreed and the possible attempt to amend it might negatively affect the Greek Cypriot side.

Source: www.kathimerini.com.cy

- Advertisement -AliExpress WW

More articles

- Advertisement -AliExpress WW

Latest article