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The second round of the presidential elections next Sunday (24/2/2013) leaves voters with a simple choice – do we or don’t we get out of the mess we are currently in. The constant delays by the government to do anything with the romantic hope that the natural gas discoveries will (some day) prevent a bailout, has brought us to the stage we are in, with our backs to the wall and a financial cliff ahead of us.
The outgoing communist administration has failed so miserably in its economic policy that it has burdened its own candidate, Stavros Malas, with the dilemma of whether to shed his ideological past and embrace an agenda of continued austerity in the public sector and growth in the private sector, the driving force of the Cyprus economy. This momentum can only come through reforms, privatisation of services and government departments (let’s call them de-nationalisations, for now), an unpopular freeze of labour costs and conformity with the Troika demands to curb public sector spending, all part of a neo-liberal approach that President Christofias has likened to the work of the devil. If Dr. Malas is to succeed, he must urgently proceed with concluding the bailout programme in order to secure funds for the recapitalisation of the banks, that will in turn kick-start lending to the private sector and, in particular, to the small and medium-sized enterprises.
Considering that Demetris Christofias refused to budge on labour reforms, which have now been unavoidably imposed on us, having sent public sector costs spiraling to unsustainable levels, it is hard to believe that Stavros Malas will want to discuss key issues such as abolition of the Cost of Living Allowance and a long-term freeze on public wages. In other words, with another five years of communist rule, competitiveness will go out the window, hampering entrepreneurship and killing any hope of a quick recovery. Increasing social benefits to help the poor and the unemployed will simply send public debt through the roof, with cash-strapped taxpayers unable to carry the additional burden. Will the government try to calm tempers by nationalizing banks, industries, services, the media and farms and by distributing land to the people?
A weak economy has condemned our efforts to confront Turkey in any possible way available to us, which could have come through smart handling of our natural gas finds and western Europe’s desperation to cut Russia’s umbilical chord of energy supplies. At least, we seem to have improved ties with Israel in efforts to share our eastern Mediterranean resources, even though diplomatic gaffes continue to upset our new-found allies.
Instead, what is needed is quick thinking, a speedy conclusion of the bailout programme, a revival of our banking sector, regardless of international pressure to consolidate and impose harsher transparency rules, and for the rest of our European partners to reinstate their trust in Cyprus.
There is an art to diplomacy that comes out of smart thinking, consistency and reliability. Openly criticising EU leaders, saying they are out to suck our blood, will get us nowhere. We need calm and convincing arguments. We need to show that we are genuine when it comes to making pledges about reforms. We need to persuade our partners that we will not have another five years of disastrous economic policies. No one is twisting our arm to give in to Turkish demands and cede anything to the occupiers from the north.
Cyprus needs a government of national unity, one that will rekindle the “economic miracle” we last saw after the total destruction of our economy and society in 1974.
Voters in the first round have also given a clear message – that apathy rules and apathy is the worst enemy of any democracy. We are witnessing changes that will lead to the final downfall of the smaller, rigid political parties, that could also result in a continued erosion within the communist Akel party, unless they, too, do some serious soul-searching and come out of this battle as a reformed and truly progressive movement.
In the meantime, the only choice we have left is to support Nicos Anastassiades and his promise to open up to all ideologies, by embracing his pledge to introduce reform and fresh standards of meritocracy. It is the only way to move forward.
