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Cohesion Policy Program ‘THALEIA 2021-2027’ Accelerates Social Inclusion In Cyprus

Program Advancement And European Endorsement

The General Directorate of Development at the Ministry of Finance has confirmed that the “THALEIA 2021–2027” Cohesion Policy Program is progressing at a robust pace. With over 100 projects either in progress or completed and approximately €700 million already deployed, the initiative is setting the stage for transformative social and economic reforms in Cyprus. This update was delivered during the visit of the European Parliament’s Committee on Employment and Social Affairs (EMPL) delegation, underscoring the program’s alignment with EU strategic priorities.

Strengthening Partnerships And Best Practices

The delegation’s visit served as a platform for exchanging experiences and best practices in employment and social inclusion policies. Delegates had the opportunity to inspect a series of EU co-financed projects on the ground, providing concrete examples of how targeted investments are enhancing the quality of life for communities across Cyprus. This collaborative approach not only reinforces policy coherence but also paves the way for innovative solutions in tackling unemployment and social disparities.

High-Impact Projects With Social Returns

Among the flagship projects under the THALEIA initiative are:

  • Organization And Operation Of The Inspection Service – With a budget of €8.5 million, this project, managed by the Ministry of Labor, aims to intensify labor inspections, advance the ERGANI II system, and implement an electronic records platform to improve service delivery for both employers and employees.
  • Ackida Center For Family Intervention And Autism Support – Budgeted at €6 million, this initiative in Nicosia focuses on providing comprehensive assessments, therapeutic interventions, and counseling services to support children and families, under the supervision of the Department of Social Integration for Persons with Disabilities.

Financial Commitment And Strategic Deployment

The THALEIA program commands a substantial budget of €1.8 billion, comprising €969 million from the European Union and €842 million from the national treasury. To date, more than 100 projects have been implemented or completed, with approximately €700 million disbursed towards impactful actions. This strategic financial mobilization is central to driving significant progress in labor market participation and social cohesion.

Measurable Social And Economic Outcomes

The program is poised to deliver extensive benefits, including:

  • Creation of 6,000 new job opportunities for unemployed individuals by October 2025.
  • Engagement of 1,100 new graduates in practical training assignments.
  • Support for 540 young individuals outside the employment, education, or training sectors through guided market integration.
  • Deployment of 35 community social workers across 19 municipalities and 255 local communities, addressing approximately 2,700 cases.
  • Provision of subsidies covering tuition fees and meals for 25,000 children aged four years and younger.
  • Annual social inclusion initiatives that benefit 27,000 students, with a supplementary 65,000 students participating in a school breakfast program.
  • Extensive support for persons with disabilities, including 23,000 assessments, 12 independent living homes, 8 personalized programs, and in-home care for 130 individuals.

Conclusion

The recent EMPL visit has shone a spotlight on the breadth and depth of the THALEIA program’s interventions. By catalyzing employment opportunities and strengthening social cohesion, this initiative underscores the pivotal role of European cohesion policy in enhancing the socio-economic fabric of Cyprus. As the program moves forward, its achievements to date offer a compelling blueprint for sustainable development and inclusive growth across Europe.

Bank of Cyprus Upgrade Signals Fresh Optimism For Greek And Cypriot Banks

Regional Banks Enter A More Favorable Cycle

Bank of Cyprus and Eurobank are well positioned to benefit from a renewed re-rating of Greek and Cypriot bank stocks, according to Cyprus-based investment firm Roemer Capital, which upgraded Bank of Cyprus to a buy rating and reaffirmed its positive view on Eurobank.

The firm cited easing geopolitical tensions, resilient economic growth in Greece and Cyprus, lower funding costs and Greece’s expected transition to developed-market status as the main factors supporting the sector.

Roemer Capital also lowered its cost of equity assumptions, updated its forecasts following first-quarter 2026 results and extended its valuation horizon to the end of 2027, raising target prices across its banking coverage.

Bank Of Cyprus Gets The Largest Upgrade

Bank of Cyprus received the biggest revision, with Roemer Capital upgrading the stock from hold to buy and setting a target price of €11.10, implying potential total upside of 27%.

The firm highlighted the bank’s strong capital generation, profitability and projected 100% dividend payout, describing it as the strongest capital-return story among the banks under coverage. Roemer Capital maintained its buy rating on Eurobank, assigning a target price of €4.90 and forecasting potential upside of 28%. The report said the bank is well placed to benefit from loan growth, improving operating performance and merger-and-acquisition synergies.

National Bank of Greece and Piraeus Bank also retained buy ratings, with expected returns ranging from 25% to 36%. Optima Bank was upgraded to buy, while Alpha Bank remained at hold on valuation grounds.

Why Growth Still Sets The Region Apart

According to Roemer Capital, Greek and Cypriot banks continue to benefit from stronger economic fundamentals than many western European peers. The report pointed to faster economic growth, healthier balance sheets, low levels of non-performing exposures, capital ratios approaching 20% and strong customer deposit bases.

Analysts expect performing loans across the sector to grow at a compound annual rate of 6% to 8% through 2028, supported by private investment, digitalisation, green manufacturing, supply-chain expansion and a gradual recovery in household lending.

The report also said the conclusion of lending under the EU Recovery and Resilience Facility is unlikely to materially affect credit growth, as banks have already shifted back towards traditional commercial lending. Roemer Capital expects Euribor to remain between 2.2% and 2.5%, a level it believes should support both lending activity and net interest margins.

Geopolitics, Valuation And Market Structure Support The Case

The report said improving geopolitical conditions have strengthened the investment outlook, noting that Brent crude prices have largely returned to pre-war levels while Greek government bond yields have stabilised at around 3.5%. Although geopolitical risks remain, Roemer Capital believes the likelihood of a major inflationary shock or significant pressure on bank profitability has eased.

Another important catalyst identified by the firm is Greece’s expected promotion to developed-market status by FTSE Russell, STOXX and MSCI over the coming months.

According to the report, the reclassification should improve liquidity and attract a broader base of international investors. Roemer Capital also said Euronext’s acquisition of the Athens Exchange is expected to strengthen market infrastructure and increase international visibility, particularly for Bank of Cyprus and Optima Bank.

The firm noted that Bank of Cyprus has already benefited from its Athens listing, with average daily trading value increasing from less than €400,000 before its September 2024 move to nearly €6 million afterwards.

Economic Momentum Remains A Core Tailwind

Roemer Capital said both Greece and Cyprus have moved beyond post-crisis recovery and are now supported by private-sector-led growth. For Cyprus, the report highlighted recent tax reform and efforts to simplify the legal and regulatory framework, while also noting that limited foreign banking competition continues to support domestic lenders.

Overall, Roemer Capital expects Greek and Cypriot banks to remain well-positioned for profitable loan growth over the coming years.

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