Cyprus Stock Exchange (CSE) president Marinos Christodoulides, has called for greater state support for the exchange, saying that it has a critical role as a tool for economic and corporate development.

In statements made to the Cyprus News Agency (CNA), Christodoulides stressed that “the stock exchange should be fully utilised by the government and the country’s businesses to secure a prominent position in the Cypriot ecosystem, similar to its role in developed countries worldwide”.

He also said that the legal review of the bill for the privatisation of the CSE by the attorney general’s office is expected to be completed by the end of February 2025.

Christodoulides pointed out that, in pursuit of this goal, the stock exchange has expanded its services and investments to increase its value and broaden its operations, making it more attractive to potential investors.

Moreover, he explained that the CSE has introduced new measures and procedures to diversify its offerings, boost its income, and reduce operational costs.

However, he acknowledged that the exchange’s current legal structure as a public entity limits its flexibility in these areas.

Asked whether the value of the CSE should be increased before moving ahead with privatisation, Christodoulides affirmed that “as a stock exchange, we have been making continuous efforts in recent years through strategic development initiatives to expand our markets, services, and products to make it more attractive, contributing to increased added value”.

Additionally, he highlighted the introduction of new regulations and procedures aimed at boosting income and attracting investment, but also noted the challenges imposed by its existing legal framework.

Meanwhile, Invest Cyprus CEO Marios Tannousis also expressed support for the strengthening of the CSE’s role.

Tannousis said that “the strengthening and upgrading of the CSE will further help in attracting quality foreign investments to Cyprus, something that aligns with the strategic plan of Invest Cyprus”.

He added that efforts to attract a strategic investor for the CSE should proceed rapidly, stressing the need for steps to strengthen the exchange from the state side in order to make the investment more appealing to foreign investors.

Tannousis also reiterated that “Invest Cyprus supports the search for a strategic investor to help the stock exchange play a more significant role in the Cypriot economy and attract investment from both local and international companies”.

He mentioned that the agency has been working with foreign investors interested in the services offered by the CSE.

Both Tanousis and Christodoulides highlighted the importance of providing tax incentives to encourage the listing of new companies on the CSE, as well as the potential for expanding government bond issuances.

Christodoulides noted that the stock exchange has also been actively engaging with companies to encourage them to list, while also diversifying its services to include areas such as energy, the competitive electricity market, and managing carbon emissions auctions for the government.

“The privatisation of the CSE remains a key priority, with the ultimate goal of finding a strategic investor to enhance the stock exchange’s role in the economy,” he said.

Christodoulides explained that once the bill is approved by the House of Representatives, the process will move forward with a public tender to attract interest from investors, followed by the selection of a suitable buyer.

“After the approval of the bill by Parliament, the process will proceed with a public tender for expressions of interest to purchase the majority stake of the CSE from a stock exchange-strategic investor of proven experience and value, as outlined in the bill,” he said.

In response to questions about increasing the CSE’s value before privatisation, both leaders agreed that strengthening the exchange, particularly through technological upgrades and partnerships with other stock exchanges, is essential to maximise its potential value for investors.

“The stock exchange has expanded its services and investments, including in energy, participation in the competitive electricity market, managing the government’s carbon emissions auction rights, and providing services to the Finance Ministry for public debt, to increase its value and broaden its operations to make it more attractive,” Christodoulides concluded.