Cyprus Vision 2035: A plan to build a resilient economy

Cyprus Vision 2035: A plan to build a resilient economy

Plans by Sector:

Agritech: Create co-operatives, combine resources, Institute of Agriculture to guide creation of a technology base for shared use, optimization of water resources.

Ecommerce: Government will support improvements in infrastructure and aid small companies to compete in the global market created by the web.

Manufacturing: Government will provide support for light manufacturing, and the creation of innovative products that can be marketed from Cyprus.

Professional Services: Programmes will help to take advantage of synergies and tie into global value chains.

Solar energy: Partnering to manufacture panels here in Cyprus.

Tourism: We will encourage the establishment of health facilities as well as diversifying in new sectors like ecotourism and agrotourism.

Long-term sustainable economic growth

For more than two years, the Council for the Economy and Competitiveness has been working on a 15-year plan to develop a new model for the Cyprus economy. Funded by the European Union Structural Funds, the Council has brought together a team of academics and business leaders who expect to complete the plan by the end of this year.

In an interview with the Cyprus Mail, Takis Klerides, former finance minister and the chair of the project, gives us a glimpse of how the VISION 2035 plan will proceed, and a sense of how it will affect certain sectors.

“It’s important to understand that the plan is not static; it will change and evolve as the world and the economy changes. China in 2030 may not be very much the same as China in 2020. So it’s a continuing process.”

But the objective of the plan is clear: “An important outcome of the project is expected to be the identification of key, existing and new sectors that can be drivers for achieving long-term sustainable economic growth, based on the comparative and competitive advantages that Cyprus has or can develop,” Klerides insists.

The objective is to strengthen the international competitiveness of the Cypriot economy, to improve its resilience to adverse internal and external factors, and to improve the potential for sustainable and long-term development.

“The big obvious question that one may raise is whether the Government (present or future) will adopt the recommendations and proposals of this strategic study. Our plan to engage all concerned involved from the beginning, encourage us to believe that the study will be taken aboard by all parties. Our proposal will be to link this long-term strategy with the state budget and allocate this to an official entity with political backing,” Klerides explains.

Based on the main sectors of the economy that will lead the way and be the drivers of growth, Klerides points out that the business community should start planning to expand their businesses towards these sectors: Agritech, Information and Communication Technology (ICT), Light Manufacturing, Professional Services, Solar Energy, Tertiary Education, Tourism, Green Economy and Innovation and R&D.

Agritech

For Agritech, we need to encourage the creation and extension of co-operatives, so as to combine resources and share a joint technology base. Under the aegis of the Institute of Agriculture, we can bring in technology that can be rented out at small sums for farmers who could otherwise not afford it. We can also develop a strategy for the shared use and optimisation of water resources. Farmers should also be encouraged to specialize in crops that flourish in our specific climate conditions.

Light manufacturing

Taking into account the difficulties and inherent disadvantages, emphasis should be given on food processing, pharmaceuticals and biotech. Emphasis should be on high value goods by giving appropriate incentives to set up high added value sectors in Cyprus.  There are many types of manufacturing that could be cost-effective in Cyprus; we will try to broaden the sector.

Ecommerce and Information and Communication Technology

Government will support improvements in infrastructure and aid small companies to compete in the global market created by the web, finding new channels to market products. Logistics providers will also be supported. There will also be an improved legal framework for ecommerce. For Information and Communication Technology (ICT), we should encourage international ICT firms to establish in Cyprus or partner with local business. Targeted immigration to fill gaps in missing skills by providing “high-skill visas”. Encourage building science parks with tax breaks. The Government should attract IT companies through tax incentives, assist talent development and attract international talent and support start-ups.

Professional services

The government will continue to work to attract Digital Nomads freelancers and remote workers. We should also expand the spectrum of professional services to broaden it from what we have been providing in the last 40 years, e.g. business services, treasury, compliance, risk management, digital enhancement will provide new roles for multi geographical locations.

Solar Energy

This will grow with a focus on high-tech manufacturing of renewable energy products and partnering with other developed companies to manufacture solar/PH panels both for Cyprus and overseas will be supported. The use of such technologies for government and local government will be supported.

Tertiary Education

We will work to improve the skills of existing workforce to suit the labour market of the future. We should recognise the existing mismatch of qualifications and transform the secondary school education to modern ways of critical thinking and digital skills development.

Tourism

Tourism must gradually grow out of high volume and seasonal model. We will encourage the establishment of health facilities as well as diversifying in new sectors like ecotourism and agrotourism. Emphasis should be placed on expanding into higher quality hotels and targeting business visitors. We should also aim to become world leader in net carbon zero in the next 10-15 years.

Innovation and R&D

In order to attain the best results and develop an innovation cluster, proper planning and cooperation is required. In order to improve the level of innovation, we should implement policies such as investing in education, encouraging cooperation between the academic community and businesses and generally aim for a digital-friendly business environment.