Cyprus Mail

It will take as long to restore confidence as it did to lose it

I went to a conference in Nicosia this week and heard almost every speaker refer to the necessity of a return of confidence to future economic health, but it was spoken about with some imminent expectation of its arrival.

I found this verging on the unbelievable and wanted to express a view in the hope that someone in the government can read and might even read your newspaper or that someone who does might tell them about it.

Confidence’ can be rocked by an individual main event, but usually it erodes over time and Cyprus is no different. It develops or goes away as a result of the concerted behaviour of individuals, in this case as perceived from the outside, if we are talking ‘foreign investment’ to assist economic development in the future.

Confidence’ didn’t suddenly go away on Saturday 16 March 2013. In recent time there have been several confidence eroding events. Let’s start with 2004 and the Annan Plan. By voting nearly 80 per cent ‘no!’, we said that we were rejecting a plan considered as OK by the UN and most of the rest of the world and we said very loudly and anyone relying on a solution for investment reasons could forget it.

We then proceeded to fleece ‘Gladys and Fred’ as they tried to buy a retirement home in Cyprus. For a while they didn’t mind as they saw the values rise, but now they don’t have any positive value margin, or any title deeds and now the thought of repossession because the developer is a serial ‘Non-Performing Loan’ borrower, Any thought of ‘justice’ evaporated in the various decisions in cases like Conor O’Dwyer where it became a trivial offence to  hospitalise buyers, and, consistent with the new precedent of re-selling a house already contracted for sale and keeping the money.

It doesn’t help that the former attorney-general’s son can escape justice and the former deputy AG sent his girlfriend to the dentist and attempted to do this at the taxpayer’s expense.

We continue to use oil to produce electricity because we couldn’t get inter departmental agreement to obtain gas and we continue to worry about water while throwing it all over the streets and now we seem to be ‘doing it all wrong’ in the case of the local ‘fysiko aerio’ and we risk a battle with Turkey over its extraction.

We allowed a convoluted sense of politics to destroy half of our power generating capacity. Our government demonstrated its incompetence in dealing with commercial matters and the presence of embedded corruption upsetting in turn Qatar and China and maybe Armenian Canadians.

The previous government sat around and did all that it could to shunt the banking crisis into Anastasiades’ term of office while enjoying the  presidency of Europe, deepening the crisis when it came and losing a bank, not to mention the individual with ‘koyremata’.

Now we have a credit crunch and a depositors strike, high unemployment and we haven’t even started to ‘de-leverage’ our NPL’s.

So where is the ‘confidence’ to come from? Maybe a few vultures, when they feel ready will come into the market to pick off a few low priced assets and this will be heralded as the ‘Return of Confidence’.

It will take as long to rebuild ‘confidence’ as it did to lose it and only then if we have a concerted effort to get that restoration, which at the moment we do not. Meantime we shall continue to be seen as the ‘lime-stickers’ and ‘mist- netters’ and just left to wallow in our increasingly rubbish strewn country… another point of increasing importance for investors,’ green credentials’. We are bankrupt on that score.

To understand all that, we have to see ourselves as others see us.  The ‘Restoration of Confidence’ isn’t going to be achieved by a night out over a meze in a local taverna. A few changes have to be made and allowed to take root culturally first.


Philip Beardwood


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