Cyprus Mail
Guest ColumnistOpinion

Date of presidential elections should be brought forward

comment les the government does not have time to waste the next 12 months electioneering
The government does not have time to waste the next 12 months electioneering
By Les Manison

Although the date of the presidential elections is still 12 months away there is already excessive attention being focused on the prospects of the many potential candidates. And in the run-up to this election the agenda of the ruling political party is likely to be increasingly concentrated on policies directed toward gaining voter support rather than unpopular measures aimed at remedying festering structural problems.

But unless these problems such as the financial hemorrhaging of the national health scheme (Gesy) are attended to without any significant delay the future prospects for Cyprus society and the economy could be profoundly damaged. Thus, it is argued it would be better to get the presidential elections over and for next administration to use most of the next 12 months to implement policies and reforms aimed at addressing serious problems.

Presently, Cyprus is faced with important problems in many areas. For example, government finances are under increasing pressure as the mounting deficits of Gesy and the need for increased financial assistance associated with the impact of the pandemic and higher energy prices severely strain its revenues. There is a compelling need to raise rates on employee and employer Gesy contributions and collect more taxes from the wealthier sections of the population by broadening the tax base and increasing the progressiveness of the tax system. However, the ruling party is not going to jeopardise its election chances by introducing unpopular tax measures as well as not engaging in considerable vote-buying prior to an election

There is an urgent need as well for the government to change its business model which is heavily based on large-scale property development directed largely at attracting foreign demand that has been underpinned by the scandalous implementation of the golden passport scheme. Is the government going to claw back financial and real resources from property developers by pressuring them to pay their huge debts and tax arrears and discontinue new projects before the presidential elections and risk incurring the anger and lack of electoral support of developers and business associates?

The government needs to get moving in channeling resources away from the property sector and into “green” and socially oriented investment projects to be implemented under the Recovery and Resilience plan in order among other things to gain badly needed financing from the EU.

These investments and reforms should not be unduly delayed by a government continuing to relentlessly pursue its debt-fuelled, wasteful, and inequitable business model as blatantly appears to be the policy of the administration of President Anastasiades for the coming 12 months.

Accordingly, it is recommended that the date of the presidential election be moved forward to May 2022 so as to prevent electioneering from diverting attention from the urgent need to deal with problems that are further damaging the Cyprus economy and society such as excessive property development and the overwhelming accumulation of debt.

 

Leslie G Manison is an economist and financial analyst, specialising in macroeconomic policy analysis, bank viability assessments and international financial relations. He is a former senior economist at the International Monetary Fund, an ex-advisor in the Cyprus finance ministry and a former senior advisor at the Central Bank of Cyprus

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