The north’s ‘state’ budget for 2025 has been forecast at 136.28 billion TL (€3.75bn) worth of ‘government’ spending, as deliberations begin in the ‘parliamentary’ finance committee this week.

The committee had been due to begin discussions regarding the budget a week ago, but these meetings were delayed due to the crisis over the election or not of a ‘parliament speaker’, which was, after 42 days of wrangling, resolved on Monday with the election of former ‘interior minister’ Ziya Ozturkler to the role.

The debate was opened on Tuesday by committee chairwoman, ruling coalition party UBP ‘MP’, and daughter of former Turkish Cypriot leader Dervish Eroglu, Resmiye Canaltay, who began her opening speech by saying that “fiscal discipline and budget discipline are indispensable for long-term economic stability.”

However, she did not shy away from forthcoming difficulties for the Turkish Cypriot economy, saying the north is “affected by high inflation, high interest rates, and unfavourable foreign exchange rates, both because it uses Turkish currency and because of its own special conditions.”

“Under these circumstances, we must face the fact that 2025 will be a year in which economic difficulties will continue,” she added.

To combat this, she said, “planned development” is essential, and to this end, she called on the ‘government’ to submit its “medium term development plan” as soon as possible.

She also pointed out that the north is forecast to run at a budget deficit this year, with that deficit said to amount to 17.6bn TL (€484 million).

This fact was picked up on by ‘finance minister’ Ozdemir Berova, who said it is the ‘government’s’ aim to “put into effect revenue-increasing measures” to reduce the budget deficit and produce a balanced budget by the year 2027.

He described the budget as “a plan, a schedule, a roadmap”, and stressed the need for it to be prepared and used carefully.

“Our duty is to ensure that our country’s resources are effectively distributed,” he added.

However, not everyone was convinced by the figures offered, with committee deputy chairman and opposition party CTP ‘MP’ Erkut Sahali saying that according to his calculations, the budget deficit may well exceed the ‘government’s’ forecasts and reach as high as 50bn TL (€1.37bn).

He also pre-emptively criticised the government for not taking the opposition’s suggestions on board regarding the budget, saying, “we will evaluate this budget in detail, but we will act with the knowledge that the government will listen to our suggestions with a half-hearted ear.”

Delving into specifics, he said people are preferring to shop in the Republic, and that as such, the north’s retail sector has taken a hit in the last 12 months. Despite this, he said, there has been “no allocation in the budget to reverse this in 2025”.

Once the opening speeches had concluded, discussions began over the various departmental budgets which make up the whole, with the budget for the Turkish Cypriot leader’s office and the ‘parliament’ the first to be discussed.

These two budgets have seen large increases compared to 2024, with Tatar’s office and ‘parliament’ set to move to a large new complex located across 400,000 square metres of land in the Nicosia suburb of Ayios Dhometios in the next few months.

The final act of Tuesday was the budget for the law department, with deputy chief public prosecutor Ahmet Varol saying that on account of the rapid growth in the north’s population and a growth in the number of crimes, the department is now stretched.

He said a total of 48,214 criminal cases have been opened in the north this year, and said there is a shortage of prosecuting lawyers. This has meant that in Lefka, where the courthouse was reopened in March, prosecutors have been imported from elsewhere in the north to ensure there were enough people to handle the caseload.

Tatar’s office and the ‘parliament’s’ budgets were passed by the committee with the votes of ruling coalition ‘MPs’, with opposition ‘MPs’ voting against the two budgets, while the law department’s budget passed through the committee unanimously.