KEVE: Brexit to affect trade, won’t benefit Cyprus
The Cyprus Chamber of Commerce and Industry (KEVE) said that the U.K.’s withdrawal from the European Union will not be to the benefit of Cyprus because it is the island’s second most important trading partner.
The impact of a Brexit wil be greatest if the UK renegotiates its trade accords with the EU, the Chamber said.
According to 2015 trade data, the UK accounts for 9% of imports to Cyprus (second after Greece) and 7% of exports, primarily in the services sector.
Tourism could also be affected, KEVE said, as the UK accounts for 40% of all arrivals (over 1 mln tourists) and more than double of the second-best market of Russia.
Tourism revenues from British tourists were over 35% of all tourism receipts, at EUR 800 mln, and the impact could be felt if the Sterling is weakened against the euro to the exit. Furthermore, new regulations, such as visa requirement and the cost involved could make Cyprus an unattractive destination.
The Chamber said that other negative factors are related to Britons living permanently in Cyprus, as well as new accords related to the Sovereign Base Areas.
But of equal importance will be the absence of Britain from important decisions within the EU, many of which are related to the economy, especially as Cyprus and the U.K. have similar views on many such issues, while the bigger burden of contributions to EU funds will be even more felt.
Finally, there is the matter of the very large number of Cypriot students in British universities, who benefit from lower fees that are equal to those paid by local Britons, and the ever growing number of Cypriots seeking work in the U.K. which could become difficult if Britain leaves.
“What is for sure is the insecurity, both for the U.K. and the EU, including of course Cyprus, because no one knows what will happen to EU relations with the U.K.,” the Chamber said.
The Chamber is co-hosting an event on the Brexit issue at the Conference Centre in Nicosia on June 7, with the participation of the Cyprus-British Business Association, the Chartered Institute of Accountants and the Institute of Chartered Accountants of England and Wales.