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Cyprus in 2025: Singapore or a failed state?

Δεκέμβριος 2, 2015

The text and video presentation in this post were prepared by my friend Vassilis Petrides in the Nicosia Global shapers event YOUNG PEOPLE #SHAPECYPRUS which took place in Ledra Palace on the 28th of November 2015.

It is best to read the text while watching the video.

 

Cyprus in 2025: Singapore or a failed state?

 

To make a prediction for the future, one has to first take a look at the past.

Some of you are probably too young to remember the ‘Back to the Future’ film trilogy that was a blockbuster in the 80s. In the film, a mad scientist constructs a time travelling machine based on what was then the coolest car of the era: the De Lorean DMC-12. In the sequel, Doc and Marty come back from the future, only to discover that their home town was in ruins and had come under the complete control of Biff, the corrupt school bully. To get back to the well run town that they had departed from, they went back in time and made sure that Biff would be prevented from ever reaching a position of power.

Sadly, in the real world, we don’t have a De Lorean time machine. Because if we did, we would certainly have gone back to the 60’s and made sure that Cyprus after independence would have had one single overriding aim: to forge a genuine partnership between the two communities and reject any nationalist or separatist ideas that were often inspired and directed by foreign powers. Instead, our politicians, politically naive as they were, did all they could to drive a wedge between Greek and Turkish Cypriots and fanned the flames of nationalism, through enosis and taksim to further their own political ends, serving at the same time their foreign patrons.

Consider if you will, two small island states both of which gained independence from Britain in the 1960s, both with diverse ethnic minorities and with strong associations to much larger patron states: Singapore and Cyprus.

Singapore, with a 75% strong Chinese majority had to integrate 4 ethnic groups: Chinese, Malay, Indian and Eurasian; 4 separate languages: Mandarin, Malay, Tamil and English; and 4 religions and cultures: Buddhist, Muslim, Hindu and Christian.

Cyprus needed to integrate just two ethnic groups, Greek speaking and Turkish speaking Cypriots, two religious groups, Christians and Muslims and merge customs and cultures most of which were common.

If you had asked an independent observer, which of the two island states had the best chance to improve in one generation, the bets would be on Cyprus. Instead, it is Singapore that has been the success story and the envy of the corporate world. Applying the principles of meritocracy, multiculturalism, adopting religious and ethnic tolerance, eradicating corruption and choosing English as the state’s official language, it has managed in the space of one generation to leapfrog from the Third World to the First. With 2% unemployment, it has the 3rd highest per capita income in the world, one of the only AAA sovereign ratings and is ranked consistently as the ‘easiest place to do business’ in the world. If you ask Singaporeans which ethnic group they belong to, they will most likely answer that they are Singaporeans first and foremost.

Cyprus was not fortunate enough to have a leader as visionary as Lee Kuan Yew. My generation’s future was stolen by politicians on both sides who were unprepared at protecting and nurturing the new found Republic and inept at leading the young nation into the modern world. Instead of working to build the foundations of the new state, the community leaders could not rid themselves of their biases and well honed convictions that enosis and taksim should be their main focus. The resulting events of 1963 and of 1974 sealed any hope that Cyprus could have become a Middle East Singapore in my generation.

In the years to 2015, Cyprus has shown a remarkable zeal and resolve to rebuild itself from the ruins of 1974, only to fall prey to excesses and lack of checks and balances by both the state and financial institutions, which ultimately brought the economy by 2013 to its knees. The economy has see-sawed wildly since the late 90s (resembling more a game of snakes and ladders than a fully functioning economy) and it is fair to say that outside some financial, shipping and service related sectors, the investment climate has not been lucrative to attract serious foreign investors.

What then, will Cyprus look like in 10 years time? Do we get to have a second bite at the cherry?

The answer to this depends entirely on which politicians, you, the next generation of post solution Cypriots, choose as your leaders. If you allow ethnic and religious biases and nationalism to foster, as we did in our generation, then you only have to look at the failed states surrounding Cyprus to conclude that Federal Cyprus will not last even a decade. For prosperity to take root, our in-born tendency for one community to dominate the other and splitting them apart should be avoided at all costs. If we do not fully integrate our societies, Cyprus will remain weak and prey to much larger and stronger competitors.

Our only hope to avoid the pitfalls and resist our natural instincts of hubris and dubious party politics is to demonstrate to our apprehensive population that economic prosperity is the answer. To maintain growth and prosperity, we have to cultivate and support a culture of meritocracy, tolerance and applying the rule of law and democratic values. If our aim is to become the Singapore of the Middle East, and it could well be within our means, then we have to project a different image of Cyprus than the one we have today.

Cyprus needs to take a long hard look at itself and decide which economic model it is best suited to follow in today’s competitive world. If, in my view, we choose a model based on a liberal free market economy, we should attune our institutions and policies to offer the best and most efficient means of doing business in Cyprus. We should aim to brand Cyprus as the most business-friendly country in Europe and the state should facilitate this goal by removing all bureaucratic obstacles, while maintaining strict vigilance. The new Federal Republic will offer a chance to remodel our economy on new foundations with an aim of attracting value added investments.

We must accept that economic growth is the only route out of our current malaise and this growth cannot be achieved by adding to our already exorbitant Government Debt, which will be under pressure with post unification funding. Sustainable growth will be achieved when foreign investors feel certain that Cyprus has corrected its erratic policies of the past and offers long term stability and potential for reward.

Entrepreneurship should be the glue that integrates our two communities and should act as a magnet to foreign capital. Just like Singapore, Cyprus should first understand the comparative and strategic advantages that we have to offer and target those industries and funds which will add most value to our economy. With smart choices, Cyprus entrepreneurs can offer international corporations an oasis of stability and security in a geographic region steeped with violence and unpredictability.

Ten years from now, a new generation of Cypriot businesspeople will seem nothing like today’s lot. No longer lining up to join the ranks of the civil service or the well protected banking sector, Greek and Turkish Cypriot entrepreneurs will set their sights on new horizons, working together in the private sector or with large multinationals. These will have made Cyprus their base benefiting from Cyprus’ unique location, a pool of well educated multilingual population, low tax status and export benefits.

Greek and Turkish Cypriot partnerships and joint ventures will spring up like mushrooms as trust and opportunities help overcome suspicions and distrust. The benefits to both communities will become visible very quickly. Larger and more efficient companies will cooperate and take advantage of economies of scale, rather than compete against each other in a single united market. Multilingual skills and cultural diversity will offer access to every corner of Cyprus and will help cement bonds between Greek and Turkish Cypriot businesspeople and employees within corporations. Greek Cypriot and Turkish Cypriot products and brands will find access to Turkey and Greece through trading firms using existing networks.

If Turkey manages to temper its autocratic nationalistic tendencies, it will join the ranks of the G10 in ten years time and Cypriot entrepreneurs would be well advised to study how to exploit such a large potential market. I predict a great interest for service companies (legal, accounting firms, IT etc.) offering support to Turkish corporations wanting to set up subsidiary companies in Cyprus taking advantage of double Tax Treaties and European status.

Add to this, the gas revenue that would come on stream, the multiplier effect from rebuilding Famagusta and other undeveloped areas, the new industries and jobs that would sprout from the casino industry, tourism to and from Turkey, merchant shipping trade, international investment in education and medical centres, as well as research and development, and Cyprus might be vying with Singapore as the ‘easiest place to do business’ by 2025.

Ultimately, it is up to all of us, but mostly you, the next generation of Cypriots, to make the smart choices that would steer our common country to stability and long term prosperity. Choices that could help propel Cyprus to the First World in 10 short years. If we don’t, we will keep Cyprus hostage to our own poor choices.

Thank you for your attention.

 

 

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2 Σχόλια leave one →
  1. stelios papalangi permalink
    Δεκέμβριος 5, 2015 07:55

    κλασικός νεοφιλελευθερος τζιχαντιστής, που εθκιέβασεν μόνο ένα βιβλίο τζαι έσσει μιαν μόνο αντίληψη του κόσμου, εξου τζαι συγκρίνει πράματα άσχετα μεταξύ τους.

    αλλά ακόμα τζαι πράματα που μπορεί να εξηγήσει η θεωρεία του δεν τα καταλάβει… Στέκουνται γραμμή λαλεί για να γίνουν δημόσιοι υπάλληλοι… τζαι λαλούν το με ένα υφάκι υποτιμητικό… άδε τους θέλουν να γίνουν δημόσιοι υπάλληλοι
    Ναι ρε στέκουνται… Γιατί με όλα της τα κακά (κομματοκρατία, ρουσφέτι, έλλειψη κινήτρου, έλλειψη οράματος κλπ) , ένας εργαζόμενος στο δημόσιο μπορεί ακόμα να είναι ΑΝΘΡΩΠΟΣ.
    γιατί έσσιει αξιοπρεπή μισθό και ανθρώπινο ωράριο, ούτως ώστε να μπορεί να έσσιει τζαι μια ζωή έξον που τζίηνη της δουλειάς.
    Ενω οι εντερπρουνερς τι του προσφέρουν ακριβώς ; μια φορά βάλτε τα κάτω τζαι πέτε μας τι του προσφέρουν ; «οππορτουνιτις» ;
    Πόσον δύσκολο ένι να σας το βάλουν με τη παττίχα σας την όφκερη ;

    ώρες ώρες τούτοι άνθρώποι πραγματικά ζουν στο μαγικό κόσμο του νεσκαφε.

    Τέλος πάντων
    Ναι προφανώς είναι καλή η ανάπτυξη, αλλά , χωρίς το ερώτημα για ποιόν , δεν μας απασχολεί ιδιαίτερα. Γιατί μπορεί να έχεις ανάπτυξη χωρίς δουλειές, ή ανάπτυξη πάνω στην ανυπαρξία μισθών, ή (όπως γίνεται συνήθως) ανάπτυξη μόνο για τους λιούς…. ή ακόμα πιο επικινδυνο (ακριβώς επειδή δεν ζιουμεν στη συγκαπούρη) ανάπτυξη μόνο για μια εθνοτική ελίτ… κάτι που είναι συνταγή για καταστροφή.

    είχαμε τους χριστόδουλους το 2004 που μάχουνταν να μας πείσουν να πούμεν όχι για τα ρυάλια, τζαι τωρά εφαηθήκαν να μας πείσουν να πούμεν ναι για τα ρυάλια…

    τέλος πάντων.. ναι είναι σημαντικό το κεφάλαιο να συνεργαστεί…. γιατί εν ακριβώς τούτοι, που αν δουν μόνο το προσωπικό τους συμφέρον μπορεί να προκαλέσουν τη βάση μιας νέας συγκρουσης.

    Μου αρέσει!

    • strovoliotis permalink*
      Δεκέμβριος 7, 2015 07:05

      Νομίζω είσαι άδικος. Αυτό που περιγράφει ο Βασίλης είναι ένα κράτος που λειτουργεί σωστά σε περιβάλλον ελεύθερης οικονομίας και αστικής δημοκρατίας (εντάξει, δέχομαι πως η Σιγκαπούρη είχε ελλείμματα σε αυτό το κομμάτι). Και ακόμη αν μπορείς να αποδείξεις πως η «νεοφιλελεύθερη» ιδεολογία δεν λειτουργεί πάντα, η πραγματικότητα λεει πως λειτουργεί τις περισσότερες φορές, άρα οικονομία με αναπτυξη θα φέρει και δουλειές και φυσικά πλούτο, για κ΄ποιους περισσότερο από άλλους.
      Τώρα, μπορείς να έχεις μονοδιάστατη φιλοδοξία να ενταχθείς στη δημοσία υπηρεσία, δικαίωμά σου. Όχι όμως υπό καθεστώς καθολικά άδικο σε βάρος των μη δημοσίων υπαλλήλων, σε βάρος των φορολογουμένων. Δεν πρόκειται να διαλυθεί το κράτος, αλλά δεν είναι και θεμιτό να λειτουργεί το κρατος σε βάρος της οικονομίας.
      Τέλος, καλώς ή κακώς τα οικονομικά είναι μέρος του προβλήματος, είναι επίσης μέρος των παραμέτρων που λαμβάνει υπόψιν ο κόσμος πριν να ψηφίσει, αυτή τη φορά είναι με τη σωστή πλευρά.

      Μου αρέσει!

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