The full text of the greeting of the President of the Republic Mr. Nikos Christodoulides at the Annual General Assembly of OEB.
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It is, as always, a great pleasure to participate with the entire Council of Ministers in the General Assembly of the Cyprus Employers and Industrialists Federation (OEB), a timelessly responsible and reliable voice in the economic and social life of our country. A stable and serious institutional partner of the State, which over time contributes substantially both to the public debate and to policy-making, especially on issues of our economy and society, in general.
My presence at today’s assembly proves both our strong conviction and the need for a continuous and substantial dialogue with you for the co-formulation of policies based on the real needs of the business community, those policies that will further strengthen the resilience and competitiveness of the Cypriot economy and will lead to further development in our country.
You are well aware, you have seen concrete examples of writing that from the first day we took office, we have set as a priority the need to strengthen the competitiveness and extroversion of the Cypriot economy, and I am very pleased that in this great effort the business community of our country as a whole is a partner and companion in the implementation of the collective vision for the creation of a modern Cyprus. sustainable, competitive and innovative.
For us, there is absolutely no doubt about the fact that there can be no resilient economy without strong businesses. There is no sustainable development in any country without strong private initiative. And there can be no healthy social cohesion without opportunities for all. It is this basic principle that governs our policies at all levels: from taxation and investment, to employment, energy, digitalisation and the green transition.
The current international environment continues to be characterised by great uncertainty. Geopolitical tensions, the protracted crisis in the Middle East, the uncertainty in Ukraine following the Russian invasion, the instability in energy markets and the turbulence in international trade are some of the factors that create major global challenges. Our country, despite its small size, is not isolated from the effects of these geoeconomic and geopolitical developments.
On the contrary, we are well aware that our stability and prosperity also depend on our ability to adapt, innovate and strengthen our position in a fluid and competitive international environment. And, above all, to be resilient and competitive. I read with particular interest the two interviews of the President of OEB over the weekend, which refer to the issue of resilience and the impact that we will see in the coming years. Only if we are resilient and competitive will we be able to face any challenges.
Today’s multiple and multi-layered challenges prove the correctness of our responsible politics, far from populist approaches and policies that in the past we have all paid very dearly. A policy that, with the strengthening of our diplomatic footprint – there can be no separation of domestic and foreign policy – has established the view that our country is in deed, and not in words, a pillar of stability in the region, thus creating many advantages for the economy in our country.
At the same time, we are a proud member state of the European Union (EU) and the unity of our European family is our strongest defense against international developments, but also any tendencies by some to introversion and protectionism. And it is positive that this unity in the EU has already begun, albeit due to external factors, to be translated into practice through a systematic and accelerated effort to strengthen the Union’s competitiveness and reduce bureaucracy, which is a brake on the strengthening of productivity. And taking over the Presidency of the Council of the EU in the first half of 2026 is a unique opportunity to run further on these issues, to further highlight our role as an active member of the EU, as a truly reliable partner that essentially promotes the European agenda and any relevant initiatives.
One of these initiatives, the European Commission’s ‘Competitiveness Compass’, proposes a clear strategic framework for a more competitive Europe, with less bureaucracy. Through the targeted exploitation of this framework and moving quickly and immediately, without lengthy discussions, the European economy can strengthen its resilience and be clearly better prepared to play a leading role, and not just to follow, to be able to successfully absorb external shocks and global turbulences, without being the tail end of developments.
At the same time, at the national level, our country is called upon to face the current situation with seriousness, with a concrete plan and with boldness. In this context, we have moved forward from the first day of taking office and continue on the basis of the triptych: fiscal responsibility, a strong financial system and sustained and bold reforms. It is precisely on these pillars that we are building the new production model of our country. And we do it consistently and methodically.
And I am glad, because in this great effort we are moving forward together and the results are evident even to the most skeptical of the very good course of our economy. Cyprus is changing in practice, through strategic planning, determination and measurable results. In 2024 we achieved a growth rate of 3.4%, one of the highest in the Eurozone, while the forecast for 2025 is around 3%. Unemployment fell below 5%, with youth unemployment showing the largest decline among EU countries, and employment reaching 80%. At the same time, through our responsible fiscal policy, the primary surplus for 2024 has exceeded 4%, while the public debt has been significantly reduced with a target, which is feasible, to be below 60% of the Gross Domestic Product (GDP) by 2026. And all this in the midst of two wars and with strong economies of the Eurozone facing very serious problems and challenges.
At the same time, a vote of confidence in our responsible fiscal policy is also the continuous upgrades of Cyprus’ credit rating by rating agencies, which now rank us in investment grade A, while the International Monetary Fund (IMF) points out that Cyprus has an economy that is “flexible, resilient and with significant potential for further growth”. I repeat that these developments are of particular importance, if we consider the difficult conditions prevailing in the international environment, in the geopolitical scene and the consequences they have for the global economy, but also for the economic data of strong EU Member States.
At the same time, I want to make it clear, and in this way respond to some arguments, that what I have mentioned above cannot be summarized in what some people claim, for their own reasons, that in our country the numbers are simply prospering. The upward course of the economy and the continuous upgrades translate into concrete results, tangible advantages for businesses, for households and for the entire Cypriot people, such as:
- Attracting high-quality investments that create new, well-paid jobs, especially for the younger generation. And we have seen it in practice with our recent contacts in the United States of America (USA) with the Deputy Secretary to the President and the Deputy Minister for Research, Innovation and Digital Policy. Following our contacts, we had Amazon in Cyprus on April 14 and 15, Plug and Play on May 5 and 6, and we will have other companies such as Microsoft, Google, etc. They are coming very concretely, to open research and innovation centers in our country, to employ our compatriots, and all this is the result of responsible economic policy.
- At the same time, to answer those who say that only numbers prosper, the state of the economy has brought lower interest rates, as countries with strong credit ratings tend to enjoy more favorable lending terms.
- Improved economic stability, leading to greater job security and improved wages.
- And of course, the strong, good economy enables the State to pursue targeted social policy and invest in sectors such as Health, Education, the Welfare State, Digital Transformation and, more generally, policies for the benefit of the entire Cypriot people.
What I have mentioned above, I would like to emphasize in the most categorical way, does not lead us to complacency. That would be a huge mistake. Our goal, and what matters, is to build a sustainable, resilient and competitive economic model. A model that incorporates innovation, knowledge, but also environmental responsibility and social cohesion. In order to achieve such a model, we implement a very specific plan. For example, through Invest Cyprus we are implementing a campaign to restore our country’s reputation and credibility abroad. And in this great effort, which I am happy to say brings results, we want you all to be allies. For a single voice, with a single narrative, to promote the new image internationally: the Cyprus of transparency, technology, quality, innovation.
An integral part of this strategy is to attract quality investments. In our recent visits to the USA – New York, Houston and Silicon Valley – we have seen the positive change in the image of our country and the real interest in productive and quality investments of high added value, which are accompanied by the creation of new, well-paid jobs. In all the meetings, the most basic question was what talent, especially in new technologies, exists in Cyprus. And in this context, but also taking into account the fact that unemployment is below 5% for the first time since 2008, on May 21, 2025, we are launching the Brain Gain campaign in London, to attract talented Cypriots working abroad and give them the motivation to return, create and contribute to the future of our country. And I am glad that so far more than 550 of our compatriots working in London have registered for the event, saying that they are interested in considering the prospect of returning to Cyprus.
A long-standing request of OEB, fully understandable, fully justified, is the fight against bureaucracy and the creation of a truly attractive business environment. In this direction, and responding to the needs of both local and foreign investors and entrepreneurs, I would like to announce today that on May 26, 2025, we are inaugurating the operation of the Business Service Center, an important tool for facilitating business action and strengthening the competitiveness of our country. This is an important step in our efforts for a Cyprus with less bureaucracy and better service, focusing on the needs of businesses and investors. The Centre will be the central point of contact for Cypriot and foreign investors with the Government on information issues and necessary investment licensing. Instead of making an application and the competent Ministry sending it to all the Ministries by letter, waiting for answers, making reminders, we are bringing all those who deal with licensing from the various Ministries into one place, so that decisions can be taken immediately.
In the same context, for 2025, the priority is also the adoption of the tax transformation that we presented last February, which is also a key tool for strengthening the competitiveness of Cypriot businesses. It was one of our main goals through the tax reform, and responding to your requests, to strengthen the competitiveness of Cypriot businesses and to deal with phenomena that can also be characterized as unfair competition.
With the abolition of the supposed distribution of dividends and the reduction of the defence tax on dividends, something that you had raised to me since our first meeting, the tax burden for hundreds of Cypriot companies is reduced, while valuable liquidity is released that can, and we hope, be directed to new capital investments. The reform is not limited to relief. It introduces targeted tax incentives for green and digital investments. Investments related to technological upgrade, energy efficiency and transition to a circular economy. Among our major goals is to make taxation a lever of transition and to strengthen our effort for the new economic model. And I want to assure you that we are moving forward at a rapid pace with the aim of completing the bills, and I am sure that the House of Representatives will also do what is necessary to start implementing the new tax framework from January 1, 2026 and to keep the discussions on tax reform out of the expected election campaign.
I am well aware that energy costs remain one of the biggest challenges to the competitiveness of our businesses. Our effort in this direction is multi-layered, some depend on us, some depend on third parties and, yes, I am optimistic that we will also face this great challenge.
Among others:
- We proceeded with the provision of incentives to enhance the utilization of Renewable Energy Sources (RES) and energy efficiency through specific sponsorships.
- We are in the trial market stage and the necessary checks are being completed for the opening of the competitive electricity market, immediately after the end of the summer season, in order to avoid any challenges due to the summer season.
- We have activated a Plan for the storage of energy from existing Renewable Energy Sources. The submission of applications was completed at the end of April, and the funding of the systems will soon begin. In addition, we are proceeding, after the passage of the necessary legislation, to the installation of a central storage system that will greatly help us to solve problems that arise.
- In addition, as I announced during the Annual Planning for 2025, a new RES Storage Plan for households and small businesses is in the process of being formed.
- The upgrade of the Dhekelia Power Station is also being promoted.
The second major challenge that you mentioned to me in all the meetings we had is to find the right workforce for businesses. It is a fact that – as a result of our economic responsibility and, by extension, growth – we have achieved a significant reduction in unemployment and we are happy to talk about full employment conditions in 2025. However, further economic development, which we all seek, also requires the appropriate human resources and this is something that we recognize and handle.
We have already adopted the revised strategy for the employment of workers from third countries with the aim of effectively targeting on the basis of the real needs of our businesses and the labour market and where the needs are not covered by the domestic market. At the same time, we have enriched the list of occupations, to which an exceptionally increased employment quota of foreign workers will be applied, as well as we have approved the possibility of employee mobility for placement in premises of the same employer, as well as the increase of the cut-off rate from the employee’s gross earnings for housing purposes from 10% to up to 25%.
A relevant agreement has also been signed with Egypt, which is starting to be implemented by the agricultural and livestock sector, and consultation is underway with India to sign a relevant agreement to secure a workforce where needs arise.
At the same time, improving service for all work issues is our main priority and I am glad that we have achieved a significant improvement both in speed and in service in terms of benefits. Indicatively, I would like to refer to the unemployment benefits that are now paid on average within a month and a half, and the requests for employment of foreigners that are processed within six weeks. Within 2025, the goal has been set for all benefits to be paid within one month.
An important priority in our efforts to reduce the impact of the increased regulatory burden on the market, but also to enhance competitiveness and productivity, is of course the digital transformation and the facilitation of interaction between the state and citizens/businesses.
Key actions for 2025 include the digital modernisation of public services with online application platforms, improving digital infrastructure and employee training, as well as improving interoperability between government systems for better cooperation.
An initiative that helped us a lot to face this great challenge, the Migration Issue, since until December 2023 the systems of the Ministry of the Interior were not connected to the systems of the Ministry of Labor, and this did not help us to face the great challenge called Migration. Therefore, our main goal is the interoperability of all the systems of our Ministries.
As an executive, we know that we cannot succeed on our own. Neither does the private sector itself. Success comes when we co-shape, when we work together. And this synergy is the most stable investment for the future of our country.
Cyprus may be small in size, but it is large in potential. If we work methodically, with a spirit of cooperation and a common vision, I have absolutely no doubt that we can achieve much more than we might imagine today.
And in this effort, OEB and Cypriot businesses have and will continue to have the support of the executive power. As we have proven so far, we will continue to be by your side with a plan, with determination and above all with consistency.
