Cyprus & World News

Commission reprogrammes 21 m. euros of regional funds in Cyprus

26 April, 2013

The European Commission adopted Friday a reprogramming plan that will help promote growth in Cyprus and strengthen the impact of EU regional funds there.

In a press release, the Commission said that the decision to redirect €21 million worth of Regional Funds “is intended to help the country deal with the current socio-economic crisis and ensure a quicker delivery of available investments particularly when it comes to supporting small and medium sized business and the employment of young people”.

The decision will see funds from lesser performing regional policy areas being redirected to where the funds are likely to have more impact for growth and jobs in the shorter term, it added.

Some €11m worth of funds will be reallocated to build on projects for SMEs (€8.5m) and for measures to promote youth entrepreneurship (€2.5m). A further €10m will be moved to projects for the regeneration of urban and rural areas.

In particular €21m from the area "Knowledge Society and Innovation" will be transferred to the areas of "Productive Environment" and "Regeneration of Urban and rural areas". Moreover, promising additional projects mainly in the field of renewable energy and innovation (worth €9m) within the "Knowledge Society and Innovation" area, will be promoted. Priority will be given to some Major Projects so as to include the Sewerage System of the Kokkinochoria Complex and the Vertical Road that connects the Limassol Port to the Limassol-Paphos Highway where funds could be used more quickly and effectively.

It is noted that “this revision was requested by Cyprus earlier this year and has been given added political momentum in the last few weeks”.

Commenting on the reprogramming decision, Commissioner for Regional Policy, Johannes Hahn said that “the decision will help Cyprus to weather this crisis and tackle its economic problems by using EU regional funds in the most effective way possible- in areas that will contribute to the countries efforts to boost growth and competitiveness, particularly that of its SMEs”.

He added that the Commission is working closely with the Cyprus authorities and are in continuous discussion on how EU regional funds can support the country`s efforts to emerge out of this crisis.

Cyprus has been allocated more than €600 million in total cohesion policy funding from 2007-2013.

On Μarch 25 Eurozone Finance Ministers, known as the Eurogroup, decided on a €10 billion bailout for Cyprus coupled by a bail-in by uninsured depositors.

The decision provided that Cyprus` second largest lender, the Cyprus Popular Bank, will be wound down, whereas Bank of Cyprus` uninsured deposits will take losses up to 60%.
The House of Representatives is going to convene next Tuesday in an extraordinary session to discuss the loan agreement and the Memorandum of Understanding with the Troika, the immovable property tax bill (IPT) as well as other bills emanating from the Eurogroup decision on Cyprus.