Cyprus Mail
Business Cyprus

‘On the road to a new economic miracle’

By Angelos Anastasiou

Cyprus is on the road to a new economic miracle, President Nicos Anastasiades said on Wednesday, referencing the island’s unexpectedly strong growth in the period after the 1974 Turkish invasion.

In a speech during the 2012 Cyprus Exports Awards ceremony at the Presidential Palace, organised by the ministry of commerce and the Cyprus Chambers of Commerce and Industry KEVE, Anastasiades commended Cypriot export firms for persevering through tough times and contributing much-needed liquidity to the country’s strapped economy.

“In the midst of serious financial challenges events like this are especially important, as they allow us to recognise and reward hard work under extremely difficult circumstances, and to express our deep appreciation to the business world for its multifaceted contribution,” the President said.

Anastasiades declared that, following the third troika review last week, the country’s budgeted primary deficit had been significantly revised to reflect economic performance – it is now predicted at €277 million, down from an initially estimated €483 million.

Falling borrowing cost is also a reliable indicator of regaining the trust of international investors, Anastasiades argued. Market yields for government bond issues – i.e. interest payable on borrowing from financial markets – hovered around 15 per cent for months in the aftermath of the March 2013 Eurogroup decisions on Cyprus, but have been in steady decline to the current 7.2 per cent.

“It seems that Cyprus is on the way to a new economic miracle, and this has not eluded our international creditors, nor the international press,” he said.

Describing recent encouraging signs relating to Cyprus’s economic performance, the President cited flattering reports in foreign economic publications and an upgrade of the Cyprus economy by an international rating agency last November – the first in three years.

“Following several recent negative reports, respected international media, like the stern German economic press, are forced to extol the Cyprus economy’s road to recovery, and report that the targets set in the adjustment programme have been fully achieved,” the President said.

“Cyprus’s demanding austerity programme has borne immediate fruit, in contrast to those implemented in other counties of Europe’s south.”

Anastasiades assured exporters that the government would lend its unconditional support in their efforts, and lauded their spirit of entrepreneurship as being “key to the country’s economic recovery.”

“Aiming at incentivising trade and strengthening business activity, as well as easing the effects of the financial crisis, the government has announced growth measures with minimal fiscal impact”, he said.

“Much-desired economic growth must be driven by private initiative, not the public sector. The government’s duty is to create the right environment that will encourage and reward private activity,” Anastasiades explained. “That is exactly what we are doing.”

At the same function, Minister of Commerce Giorgos Lakkotrypis reaffirmed the government’s support to export firms through various measures and actions.

“The ministry supports business activity by securing access to new markets through international agreements, participation in specialised exhibitions abroad and organising business missions to selected international markets presenting business opportunities,” he said.

The president of the selection committee for the awards, Panayiotis Loizides, said that exports increased by 1.8 per cent in 2012 compared to the previous year, and the improvement continued throughout 2013, with a 1.6 per cent increase in the period January to October compared to the same period the previous year.

“This encouraging result proves that our economy is resistant and resilient,” he noted.

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