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By Constantinos Petrides
Minister of Interior *
The House of Representatives has kicked off the discussion over a legislation which is is to see the creation of an Under Secretariat for Development. This junior ministry is to take on the task of promoting and attracting investments to the island, also addressing challenges and obstacles faced by investors wanting to invest in Cyprus.
One of the tasks of the junior ministry is to act as a “one-stop-shop” for strategic investors. The idea is that it will not only take on the task of reviewing and evaluating the various applications from investors, but also to act as a proper one-stop-shop, handling all the paper work, from company registrations, to tax registrations, to social insurance obligations, etc.
I've been hearing about the need for a one stop shop ever since I was at school. I remember endless criticism over how neither the ordinary citizen nor a possible investor had a specific point of reference. Currently, there is not one specific point of contact between a strategic investor and the state. And with up to 47 departments involved in such procedures, the investor is being ping-ponged from one state service to another.
For things to change, a transformation of the legal framework needs to take place, in order to provide investors with a simplified licensing system and a clearly defined contact point. According to the proposed legislation [for the junior ministry for development], the services involved will be compelled to complete the tasks assigned to them within the given timeframe. The current situation does not go down well with investors, but also costs the country in terms of its reputation and credibility. While Cyprus is rated well with some rating benchmarks – such as the Doing Business in Cyprus – the overall rating of the country is brought down by the bureaucracy of the state apparatus when it comes to licensing. All of these have been taken into account, and after consulting with experts from the EU, we drew up the proposed bill.
The idea is that the junior ministry for development is to act as a project manager coordinating the various departments.
Coming back to why a legal framework is so important. In Cyprus we are also suffering from the fact that much legislation passed by the House of Representatives is never implemented. One of the reasons is that when legislation is drawn up, they do not take into account whether the necessary resources and governance framework exist.
The proposed legislation focuses on the creation of the junior ministry in order to close the governance gap, which does not exist in other countries. By closing the governance gap we will put Cyprus on the track of becoming a modern investment destination.
I am gload to see that the House is also on the same line of thinking. The parliamentary internal affairs committee chairman has also stated that the success of the legislation lies in the governance framework which is to be implicated.
Unfortunately, the House has yet to conclude the discussion regarding the junior ministry for development which is to undertake the aforementioned one-stop-shop task, although the House has opened up the floor to discussion and from where I stand, I do not see substantial differences in views.
However, as the issue is pressing, we urgently need to find ways to move forward. The issue was brought before the parliament more than a year ago, but was hindered by the various elections that took place. We all agreed at the opening session of the current parliament, that if we cannot agree on the creation of a junior ministry, we need to take a look at alternative solutions.
The issue is not what to name the baby, but to find ways to implement a framework which will make Cyprus a modern and attractive investment destination.
* Transcript from a statement on CyBC radio.
