24 | LETTERS
YOUR SHOUT What do you think?
Here at OPP, we really want to know your thoughts are on the issues that affect our industry. So tell us what you think about the latest news and what you’d like to see more of. OPP is the voice of your industry, so have your say by commenting on our LinkedIn Group, by e-mailing
amit.katwala@richmondgreengroup.com, or by tweeting us @oppnews ...
www.opp.org.uk | APRIL 2011
Gutless and mediocre politicians are destroying Cyprus’ good reputation Dear Editor
Every day that goes by without the Cypriot government taking action to constructively remedy its economy is disastrous, tarnishing the reputation that Cyprus enjoyed for more than two decades as a solid, reputable business hub and fi nancial centre. It is clear that the recent downgrades by both Standard & Poor’s and Moody’s are not taken seriously by the Cyprus government … because they only seem to worry about the outcome of the forthcoming elections. Shame on them … and on all the other political parties and trade unions whose public declarations and mumblings are gutless, confusing, mediocre and unworthy of whatever they claim to be!
These are times when
every cent counts. In times like these, the advantages that a country like Cyprus off ers, (i.e., strong and applicable legislation and sound regulatory system, the lowest corporate tax within the European Union and double-tax-treaty agreements with about 50 countries), should be attracting investors. Instead, Cyprus is downgraded, Cyprus is exposed, Cyprus is unable to convince the world that it can respond to market dynamics promptly and responsively. Worse, Cyprus cannot even convince its own people that it can manage. How can then Cyprus expect to attract investors? How can a potential investor be convinced that this country is sound enough to “entrust” her/his wealth or savings? We suff er from a lack of vision, from populism and demagogy, practiced devoutly by political and union leaders… and apathy that weakens the very foundations of the Island’s existence as a business hub and a fi nancial centre. Who would want to invest or live in a country that nurtures apathy like it was a virtue? Cyprus like every other nation has to realise that it exists within a globalised economic environment characterised by, amongst other things, unforeseen risks and increased volatility. How will the recent socio- economic problems of the nearby countries of MENA aff ect Cyprus? What if Saudi Arabia, the largest oil producer in the world is next? What if Greece ends up in a position where it cannot pay off its debts? What if other European partner nations follow the path of Greece? What if the U.S. falls into another recession, something that is more than likely to happen. What if Cyprus is forced by the EU to raise its corporation tax? It is all about effi ciency and excellence… and our leaders are characterized by mediocrity! If Cyprus is to prosper, it has to strive for excellence, it has to become competitive, and it has to accumulate capital. First and foremost by cutting unnecessary and primitive “non-logical axioms” such is the Cost of Living Allowance (COLA). COLA has to be eliminated. It only results in large increases in real wages and a deterioration in competitiveness of domestic companies, undermining fl exibility and competitiveness as it impedes relative wage adjustments across companies and sectors in line with productivity diff erentials. It imparts inertia to the public sector wage bill, making it more diffi cult to reverse the excessive growth of public sector wages and salaries. If you add all this to a policy (embraced by the governmental and semi-governmental sectors and most fi nancial institutions) that is not based on merit and performance, where people get jobs for life despite their performance, and where trade unions (that are infl uential and pampered by each and every government in power because of political cost and own benefi ts) infl uence management decisions… then you have a formula for self-destruction! A solution: Simply, incorporate the COLA
into the basic salary and from that point of time onward base salary increases on merit and performance! Corporate and personal income taxes have to remain intact. Income tax evasion should be handled but should not become a “psychosis” by establishing complex legislation and inspection – if procedures do not remain as simple as possible they will scare off investment and eliminate the entrepreneurial spirit that resurrected this country after the Turkish invasion of 1974. Recent studies imply that the size of the black economy in Cyprus cannot be more than 8.5%, one of the lowest in the EU. A solution: A high tax free income can help not only to reduce tax evasion directly but to also limit the potential tax evaders amongst higher earners. Adoption of such policy will even make tax compliance measures less costly to implement. It is imperative that the Cypriot government and every Cypriot should realize that time is running out, that sacrifices need to be made. It is not enough just to mend temporarily the current problems … a spirit of collectiveness, pride and transparency must compliment every effort undertaken. If not, the next global financial tremor will bring devastating effects… Cyprus, a smaller country will be unable to react… and that is when suffering will become a way of Cypriot life! It is not too late! We must act now. Harris Samaras. Chairman and CEO. Pytheas Investments.
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68