|
Speech
by the Minister of Commerce, Industry and Tourism Mr Nicos |
|
Cyprus has a record of successful economic performance, reflected in rapid growth, full employment conditions and external and internal stability, almost throughout the post-Independence period. The underdeveloped economy inherited from Colonial Rule in 1960, has been transformed into a modern economy, with dynamic services, industrial and agricultural sectors and advanced economic and social infrastructure. In terms of per capita income, estimated at US $17.000 for the year 2003, Cyprus is classified among the high-income countries. These achievements appear all the more striking, bearing in mind the severe economic and social dislocation created by the Turkish invasion of 1974 and the continuing occupation of the northern part of the island by Turkey. The success of Cyprus in the economic sphere is attributed, inter alia, to the adoption of a market oriented economic system, the pursuance of sound macroeconomic policies by the government as well as the existence of dynamic and flexible entrepreneurs and a highly educated labour force. Moreover, the economy benefited from the close co-operation between the public sector and the social partners. During the last decade, the Cyprus economy has intensified its links to Europe. The European Union is the largest trading partner of Cyprus. The high level of development of Cyprus has been a significant factor in the very recent decision of the Commission of the European Communities to include Cyprus in the group of the ten countries for the first wave of enlargement to take place in 2004. Apart from its paramount political significance, accession to the EU will have widespread economic and social ramifications. Trade between Cyprus and the U.S.A., which is the biggest supplier of Cyprus, expanded significantly in the past decade and the total turnover reached the figure of U.S.$422 m in 2001. Exports of Cyprus products to U.S.A. amounted to U.S.$17 m in the year 2001 while Cyprus imports were of the level of U.S.$405 m. The main products exported to U.S.A. are footwear, clothing, Portland cement, halloumi cheese and fish. With a view to promoting further the traditional trade between the two countries in 1998 the Cyprus- U.S. Chamber of Commerce was founded. It is, also, worth mentioning that the Cyprus Trade Center in New York provides its best services towards this direction Despite the well known economic achievements of Cyprus and despite the fact that industrial output increase from year to year, the manufacturing sector, especially after the drastic reduction of tariff protection due to the participation of Cyprus in the World Trade Organisation, the Customs Union Agreement with the European Union and the continuing drive of Cyprus to become a full member of the EU, is facing some problems regarding its competitiveness both in the local market as well as in its export effort. As a result the share of the manufacturing sector in the Gross Domestic Product has been reduced, despite the increase in industrial production shown every year. Faced with this situation the Ministry of Commerce, Industry and Tourism, having thoroughly considered ways and means for the reconstruction and development of the sector has proposed a New Industrial Policy, which was approved by the Council of Ministers in June 1999. In formulating the New Industrial Policy the Ministry considered proposals put forward by industrialists and their respective organizations as well. The New Industrial Policy, which has been adjusted to become compatible with the European Union regulations, consists of twelve chapters. The first two chapters refer to the promotion of high technology industries in Cyprus through the establishment of incubators and the creation of a Center for carrying out applied research and technological development in high technology fields. These new institutions in combination with the existing research centres, like the Institute of Neurology and Genetics, the Agricultural Research Institute, some existing research institutes of the University of Cyprus and the Polytechnic School of the University of Cyprus, which is in the process of being established, will form the core of the necessary infrastructure for the promotion of the High Technology Industry of Cyprus. Both the Incubators and Research and Development Centre aim at promoting the development of new innovative products in the industrial sector and at bridging the gap between theoretical research and industry. It is a well-known fact that technology today is changing at a very rapid pace and in order to keep up, especially in the high tech field, new research has to be carried out all the time for the development of new products and services. The R&D Centre aims at promoting and sustaining this effort - the objective being to carry out research of an applied nature, which is geared towards developing specific new products or technologies. The High Technology Sector opens a new chapter in the industrial history of Cyprus. Without ignoring the existing industrial infrastructure of the country, Cyprus has made the big step towards high-tech which is expected to strengthen, enhance end enrich our economy. The basic prerequisite for the development of High Technology industries, very often referred to as “Knowledge Intensive Industry”, is the existence of the suitable human resources which will be involved with the applied scientific research and the technological development. Cyprus, with the high quality of local human resources, is perfectly positioned to take advantage of the opportunities offered in the area of high technology. I take this opportunity to call upon the members of Cyprus Scientist Network and Cypriot expatriates, in the United States in particular, to support our efforts to promote high technology industries in Cyprus. Their knowledge and experience is considered an essential factor for the success of this undertaking. The concept, which constitutes a technology-incubating program, is an innovative system designed to assist entrepreneurs and inventors in the development of new technology-based firms. It seeks to effectively link talent, technology, capital and know-how to leverage entrepreneurial talent in order to accelerate the development of new companies and thus speed up the commercialisation of technology. It is a facility that aids the early-stage growth of technology-based companies by providing shared facilities such as space and office services, and business consulting assistance. The Government of Cyprus will provide a grant of CY£57.000 ($87.000) to the incubators, over a three years period, to cover up to 100% of current running expenses and in addition a grant of 15% on the initial investment for the purchase of land, building and equipment and on the acquisition of know-how. The main income of the incubators will come from the fees to be paid by the enterprises under incubation for the use of the premises and for the services offered. The program for the creation of new high-tech or innovative enterprises is addressed to individuals or small groups of individuals who present a business plan promoting the development of an innovative idea. Applications by groups of individuals that include non-Cypriot inventors shall also be considered. The individual or team selected shall create a private company of limited liability. An agreement between the company, the incubator and the Government will then be signed, which will specify the rights and obligations of each party. The distribution of the share capital of the new company, which will be agreed between the inventor, the Incubator and a possible investor, if additional investment funds are required, will be included in the formal application to the Assessment Committee. It is noted that at least 50% plus 1 share shall belong to the inventor or inventors. The Government of Cyprus will provide the inventor company part financing of up to the sum of CY£120.000 ($204.000) for projects aiming at the development of new high technology products, for a period of up to two years. Within the efforts for the development of High Technology Industry in Cyprus the Government has signed agreements for cooperation on Science and Technology with Greece, India and today with your University. Similar cooperation is pursued with other countries, such as the Russian Federation, Ireland and other countries and also other academic institutions in U.S.A. The Government of the Republic of Cyprus has recently signed a four-year contract with a private company, which has already established and operates the first incubator in Cyprus. By the end of 2002, four additional incubators are expected to be established by the private sector in cooperation with the Government. I would like to point out, once again, that Cyprus offers the right business environment and has the suitable human resources required for the materialization of the vision for the creation of high-tech industries in Cyprus through the business incubators and the existing research centers and others that will be established. The relations and cooperation developed with other counties, will contribute to the achievement of this goal . The business opportunities will be further enhanced with the impending accession of Cyprus to the European Union. In concluding, I would like to thank you for your kind invitation to address this gathering and I hope and believe that the Agreement of Cooperation signed today between my Ministry and the University at Albany will establish a cooperative relationship in their areas of interest devoted to the promotion of science and technology, and for the purpose of establishing a long-term and mutually beneficial association. |
It is indeed
a great pleasure for me to be here again today, at the State University of
New York at Albany, and address this lecture series on Modern Cyprus on the
issue “Cyprus: Recent Developments in Science and Technology and
Opportunities for the Future.” I would like to take this opportunity to
express, once again, my sincere thanks and appreciation to the people ïf
your University and to our Trade Center in New York for their wholehearted
support and cooperation for the organisation of this visit and the signing
of the Agreement of Cooperation on Science and Technology.