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 I
welcome you all to the 30th Cyprus International Fair.
Allow me, first of all, to express my satisfaction as the Cyprus
International Fair celebrates this year its 30th birthday. Thirty years of
fruitful and creative contribution to the development of trade and economy
of our country.
I welcome the Minister of Justice of Greece Mr. Anastasios Papaligouras,
whose presence is proof of the bonds that link Cyprus and Greece and the
economic cooperation which the two countries have developed in all fields of
business activity.
I greet warmly our fellow Turkish Cypriot entrepreneurs who are
participating for the first time dynamically in the Cyprus International
Fair in an exhibit space of 1000 square meters. Their presence here gives us
particular joy, because it constitutes an important step in the right
direction for the development of commercial relations and cooperation
between the two communities, in the framework of the European Union’s
Regulations for trade through the green line.
I congratulate the President of the Turkish Cypriot Chamber of Industry Mr.
Salih Tunar and the members of the Chamber for the initiative they have
taken. An initiative which we have embraced from the start, providing all
possible facilities and favorable terms so as to make the presence of
Turkish Cypriot products in the International Fair possible.
This fact attaches a hopeful character to this year’s International Fair:
That of cooperation and peace. I wish and hope this initiative and example
will be followed by others so that in the next International Fair, which we
hope will take place in conditions of reunification of our country, in the
framework of a functional and viable solution, the Turkish Cypriot
entrepreneurs will take up even greater exhibition space. We look forward to
seeing our Turkish Cypriot compatriots in the Specialized Exhibitions as
well.
The Cyprus Government aims at the further expansion of trade through the
green line with many initiatives and proposals. I express the wish and hope
of the Government that, albeit belatedly, our pursuit for two way trade will
be accepted and be implemented.
The announcement by the Turkish Cypriot leadership of new measures that
include the levying of taxes on commodities moving from the free areas to
the occupied areas, not only will it not allow the development of two-way
trade, but it will also create feelings that will hamper the implementation
of the European Union Regulation on Trade through the Green Line. I hope
that the Turkish Cypriot leadership will think about this again and listen
to the wish of the Turkish Cypriots, as well as the Greek Cypriots for
reciprocal cooperation and cancel the prohibitive provisions it has
announced. It is our belief that the development of trade, economic and
other types of cooperation among the two communities may contribute to the
creation of an atmosphere of mutual understanding and create common,
tangible interests among the people of the two communities.
Such a development creates a strong prerequisite and the necessary positive
climate to embark on a new effort to solve the Cyprus problem. On the
contrary, the development of separate economies and separate transactions,
such as “direct trade” creates separate interests that strengthen the
tendency for partition. At this point, I want to stress that the demand for
“direct trade” is not based on economic reasons but aims rather at
political benefits. It serves political considerations, but not the economic
interests of the Turkish Cypriots.
It is for these reasons that we reject the proposals for “direct trade”
which have ulterior motives. The future and the interest of the two
communities is not served through division. It is served through a solution
that will lead to the true reunification of Cyprus on all levels.
It would be an omission on my part not to welcome the rest of the
exhibitors, Greek Cypriots and foreign, the participation of whom I
interpret as an expression of trust in the Cyprus economy.
One year after the accession of the Republic of Cyprus to the European Union
we may, within the framework of a concise review, express our satisfaction
for the way and the rapidity in which the private as well as the public
sector have adapted to the challenges and prospects that constitute the new
environment. It is a fact that during this time, certain sectors and certain
productive classes have had problems adjusting to the intensely antagonistic
environment of the European Union, especially because at the same time the
policy of protectionism, that the government traditionally followed, ended.
One proof of the dynamism of Cyprus’ economy is that we have joined the
Exchange Rate Mechanism. The satisfactory rates of development, the drastic
reduction of fiscal deficit, the reduction of the public debt, the low
unemployment and inflation rates, despite the frenzied rises in the
international price of oil, the reduction of the labour cost and other
fiscal indices project a healthy economy with development and modernisation
orientation. With confidence and determination, the Government is moving
toward European integration, with the adaptation, in two years, of the
European monetary unit.
Problems and obstacles do exist. There are, also, however, solutions that
will allow us to utilise the other factor of the new economic environment:
the great and many prospects.
With positive perceptions, with optimism and with confidence in our
abilities we can make good use - either alone or with co-operations – of
the opportunities emerging and we can sketch a steady route of progress and
prosperity.
The Government, considering with realism but at the same time with vision
the International, European and local situation, has drawn and put into
practice a new, modern and hopeful growth policy. A policy which aims to
overturn our objective disadvantages and to reinforce our competitive
advantages.
With a series of generous programmes of financing, we aim at the
technological upgrading of Cyprus’ Industry, in order to render it
competitive and at the same time give it an export-oriented nature. The
basis of success is the acquiring of a competitive advantage for as quality
is concerned. Our weakness to face competition on prices does not lead us to
despair. On the contrary, it restates the principle that we must do battle
on the level where we have, or we can acquire a competitive advantage: on
quality. Cypriot businessmen and workers are capable of the best, if only
they believe in it and aim for it. We have proved that with the economic
miracle we have achieved in much more difficult circumstances, just after
the disaster caused by the Turkish invasion.
Our industry has a future. We believe and invest in it with bold and
innovative approaches, leaving behind traditional and ineffective
perceptions and practices. We expect that the operation of the Council of
Industrial Growth, which the Government has decided to set up by law, will
contribute decisively in the enrichment of our industrial Strategy. The
participation of the public and the private sectors in the formation of the
industrial policy, through this Council, expresses the Government’s will
to put the principle of participation into practice in our state.
In exactly the same spirit and line of thinking the Government moves to
institutionalise the Council to ensure competitiveness. In the framework of
globalisation, the matter of competitiveness is the first priority of the
European Union, which aims to make European economy the most competitive in
the world with the Lisbon strategy. The Council of Competitiveness will be
given the task of studying all factors affecting competition and will
propose ways and strategies to reinforce the competitiveness of every
economic sector.
Cyprus economy’s basic axis is its services, which make up approximately
75% of Gross Domestic Product. The level of competitiveness of our services
can be positively compared even with that of the most progressed economies.
This achievement does not cause us to rest at ease. On the contrary the
Government has just recently completed, with the help of foreign
specialists, a multidimensional study, regarding the formation of strategic
projection and promotion of the services sector abroad.
The Government, faithful to the principle of public social dialogue has put
the study at the disposal of all interested parties. At the completion of
the dialogue the Council of Ministers will formulate the new development
policy and the projection of our services policy in the Single European
Market as well as in the markets of third countries.
As is known in one of the most fundamental areas of services, that of
Tourism, the Government has already implemented an aspiring Strategic Plan
which has been formulated with the cooperation of all factors of the Tourist
Industries. One can easily observe going through the progress reports
submitted to the Council of Ministers and the Parliament that both the
Cyprus Tourism Organization and the rest of the Civil Service implement the
commitments which they have undertaken with zeal and dedication keeping
strictly to the deadlines set.
In the following few weeks the Council of Ministers will examine important
policy proposals concerning substantial aspects of our tourism with the aim
of enriching and upgrading the quality of our tourist product. These
proposals are about the policy of incentives for the withdrawal of lodgings
adversely affecting the environment and the image of Cyprus. They are about
a new evaluation and classification approach of the hotels and other
lodgings on the basis of qualitative and not quantitative criteria.
The proposals include the establishment of a modern Conference Centre in
Limassol and of the Academy of Tourism which will aim at the
continuous education and professional training of all who are directly
related with tourism. Through the implementation of the Strategic Tourist
Development Plan we seek to relocate our country on the tourism map as a
quality destination, to address the problem of seasonality and to increase
our income.
To achieve all these objectives collective effort is required. The
government policy is not enough. Participation of local authorities is
imperative as well as the undertaking of initiatives by our business
community. All those who insist on practices and conceptions of the past and
remain idle run the risk of missing the train.
With the contribution of all the governments, the businessmen and the
employees we have succeeded in turning Cyprus into a Regional Business
Centre. Today we aim to strengthen and deepen even more the role of Cyprus
in our region making use of our geographical position imaginatively and
creatively, making us a natural bridge between the European Union and the
Middle East. We want to play this role in such a way as to combine European
interests and those of the neighbouring Middle East countries. Only with the
principle of respect for one another and understanding one another on the
basis of the mutual benefit can a firm and long-term cooperation policy be
established.
It is generally acknowledged that the most important advantage that Cyprus
has is its manpower. The highly educated professional personnel we have
allows us to aim at enhancing research and innovation. We aim to make Cyprus
a Regional Centre of Research and Technology.
The Cyprus Government proceeds with the creation of the first Technological
Park and Research Centres in cooperation with friendly countries and world
renowned University Centres.
We consider important the cooperation agreement of the Cyprus Government
with the University of Harvard which inter alia has led to the establishment
and operation of the Cyprus International Institute on Environment and
Public Health. With cooperations of this level which put Cyprus on the world
map of research we have managed to increase public investments in research
from the very negligible 0,018% of the Gross Domestic Product to 0,32% in
2004. With the creation of new Research Centres in other fields such as
Biomedicine which is studied by the competent Ministerial Committee we hope
that by 2010 we shall attain the objective of the European Union for the
expenditure of 3% of the GDP in research activities. We expect that with the
infrastructure that the Government is creating and the incentives to be
formulated, the private sector will also respond by investing in research.
The European Union aspires that the private sector will cover 75% of this
target.
In this effort we seek the cooperation and the participation of our
neighbouring countries on an equal basis. With this infrastructure the
prerequisites will be created for the development of high technology
industry which will depend on the intensity of knowledge and not on the
intensity of labour.
We aim at attracting foreign investment that will allow us to import the
indispensable know-how and technology as well.
In order to become even more effective in this field we are proceeding to
set up a Private Agency for attracting foreign investments while at the same
time a Ministerial Committee is examining a policy plan to simplify and
accelerate the procedures for licensing for investments. We improve the
business environment by creating conditions for developing the spirit of
entrepreneurship in the Cypriot society.
A measure for the immediate promotion of this goal is the introduction of
the Young Entrepreneurship Plan which constitutes a commitment by the
President of the Republic to the youth and which upon announcement notes
great success. Midterm and long-term this goal will be enhanced by the
Educational Reform which is currently under development and aims to
modernize our educational system so as to meet the contemporary challenges
and demands.
In the framework of the globalised economy competition is intensified but at
the same time opportunities and prospects increase. Using flexibility,
insight, the right strategy and programming, innovative ideas and
initiatives we are called upon to repeat the economic miracle which has
allowed us to conquer an enviable economic place in the region.
The Government in practice, dynamically and with a vision is formulating a
new model of development. Summarizing the philosophy of government policy, I
would say that it’s based on the following basic aspects:
First: The fiscal reform and effective management of the public
sector in order to preserve macro-economic stability.
Second: The balanced development of all sectors of the economy with
such a geographical distribution of investments that would encourage rural
development. The provision of more attractive incentives for the creation of
industrial units in rural areas aims at serving this goal.
Third: The viable development with respect for the environment and
the upgrading of the quality of life. The policy of providing incentives for
the utilization of renewable sources of energy as well as the setting up of
the Energy centre, with the import of natural gas in Cyprus aim at this
direction.
Fourth: The social coherence and to the respect for the citizens and
their rights. We wish, on the basis of the principle of social justice, that
all classes of the population and especially the weaker classes, to
participate in the distribution of the produced national wealth.
Furthermore, we wish to offer consumers the greatest possible protection and
information.
The strict control on the quality of various products and the publication of
the brands of products that are unsuitable for consumption, aims to serve
this purpose, and
Fifth: The modernization and the reconstruction of the state and other
structures of economy so as to achieve better effectiveness and to improve
our competitiveness.
I am certain that with this policy and with the contribution of all economic
and social partners, Cyprus will take its proper position within the
European Union family and in the Eastern Mediterranean region. We want to
and we can achieve the prosperity of all classes of the population and
render the Republic of Cyprus a bridge of cooperation and peace between the
E.U. and the peoples of the Middle East.
Concluding, I would like to congratulate the Chairman and the members of the
Board of the State Fairs Authority, the Management and its personnel for
their work and the excellent organization of the 30th International Fair.
To the Exhibitors, I wish every success and continuous progress.
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