Breaking news

Extended Drought And Water Scarcity Top Risks For Cyprus’ Economy

by THEFUTURE.TEAM

Critical Risk Factors Identified

A detailed risk assessment conducted by the Cyprus Council of Economy and Competitiveness has identified extended drought and water shortages as the preeminent threats to the nation’s economy. Released at a press briefing at the Ministry of Finance, the report underscores that these environmental challenges, along with cyberattacks on vital infrastructure, deteriorating climatic conditions, shortages of skilled labor, and delays in digital transformation, pose significant risks to economic stability.

Rigorous Analysis And Methodology

The study, now in its fourth consecutive year, utilized a combined probability and severity index to quantify each hazard. Evangelos Tryfonos of the Council and Panagiotis Panagiotou, Director of Pulse Market Research, led the presentation, offering a detailed breakdown of the data. According to Tryfonos, a staggering 91% risk index was assigned to prolonged drought and water scarcity, eclipsing other threats that registered between 79% and 82%.

Structured Risk Categorization

Panagiotou further elaborated on the findings by grouping the identified risks into four strategic categories: geopolitical security and external shocks, institutional fortification and structural challenges, social and environmental resilience, and macroeconomic stability. This classification not only clarifies the origins and potential impact of the risks but also aids policymakers in prioritizing preventive measures.

Insights For Policy And Corporate Strategy

While the overall severity of risks remains stable across all categories, variations in the likelihood of these events were observed. Notably, institutional and structural risks emerged with the highest probability, signaling a critical area for policy intervention. “This sends a clear message that through proactive measures and targeted policies, we can mitigate adverse outcomes,” the report emphasized.

Collaborative Approach To Economic Resilience

In response to queries regarding the utilization of these studies, Dimitris Georgiadis, Chairman of the Council, noted that discussions about risks and the implementation of safeguards are not undertaken by the Council in isolation. They form a part of a broader dialogue that includes the Ministry of Finance, the Central Bank, and the Fiscal Council. This collaborative effort has heightened public awareness and sharpened the focus on critical economic vulnerabilities.

Digital Transformation Under Scrutiny

Addressing concerns over digital transformation, Georgiadis remarked that while the research does not prescribe immediate actions, it makes clear that the economic community in Cyprus views the current pace of digital adoption as insufficient. Bureaucratic delays, challenges in attracting appropriate labor, and other obstacles are impeding the necessary digital shift. Ongoing discussions with relevant ministries and agencies are aimed at accelerating these reforms.

As Cyprus navigates these complex challenges, the insights provided by this comprehensive risk assessment serve as a vital roadmap for both policymakers and industry leaders intent on safeguarding the nation’s economic future.

Mercedes-Benz Posts Higher Profit Despite China Slowdown

by THEFUTURE.TEAM

Mercedes-Benz reported stronger-than-expected second-quarter results, lifting its shares on Tuesday despite mounting pressure from Chinese automakers and a weaker outlook for sales and revenue.

The earnings provided a boost for Europe’s auto sector, where manufacturers continue to grapple with tariffs, softer demand and intensifying competition from Chinese rivals. Volkswagen, Mercedes-Benz and BMW have all accelerated restructuring efforts in response.

Cost Discipline Lifts Quarterly Profit

Mercedes-Benz shares rose as much as 5.9% following the results before trimming gains to trade 3.5% higher by 1118 GMT. The company reaffirmed its profit margin guidance for its core passenger car business after reporting an adjusted return on sales of 4.0% for the second quarter, above market expectations and within its 3% to 5% target range.

“In an environment where some automakers are ringing alarm bells on their competitive positioning, Mercedes delivered a clear and confident message,” Morningstar analyst Rella Suskin said.

Second-quarter operating profit increased 22% to €1.5 billion ($1.7 billion), despite a 3% decline in revenue. Lower administrative and research and development costs, together with strong performances from the financial services and vans divisions, supported earnings, while the results also included a €131 million gain related to the planned sale of leasing subsidiary Athlon.

China Remains The Key Pressure Point

Despite stronger profitability, Mercedes continues to face a challenging market environment. Sales in China fell 30% during the second quarter, prompting the company to abandon earlier expectations for stable car sales and group revenue. It now expects both to decline slightly from a year earlier.

BMW also lowered its outlook in June following a deeper-than-expected slowdown in China, highlighting the pressure facing Germany’s premium carmakers. At the same time, Mercedes said Chinese manufacturers are increasingly expanding into European markets, although Chief Executive Ola Kaellenius said their focus remains on higher-volume segments rather than the premium market.

“But that is not a reason to sit back and be relaxed,” he said.

Manufacturing Shift Continues

Mercedes is also reshaping its manufacturing footprint. The company said its German factories will undergo a more aggressive push toward leaner production, although it declined to provide further details while talks with labour representatives continue. Production is also being expanded in lower-cost Eastern European locations, including Hungary, where the company is increasing capacity at its Kecskemet plant, as well as in Poland.

Chief Financial Officer Harald Wilhelm said the full-year margin for the passenger car division is expected to come in at the lower end of the company’s guidance range, reflecting a higher share of electric vehicle sales in Europe, which remain more expensive to produce and continue to weigh on profitability.

“We must continue to work flat out to reduce costs so that we can remain competitive on the prices of our products,” Kaellenius said.

Uol
The Future Forbes Realty Global Properties
eCredo
Aretilaw firm

Become a Speaker

Become a Speaker

Become a Partner

Subscribe for our weekly newsletter