Even as tourism and construction showed weaknesses, the economic performance showed resilience, argued Finance Minister Constantinos Petrides speaking at the 10th AGM of the Cyprus Investments Fund Association (CIFA).
Petrides underscored the importance of cooperation of the private sector with the government and the regulator, the Cyprus Securities and Exchange Commission, in paving the way for more than €11 bln to find their way to Cyprus.
About €2 bln of that is invested in the local economy.
The case for reducing economic dependence over the past ten years on other more traditional sectors like tourism can be made.
However, the fund industry is only part of the flourishing financial services sector that saw substantial growth under the energetic and visionary guidance of Demetra Kalogerou, the former chair of CySEC.
True, she found an accommodating partner in the government during her term, the former minister of finance, Harris Georgiades.
Since 2019 the fund industry has grown by 47% to reach €11.7 bln, according to George Karatzias, Vice-Chairman of Cysec.
Karatzias attributed this success to the comprehensive institutional framework that was made possible through the combined efforts of the Finance Ministry, CySEC and CIFA.
The modernisation of the framework, according to Karatzias, was instrumental in channelling more than €300 mln last year alone to the energy sector and €110 mln in the shipping industry.
Therefore, the fund industry has been instrumental in channelling capital to other sectors and helping diversify our economy.
With the war raging on in Ukraine, financial pressures pose the most acute threat to every economy in Europe and worldwide, perhaps except for the big oil exporters.
Ironically, despite the sanctions, Russia has managed rather well so far, with the rouble restoring all its lost value.
Andreas Yiasemides, chair of CIFA, spoke of the industry’s competitive challenges and the good prospects ahead.
Finding new sources of income that bring high value-added to the economy is key in helping the economy of Cyprus ride the current tide as capital seeks shelter and sound returns.
Michael S. Olympios is an economist, business advisor, and Editorial Consultant to the Financial Mirror