So, then, what’s going on in Cyprus?
We convinced the investor that after the events of March 2013, we have learned our lesson on how to manage the economy and that Cyprus has nothing to do with Greece as regards the economy and non-conforming with reform measures. He suggested, then, that “I must be crazy to invest in Cyprus, but my Cypriot wife advises otherwise, while my counselors also advise me negatively.”
What has happened that the foreign investor is unconvinced, and to satisfy our concerns he sent us the following points in a latter:
• Cyprus has not fully complied with the Troika reform programme resulting in a loss in the economy of 500 mln, primarily due to the lack of privatisation of the semigovernment organisations.
• What chances do you have to introduce a national health scheme with nurses showing a finger to the Health Minister, a detail noticed by our Belgian client from a distance, while doctors refuse to punch time cards?
• Why are you turning away international companies from Larnaca, while on the other hand the state is trying to attract foreign investors?
• The differences between the public and private sector are far and wide. Is the restructuring of the public service going ahead?
• I did not understand how the National Guard will find the money for new armament systems and salaries for a professional army at an addition cost of 30 mln euros a year. This alone will not harm the economy?
• Is there no leadership in Cyprus beyond the parties? The leaders, your President has said, must lead and not to be carried away by the unions and by political parties.
• I invested 8 mln euros in Malta in building project, I registered companies in two days, the cost of a lawyer and accountant are 60% below that of Cyprus and the UK tax system, when one compares all that data are similar or slightly higher than Cyprus, but after all, that is London.
Another client, a Dutchman asked “what justice system is this? Our tenant does not pay rent and we have been in court for four years (without payment) and still waiting. From now on, for any new investments we will refer in our contracts to English law and certainly not Cyprus law. How is this consistent with the state’s aim to become an international arbitration centre?
“Who is this Ms. Zeta lady,” an Arab investor asked, referring to the Labour Minister. “How the Ministers of Transport and Tourism made a mess of the hotel sector, and yet, this woman reached a deal to secure labour peace in the hotels in negotiations that lasted until 3am. From now on, I will refer to this person to solve any potential future problems in my investment. “I have problems with my investment in properties worth mln, and yet the Commerce Ministry is completely
32 indifferent. Should I go to the Ministry of Interior or Finance for an intervention?
In another case for the purchase of three hotels in Paphos by an Indian investor Indus, his assistant called us saying that “we thought that there is a free labour market, while it is just the opposite with the labour costs reaching 35% of our operating cost, which certainly would not suit us.”
These are some of the letters and phone calls of complaints we receive, as do other professionals in the real estate sector.
These days it would be somewhat understandable if the complaints had come from locals and not foreigners, but it seems that foreign investors are more sensitive to detail than the rest of us locals and that foreign investors are constantly monitoring our economic situation.
In our economy that still has its problems it seems that Cyprus cannot escape the comments by foreigners and of course this worries us because despite all the enormous efforts made to attract foreign investors to Cyprus, at the end of the day foreign investors are still worried, which is not good news in efforts to attract new market entrants.
Unfortunately, the political parties and unions are largely to blame for destroying Cyprus, and they continue to do so by destroying the future.