The Cyprus Chamber of Commerce & Industry (Keve) on Thursday called for “bold decisions and substantive measures across nearly all sectors of the economy to sustain the country’s developmental trajectory”.

Speaking at the chamber’s annual general meeting, Keve president Stavros Stavrou, emphasised that to maintain the momentum of our economy, action must be taken on two fronts.

Firstly, he called for “immediate initiatives to swiftly resolve domestic issues to fortify our economy”.

This, he said, should be followed by “new actions to capitalise on emerging opportunities both within and beyond Cyprus”.

Opening his address with the Cyprus issue, Stavrou said that resolving the national problem would significantly strengthen the economy, enhance the prospects of Cypriot businesses, and promote the overall well-being of our society.

He also expressed hope that “the spectacular improvement in relations with the United States would continue under the new administration of president Donald Trump”.

Moreover, he said “the United States now seem to recognise the geostrategic importance of Cyprus and how this can serve their own interests”.

Subsequently, Stavrou delivered strong criticism of the state, describing it as the economy’s “biggest patient”.

He said that despite the efforts of previous and current governments, the state remains inefficient.

Stavrou also criticised the persistence of a “wasteful, sluggish, and counterproductive government structure that hinders entrepreneurship and development, especially in the digital age”.

In this context, Keve has proposed a series of recommendations to reform the state with a robust economic foundation.

These include the continuation of structured and prudent fiscal policies, a reorganisation of the state budget to reduce inflexible expenditures while increasing developmental spending, and the provision of targeted support measures for specific groups in need.

Moreover, containing public sector wages, currently constituting 28 per cent of the state budget, is also deemed critical, alongside limiting new hires in public services.

Further proposals focus on comprehensive digitisation of government services, decentralisation of state functions, and broadening staff interchangeability within the public sector.

The chamber also called for the abolition or modernisation of outdated laws and regulations that foster bureaucracy and a revision of public service schemes to align with contemporary realities, putting an end to the practice of universally rating employees as “excellent”.

Stavrou also warned that failure to fully implement reforms “risks undermining the entire effort”.

Specifically, on tax reform, he stated the country needs a “modern, flexible, and straightforward tax framework that meets the state’s new needs, respects taxpayers, and facilitates foreign investment”.

Stavrou said that any tax reform enacted by the state should satisfy three key principles.

It should distribute tax burdens equitably and fairly; simplify the system to align with current economic conditions; and take into account European and international tax trends.

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In terms of healthcare, Stavrou urged all stakeholders “to find effective solutions to eliminate abuses and improve the quality of healthcare services”.

Commenting on inflation, he said that despite a decline to just above 2 per cent, prices for many products in the real market remain high.

Focusing on energy costs, he highlighted the need for further actions. According to Stavrou, these include the liberalisation of the electricity market; and utilisation of natural gas from Cyprus’ exclusive economic zone (EEZ).

He also called for a greater use of renewable energy sources (RES) to reduce electricity production costs.

Regarding the launch of e-Kalathi, he said that the chamber maintains that “only officially recognised product codes should be included”.

He explained that this is to “ensure price comparisons are made between comparable items, promoting fair competition in the market”.

On labour matters, Stavrou expressed “concern over excessive demands in the public sector, where employees are already among the most privileged”.

He pointed to recent strikes in the State Health Services Organisation (Okypy) as evidence of the chamber’s “longstanding call for legislative regulation of strikes in essential services”.

In addition, he urged the government and parliament to “act decisively to prevent arbitrary strikes that inconvenience citizens and undermine the economy”.

In the same vein, he called on the government to exercise restraint in offering benefits to public sector employees, as “the wage gap between public and private sectors is widening provocatively”.

Moreover, the Keve president expressed concerns over increasing demands from private sector employees.

Stavrou calso alled on trade unions and the Employers and Industrialists Federation (Oev) to “engage in sincere and productive dialogue”, involving the Labour Ministry, to “address challenges in labour relations and find effective solutions”.

Turning to the private sector, Stavrou said that “businesses and households continue to face high lending rates, while banks offer low deposit rates”.

He added that the chamber “calls on banks to revise their charges, considering their high profitability levels”.

Furthermore, he stated that Cyprus’ tourism sector needs significant upgrades to enhance its offerings.

This, he continued, includes “improving infrastructure to attract quality tourism, addressing seasonality issues, expanding into new tourism forms, and developing winter tourism”.

Stavrou also said that the state must “continue to incentivise the industrial sector to upgrade technologically, increasing its competitiveness and contribution to GDP”.

“To achieve meaningful results in attracting investments, the country must improve its international image, which has suffered due to negative publicity, often unjustified or deliberate,” he added.

Stavrou stressed that “digital tools are vital for the future”.

He said that “without accelerated adoption of digital technologies, Cyprus will not realise its goals of attracting foreign investments and becoming a regional business hub”.

Concluding his speech, Stavrou referred to the chamber’s “numerous initiatives within and outside Cyprus”.

He then urged members to “remain close to the chamber, describing it as the vehicle to guide businesses confidently, securely, and stably into the future”.

At the end of the event, Marios Tsiakkis, Keve’s outgoing Secretary-General, was honoured for his service.

Finally, it should be noted that the president Nikos Christodoulides, also addressed the assembly.