Cyprus President praises economic growth

Cyprus President Tassos Papadopoulos has praised the economic growth in Cyprus, saying that stability has been achieved through a carefully balanced plan, long strategy and the contribution of the social partners, who displayed self restraint in their demands.
He also said that the introduction of the euro, expected in January 2008, will not restrict economic development but on the contrary it will secure the stability of the currency and low interest rates and protect the economy from inflation.
Speaking at the opening of the 32nd Cyprus State Fair in Nicosia, Papadopoulos said “given the current economic indicators, we believe we shall achieve both goals, namely smooth entry into the euro and extend and improve social grants, especially to low income earners.”
He said that the government has no intention of sacrificing the social state for the sake of entry into the eurozone, but noted also that all indications are that Cyprus’ economy will allow both objectives to be achieved.
“What we have achieved so far in economic terms is the result of concerted efforts by the employees, the employers and the government,” he said and extended sincere thanks for this to the trade unions and all concerned.
There is full employment, with unemployment rates at 4,5 per cent in 2006, per capita income at 86 per cent of the average in Europe, which is the highest among the ten new EU members.
“Inflation continues to remain at a low rate, around 2 per cent, interest rates have recorded their lowest level since the Republic was established in 1960, fiscal deficit dropped from 6,3 per cent in 2003 to 1,5 per cent of the GDP in 2006 and public debt is decreasing and stands at 65 per cent and continues to drop,” Papadopoulos said.
He also said that all this was achieved without any new taxes, on the contrary social grants and allowances now cover more people than before.
“Public finances are on a stability course and this is due to the people of Cyprus. Now however we have new high goals to achieve for an even better social state, social cohesion and support of low income families,” he added.
He noted that EU projections about the local economy are fully in line with the forecast of the Finance Ministry, adding that the government is well aware of public concern about the introduction of the euro and is taking all necessary measures to either minimize or eliminate them.
On direct trade between the Turkish occupied areas of Cyprus with the European Union, a long standing demand of the Turkish Cypriot community, President Papadopoulos pointed out that it will not have any real and substantive economic outcome.
“Total exports from the Turkish occupied part of Cyprus to Europe amounts to a mere 8 million euro per year. The demand is a clear political claim, aimed at serving political expediencies and not economic benefits for the Turkish Cypriots,” he stressed.
He explained that the fact that the EU directive for financial aid to the Turkish Cypriots has been separated from moves to introduce direct trade certainly contribute to the economic development of the Turkish Cypriot community.
He sent a particularly warm welcome to Turkish Cypriot businessmen participating in the annual trade fair and expressed hope that their participation and the implementation of the Green Line regulation, relating to trade within the island, will contribute significantly to increased trade and financial transactions between the two communities and to conditions that will help reunite the country, divided since 1974 when Turkish troops invaded and occupied its northern third.
On Cyprus’ trade and commercial relations with other countries, he said the government wants to promote additional trade links, encourage more industrial development and economic cooperation and strengthen research and innovation, as part of its overall policy to develop trade even further.