Cyprus Mail

We are back to square one

Dr Yiorghos Leventis

IT WOULD not be an exaggeration to opine that the roots of the newfound severe economic meltdown of Cyprus bears almost all the hallmarks of the making of the political question that bedevils the sadly divided island for more than half a century. It is part and parcel of the idiotic-cum-idiosyncratic nature of Cypriot policy-making. What are the major characteristics of such political and economic behaviour?

Well, take your pick from the medley of clientalism, cronyism and favourism that secures lack of meritocracy plus rampant tax evasion, procrastination etc. All in all a laid back attitude of sweeping deep-rooted malaises – be it of an economic, administrative or political nature – under the carpet till such time that the malignant tumours swell to the point of no return: the inescapable explosion! Does this story sound familiar? What happened at the only Cyprus naval base almost two years ago?

Where will a country and its economy be lead if such traits have been entrenched as the ‘guiding principles’ of key decision makers for as many decades as the Republic of Cyprus has existed?

To be fair the March Eurogroup decision to impose a severe depositors haircut was unprecedented, particularly unfair, and definitely betraying a vindictive rather a solidarity attitude among our European partners.

It smacked of an unfriendly treatment; of reducing the Republic of Cyprus to a guinea-pig. More so as reports flowed in that other stronger ‘partners’ – the Germans especially followed by the Dutch have been eyeing the Russian and other – small compared to theirs – depositors in Cyprus. Post facto reports recorded that in the days that followed the shocking Eurogroup decision foreign businessmen based in Cyprus were bombarded with phone calls from German and Dutch as well as Latvian bankers seeking to entice them to transfer their sums to their respective banks. Some of our European ‘partners’ were reported as offering the opening of bank accounts in their countries within an hour.

Other Greek press reports revealed that a sizeable bunch of unpatriotic Cypriot capitalists who somehow managed to get insider information as to the expected ‘haircut’, fled their capital to the tune of tens of millions of euros out of the island well before the Eurozone despicable decision.

The unfair treatment in the hands of foreigners dovetailing in with the theory of foreign conspiracy which has perturbed much of modern Greek history brings us back to the theme of mismanagement, poor judgment and lack of (true) patriotism so much characteristic of Greek and for that matter Greek Cypriot politico-economic life. Konstantinos Karamanlis, the late President of the Hellenic Republic was often saying: the foreign powers would not so much unjustly treat us if we were not to give them the chance with our repeated blunders.

Not of a wise man to sin twice, the ancient Greek proverb goes. Nevertheless, successive Cypriot administrations have been sinning all along the turbulent history of the stillborn Republic: Mrs Georgadhi, the Auditor General of the RoC has been presenting her annual audit report to each and every President since 1998. Mrs Georgadhi stated in no equivocal terms that had her recommendations been acted upon with respect to stamping out corruption, embezzlement and/or mismanagement of public funds etc, there would definitely been no grounds at all for the state and the economy to go bust as they did in 2013.

She stressed: we would not have needed the Troika (EC, ECB, IMF) bailout!

For former President George Vassiliou, Georgadhi’s statement is ‘carrying coals to Newcastle’. He confirmed the same thing: as regards the management and overall operation of the Cypriot civil service the ‘loathsome’ Troika is telling us to do what we should have done years ago.

Ten years ago, in 2003, I was hired by the Cyprus Academy of Public Administration (CAPA) as a Training Officer to train Cypriot civil servants on EU policies and institutions in the run-up to the RoC’s EU accession.

A lower rank administrative staff member told me how Vassiliou in his term of office hired a British expert who soundly laid the foundations of CAPA that is to say the basis for rationalising the state’s civil service.

Soon after the English CAPA director contract ended and the directorship reverted to the Cypriots, the practice of good governance was gone. By the time the writer served in CAPA preparing Cypriot civil servants for EU accession, fundamental principles of good practice and meritocratic appointments were already long jettisoned.

I handed in my resignation refusing to toe the line of silence to endless malpractices and disrespect of the principle of meritocracy. Upon an honorary invitation by the Japanese government, left for Tokyo and successfully served the Peace and Governance Programme of the United Nations University and the Japanese National Graduate Institute for Policy Studies.

As these lines are being drawn, the World Bank and the UK are, once more, sending in their consultants with a mission to produce recommendations on how the bloated Cypriot civil service should be restructured to become efficient.

It is sad to realise that several decades have been lost. We are back to square one on this crucial economic matter that bears on Cyprus economic survival. But let us hope that this time the international experts’ recommendations on running an efficient state machine would be adhered to.

Dr Yiorghos Leventis is Director, International Security Forum, Independent Think Tank and owner of Gallery Leventi: Antique Maps & Prints

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