Incentives needed to boost housing supply, Keve says

The vice-president of the Cyprus Chamber of Commerce and Industry (Keve), Andreas Demetriades, this week highlighted the concerning issue of soaring rental costs, which, in many cases, exceed the means of Cypriots to afford a place to live, let alone purchase property.

In response to this phenomenon, the chamber has proposed to the Finance Minister the implementation of various incentives for developers and builders to substantially increase the housing supply in Cyprus.

Speaking to the Cyprus News Agency (CNA), Demetriades said that after conversing with local developers, it became apparent that with the provision of appropriate incentives, a sufficient number of new apartments and houses could be constructed within a short span of time, possibly even within one and a half years, to cater to the rental market in Cyprus.

Furthermore, Demetriades revealed that the Chamber of Commerce’s Executive Committee recently engaged in a meeting with the Minister of Finance. The gathering addressed a number of issues affecting the business landscape, encompassing loan interest rates, deposit rates, and taxation concerns, such as VAT exemptions for capital expenditures in specific sectors.

Highlighting banking concerns, Demetriades raised the exorbitant charges imposed on money transfers and anti-money laundering checks, which currently account for nearly 1 per cent of the total transaction amount.

Demetriades also disclosed that discussions encompassed other pertinent issues, including loans from companies to managers, discrepancies between Social Insurance Office collections and those found with the Tax Commissioner, factors indirectly related to the cost of living allowance (CoLA), as well as the escalating energy costs.

Moreover, anticipating a strategic plan from the Ministry of Finance, Demetriades emphasised the importance of attracting investment from international players, who could potentially unlock various projects on the island.

“We expect that there will be a strategic plan on the part of the state and in particular the Ministry of Finance in order to attract direct foreign investments,” he said.

In addition, he called for comprehensive measures to revamp the economy and streamline public service operations.

Such reforms, he explained, should enable electronic and automated transactions between the private and public sectors, minimizing time loss for both individuals and the state.

Demetriades also underscored the significance of passing the Investment Assistance Law, which would facilitate expedited planning permit acquisition for large and small projects, ensuring that permits are issued within one year at the latest.

Finally, Demetriades noted that the discussion also involved the modernisation of the justice system, along with other necessary transformative initiatives, in order to enable the efficient functioning of the state and support the active participation of the private sector within Cyprus and abroad.