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Don’t ignore the financial losses of a non-solution

29 February 2016

Focusing on the cost of funding a solution and ignoring the financial losses of a non-solution is a mistake, Greek Cypriot Finance Minister Harris Georgiades has said.

In an interview with Greek Cypriot daily Simerini on Sunday, the minister said:

“My perception is that there is appreciation and expectation that reunification will bring new opportunities, new investments and new jobs. And this is the view that I share.

“Second, I think it is wrong to be concerned about only the potential cost of the solution and ignoring the cost of non-solution. Unless we come to a very strange and perverse conclusion that the solution and the reunification of our country is not economically advantageous.”

Georgiades said that a reunited Cyprus, free of Turkish occupation and with the implementation of the EU acquis across the whole island would be “a developmental leap”.

He pointed to the fact that Turkish Cypriots would benefit from EU membership; while Greek Cypriots would have the opportunity to expand into the Turkish market via the tourism, shipping and other business sectors.

“And everyone will of course benefit from stabilisation and security,” he added.

There would need to be dependable system of public finance management, proper supervision of the banking system and financial framework which encourages new business and investments.

Asked about the cost of creating one federal government and two separate administrations complete with public services, Georgiades said: “Today there are two structures, two public administrations and two police departments. Those of the Republic are of course legitimate and internationally recognised and those of pseudo state operate outside legality but being but outlawed does not mean the public service and the police in the puppet regime does not mean that today there is not already an economic cost. The important thing is to have strict and clear rules for economic governance, which comply with European rules, both for [constituent] states and the federation.”

Referring to the idea of unfair competition from the North, Georgiades said there was uncontrolled operation of casinos, hotels and universities in the North, however, reunification would resolve this, as they would be required to comply with EU rules.

“This will bring economic opportunities,” he said. “Of course the solution first and foremost is important for national reasons, and reasons of security and the survival in our homeland. But I think there will be opportunities for all. It will certainly not be a zero-sum game,” said Georgiades.

Georgiades said there were ongoing discussions with the IMF and the World Bank which are working with technical teams in Cyprus to find an economic solution.

“There is a very large volume of issues that need to be sorted out,” the minister said.

Cyprus Mail

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