Cyprus & World News

Cyprus announces privatization road map

06 December, 2013

Cyprus, under a financial adjustment programme revealed Thursday a privatization plan aiming at securing €1.4 billion by the end of 2018, stipulated in a €10 billion financial assistance package it signed with its international lenders.

The detailed programme provides for the privatization of Cyprus Telecommunications Agency (Cyta) and the Cyprus Port Authority by the end of 2015 and the selling of Electricity Authority of Cyprus by the September 2017, as well a divestment in four other organizations.
For Cyta, the plan envisages the participation of its employees either individually or collectively with percentage to be decided by March 2015 and then it will be offered to a strategic investor by the end of 2015. The plan stipulates that Cyta`s operations will not be separated.

Cyprus Port Authority will remain a state-owned organization as the regulating authority, while the state will proceed with a licensing round for the Limassol port, the island`s busiest port. Larnaca`s new commercial port is being constructed under a Public Private Partnership programme.
The plan provides for the privatization of Electricity Authority of Cyprus by the end of 2018. The Organisation`s operations will be unbundled (electricity generation, high voltage transmission network, low voltage distribution network and electricity supply).

Furthermore, the plan includes the privatization of the Cyprus Stock Exchange, the selling of Cyprus State Fair Authority`s immovable property, selling the state`s 51% stake in Forest Industries and the 11.9% stake in the Pancyprian Bakers Company.
According to the plan, the government will also explore the possibility of privatizing another five state-owned organizations and provides for the selling of real estate owned by the state. The government also plans to proceed with a licensing round for State Lottery and video lottery.

The approval of a privatization plan is a precondition for the disbursement of the €187 million third trance expected at the end of December.
The government believes the target of collecting 1.4 billion is feasible. The money to be collected will be used to reduce Cyprus` rising public debt, expected to peak around 126% in 2015.