Cyprus Business Now

The general manager of the Cyprus Employers and Industrialists Federation (ΟΕΒ) Michalis Antoniou, speaking to StockWatch, said that there is a grave shortage of manpower that threatens the growth of the Cyprus economy. The shortage, Antoniou said, is mainly found in the hotel industry, the construction sector, the retail trade and the processing.

“The economy is threatened with a major malfunction, due to the huge problem of labour shortages in companies, which at the same time sound the alarm for an upcoming wave of suspension of work of unsustainable small businesses.

There is concern that the combination of a labour shortage with the reduction of government support for small businesses will lead to a wave of insolvencies and leave the banks with a plethora of non-performing loans. As yet, however, there  has been no such increase in either business failure or NPLs.

Labour organisations are asking the government to relax restrictions on working for students and asylum seekers.

In the Cypriot banking system, non-performing loans (NPLs) stood at €5,134 million at the end of May from €5,141 million in April. This indicated a decrease of approximately €7 million, according to data released on Wednesday. Central Bank of Cyprus. Total NPLs remained, however, at 18.1 per cent of total lending.

At the end of 2020 the total NPL exposure amounted to €5,111 million and at the end of 2019 to €8,972 million.

Specifically, according to the CBC data, the total loans were at the end of May 2021 at €28,419 million, from €28,445 million at the end of the previous month, while the total loans subject to a delay of 90 days amounted at the end of May 2021 to €3,956 million or 13.9 per cent of total loans, from €3,921 million at the end of April 2021.

Also, the total loans restructured until the end of May 2021 amounted to €3,833 million (€3,789 at the end of April of 2021), of which €2,311 million remain in non-performing loans.