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Our View: Less talk and more action needed on the ‘new economic model’

Christodoulos Angastiniotis

THE CHAIRMAN of the Cyprus Chamber of Commerce and Industry (Keve), Christodoulos Angastiniotis, delivered an excellent speech at the AGM about the need of the economy to be able to adapt to the constantly changing, technology-driven conditions. Being a small country, Cyprus should board the “train of technological development and of the digital world,” and move ahead with the needed modernisation and reform of the economy he said. Economic strength would be linked to technology, knowledge and above all the ability to develop by foreseeing the coming changes.

Nobody could disagree with his assertion that we need a more dynamic economic model, but how would it be achieved in a country run by politicians concerned only with votes, ultra-powerful unions fighting change and bureaucrats hell-bent on stifling business? Any reform, attempted by the government is guaranteed to encounter the strong opposition of reactionary politicians and unions that consider change a threat. What is worse is that these forces of reaction always win, government very rarely prepared to have it out with them. Meanwhile, businesses that attempt to trigger change are held back by a state bureaucracy that sees private initiative as the enemy.

Perennial distortions, such as the inability to carry out reforms, antiquated mentalities, unfettered trade unionism and delays in the administration of justice must end, said Angastiniotis. The question is who will end them? A government that backs down as soon as union bosses make a little noise? The two-month dispute with the teaching unions perfectly illustrated government spinelessness. For more than a decade, governments have been trying to introduce a reliable evaluation system for public sector workers and teachers, but unions block it.

As for the digital transformation of the state, the Keve chairman spoke about, it can only be regarded as a joke. To introduce a software system at a government department it takes years and by the time the contract is awarded it is obsolete, not to mention the obstacles placed by the unions, which want to protect jobs. We may be in the digital age but government keeps hiring more staff. It will not be long before the state returns to pre-crisis staffing levels, not to mention a pre-crisis public wage bill – all cuts were lifted at the start of this year.

Speeches about the need for a new economic model, tackling distortions and ushering in new technology are wonderful, but we need action, which the politicians, with an eye on elections will never undertake. Business leaders and their organisations must take the initiative, instead of always deferring to self-serving politicians that have no interest in rocking the boat. It has been proven that advice, gentle pressure, encouragement and passionate speeches do not work. If the business community wants to change things it needs to take action – to fight the politicians and unions which have always been the biggest obstacle to the modernisation of the economy.

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