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MP stresses importance of public investments for Cyprus

Cypriot MP Christiana Erotokritou stressed the importance of public investments for Cyprus due to the disproportionate immigration and demographic pressures the country is facing and the adverse effects of climate change. 

Erotokritou who is the President of the Cyprus House  Finance and Budget Committee, intervened in Budapest during a meeting of the Inter-Parliamentary Conference on Stability, Economic Coordination and Governance in the European Union.

In her intervention regarding Cyprus, she noted that the country is on a steady path of public debt reduction, maintaining healthy fiscal surpluses, however, it presents a large current account deficit.

She pointed out that the country-specific recommendations of the European Commission for Cyprus highlight the imperative need for full and timely implementation of the Recovery and Resilience Plan to reduce the country’s excessive dependence on oil and accelerate the completion of the necessary reforms and investments.

In this context, Erotokritou said it is important to have public investment for Cyprus due to the disproportionate immigration and demographic pressures the country is facing and the adverse effects of climate change.

Erotokritou stressed that the key challenge is to balance fiscal discipline and sustainable development, ensuring that fiscal responsibility, sustainable development and social cohesion go hand in hand and that the economic governance framework contributes to addressing current and emerging challenges of the EU and shaping a more hopeful future for all European citizens.

Keve Welcomes New Cyprus Business Development Organisation

The Cyprus Chamber of Commerce and Industry (Keve) has welcomed Parliament’s unanimous approval of legislation establishing the Cyprus Business Development Organisation, describing it as a major step toward improving access to finance for small and medium-sized enterprises, startups and self-employed professionals.

Expanding Access To Finance

The legislation creates a new public body aimed at addressing financing gaps by supporting businesses that struggle to secure funding through traditional channels.

According to Keve, the initiative could strengthen entrepreneurship, boost competitiveness and support Cyprus’ green and digital transition. The chamber has long argued that SMEs rely too heavily on bank financing, limiting investment, expansion and innovation.

Keve Calls For Swift Implementation

Keve said it helped shape the legislation through the consultation process and called for the organisation to become operational as quickly as possible. It also pledged to continue working with the Finance Ministry and the organisation’s management to support implementation.

How The Organisation Will Operate

Approved by Parliament on Tuesday, the legislation establishes Cyprus’ national business development body under the supervision of the Finance Minister, while the Central Bank of Cyprus will oversee anti-money laundering compliance.

The organisation will design financing programmes, provide loans and conduct studies to identify weaknesses in the financing market.

Cyprus will provide €60 million in initial capital. Over time, the body will also be able to raise funding from European and international institutions and benefit from state guarantees linked to approved strategic priorities.

Recovery Plan Milestone

Creation of the organisation is one of the final milestones under Cyprus’ Recovery and Resilience Plan and is required for the country to receive the plan’s ninth and final payment. Appointment of the board of directors remains the last outstanding step.

Before approving the bill, the Finance Ministry revised the draft following consultations with MPs and stakeholders. The changes removed provisions allowing the organisation to establish companies and narrowed the list of eligible beneficiaries by excluding small mid-cap companies.

Lawmakers also strengthened governance rules by introducing stricter board suitability requirements, conflict-of-interest safeguards, enhanced reporting obligations and borrowing limits. A seven-member board appointed by the Cabinet will oversee the organisation, while a transitional board will serve for two years until it becomes fully operational.

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