... and why many sec­tors are not yet lib­er­alised

Financial Mirror (Cyprus) - - FRONT PAGE -

For­tu­nately, the gov­ern­ment found a way to over­come the un­ac­cept­able bill aimed to close shops on Sun­days. This bill, with all sorts of non­sense and gib­ber­ish, found many of us to­tally op­posed. Li­mas­sol, the star of tourism, Lar­naca, Paphos, etc. are not con­sid­ered tourist ar­eas and the rea­son is be­cause our MPs can’t be both­ered about the so­cial fab­ric (new words for our vo­cab­u­lary), while this so­cial fab­ric it­self does not ex­ist in Par­al­imni , Latchi etc.

So, ac­cord­ing to the pro­posed bill, stores up to 150 sq.m. would be al­lowed to op­er­ate, while shops of 152 sq.m. would not. If you were in this cat­e­gory, the best thing to do would be to sep­a­rate a part of the store (on Sun­days only) with some false par­ti­tion, so that the store of 180 sq.m. on Sun­day alone is re­duced to 150 sq.m. And what is in­cluded in the area of a shop? The cov­ered ve­ran­dahs, un­der­ground stor­age, the pave­ment where goods are dis­played? What if a store, which is not a sou­venir shop, also of­fers lo­cal tra­di­tional dishes. So, a store of 300 sq.m. could on Sun­days add some cheap “trin­kets” made in China, bot­tles with sweets, etc., as well as the rest. What, then would this shop be – a store, gift shop or eatery?

The ar­gu­ment used by the ma­jor­ity of our cog­ni­tive MPs to sub­sidise the small store own­ers em­ploy­ing 2-3 peo­ple was that the large stores had be­come mo­nop­o­lies. So, the “small” stores would work on Sun­days and this would help build the so­cial fab­ric for the large ma­jor­ity? Is this not a con­tra­dic­tion?

All this talk about mo­nop­o­lies and mo­nop­o­lies, but the most mo­nop­o­lis­tic “store” is the phar­macy. Ob­serv­ing the ‘stan­dard bearer’ of this ef­fort, DIKO MP An­ge­los Vot­sis (a phar­ma­cist), ar­gu­ing the rea­sons for his party main­tain­ing this po­si­tion raises many ques­tions (although AKEL’s op­po­si­tion to cap­i­tal­is­tic abuse on Sun­days is per­fectly un­der­stand­able based on their ide­ol­ogy). Given the re­stric­tive reg­u­la­tions for phar­ma­cies, there is no other more re­stric­tive mo­nop­o­lis­tic ac­tiv­ity in Cyprus – dis­tance from one phar­macy to an­other, late night ser­vices that are not so (but are obliged to open up if we call them). We should re­ally see what would hap­pen to Mr Vot­sis if the phar­ma­cies sec­tor is fully lib­er­alised.

Now we come to the casino and to the pro­posed bill where here too there is com­pe­ti­tion among the par­ties to see which one will im­pose the most re­stric­tions. Start­ing from the smok­ing ban (con­sider the ex­am­ple of a casino project in Spain that was turned down by Amer­i­can in­vestors be­cause of this), while in the Las Ve­gas-type casi­nos, which we want to copy, smok­ing is per­mit­ted only in the play­ers’ rooms, out­side of other spa­ces such as restau­rants, show halls, etc. An­other party ex­plained that the 15% tax on in­come should be grad­u­ally in­creased to 30%. How bright th­ese party of­fi­cials are to be­lieve that hordes of for­eign in­vestors are wait­ing in queue to pump in 500 mln eu­ros. If a truly “free” casino is built by our most com­pet­i­tive coun­try, Malta, then we have lost the game be­cause maybe our re­gion will not be able to sup­port both. So the first casino will win the bet.

The lib­er­al­i­sa­tion is based on the ef­forts by the state to in­crease rev­enue, boost tourism and hence help cre­ate de­mand for prop­erty (which in­volves every­body from bor­row­ers to banks). Fur­ther lib­er­al­i­sa­tion is also needed in other ar­eas as well, such as open­ing hours of banks, the public ser­vice, reg­is­tra­tion of com­pa­nies, etc.

The “curse” in this coun­try is our out­dated men­tal­ity and the lack of af­fec­tion for Cyprus from var­i­ous par­ties con­cerned. For ex­am­ple, what is a fan card needed for, asked a party of­fi­cial who be­lieves that be­lieves hooli­gans from his team’s sup­port­ers will be mon­i­tored? Who cares about 7,000 un­em­ployed sim­ply to help 200-500 small shop own­ers sur­vive? Why did the plan for build­ing amnesty fail, why did the plan to con­vert old touris­tic units into apart­ments for sale fail? Why, then, is there a de­mand for 30% of young peo­ple to be­come teach­ers? Is it be­cause par­ties and politi­cians are be­ing black­mailed by the po­ten­tial list of 1,000 unap­pointed teach­ers just as the strikes in hos­pi­tals were for pay in­creases and noth­ing else? Why should air traf­fic con­trollers earn 150,000 eu­ros a year? Why, then, has a par­tic­u­lar party sug­gested that the casino li­cense must also in­clude a golf re­sort? Where in Las Ve­gas have they seen such re­sorts, un­less the aim is to serve the in­ter­ests of friendly de­vel­op­ers.

In all this mess of cor­rup­tion in the po­lit­i­cal scene and oth­ers, we are still try­ing to at­tract for­eign in­vestors. As an of­fice we un­der­took a pro­mo­tional “of­fen­sive” (as stated by the Ir­ish prime min­is­ter) to at­tract for­eign in­vestors into Cyprus prop­er­ties, and what did we get in re­turn? Sev­eral mostly neg­a­tive re­sponses and who lis­tens to the Pres­i­dent of the Cyprus In­vest­ment Pro­mo­tion Agency (CIPA) nowa­days who says that we are not pro­ject­ing a good im­age and we are push­ing away po­ten­tial in­vestors. Even for the Arch­bishop’s devel­op­ment project in Yeroskipou, sud­denly two other com­pa­nies have cropped up with the iden­ti­cal plans who are in­ter­ested. Where were they all this time? Were they per­haps driven by jeal­ousy or by some oth­ers sim­ply to de­lay this project?

Un­for­tu­nately, we don’t have the right in­ves­tiga­tive jour­nal­ists who will dig deep into th­ese is­sues and ex­pose those at fault, and so there is no an­swer. There are only a hand­ful of ra­dio pre­sen­ters that I hear of nowa­days, but even their work and reach is re­stricted, but even that is some­what nec­es­sary to al­low democ­racy to func­tion prop­erly.

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