Rebuilding the Cyprus Economy – Heritage as an Engine for Tourism

It’s April 2013, and we are being reminded again that sun, sea and sand will always be a major natural resource for Cyprus, at a time when oil and gas is the catchword for hoped wealth in an era of crushing national debt.

But after a brief, and iced coffee-assisted investigation by the Cyprus Daily Blog in Limassol this week, we found ample evidence that National Heritage resources are being neglected, when they are freely available to the Government as a means of selling hotel rooms, airline seats and guided tours to the incoming tourist masses.

So what do we mean by National Heritage? Well we are talking about ancient archaeological sites, museums, nature trails, religious sites and historical monuments. These locations provide culture specific interests that will attract a significant section of the regional and global travel markets if properly promoted, and if necessary, romanticized using media and advertising.

Wandering around various sites in Limassol, frappe in hand, we noted that Amathus archaeological site was more or less empty, save for a couple of roaming visitors and ourselves. The Amathus ancient coastal town, for those who are unaware, is a very impressive set of ruins with extensive documented and archaeologically-derived history. However, there are a set of major problems with the site which prevent it from making money for the state.

1.    A set of ten licenses could be easily sold (say at 5000 Euros per year, each) to allow independent souvenir and retail sellers to rent clean, regulated and static pitches at the entrance way to the major archaeological site. This would promote small business in Limassol, and allow the monetisation of the archaeological site to provide 50,000 Euros in base annual revenue to the Government. If this practice was permitted at all major city-located archaeological sites on the tourist trail, then this could generate 2 or 3 million Euros of extra revenue for the Government per year, excluding the benefits of increased low-cost self-employment opportunities and tax paid from VAT.

2.    The archaeological site itself should be made readily available for hire, so that concerts, outdoor conventions or public festivals can be held in the area in and around the scenic ancient town centre. This should be priced cheaply at 5000 Euros per day, allowing any major organisation to put such an event within its budget, and further increasing monetization of the site.

3.    The Government itself should organise festivals inside the archaeological site to celebrate heritage, as Amathus is prominent and well known. A festival could include a barbecue, live music, conventions and exhibitions. This would allow the Government to sell catering and performance contracts for such events to allow organisations and companies to promote themselves to the public.

Conclusion

We suggest that Amathus ancient city is a good venue for promoting events that will give tourists and local consumers a reason to spend money in Limassol area through. We also argue that the site can be easily monetized through the selling of monthly pitch licenses to allow souvenir and refreshments retail.  Although not a template for all national heritage sites, it is considered by us to be a good example. 

Size Matters - Cyprus Satellite TV Dishes

Yes folks, finally a lighthearted article from the blog that brought you doom and gloom long before the Troika   landed at Larnaka airport....

Does size matter? Apparently, not. My Granddad's ex-"Soviet Navy" satellite dish is photographed above. It stands a whopping 3 meters in diameter, and combined with state of the art digital equipment and a clear signal, is capable of providing a full range of SIX CHANNELS (when it feels like it). On the bright side though, we do get regular decoded military signals from the Russians, plus a regular supply of game for dinner as birds continually fly into it at speed.

And yes, I realize it is rusty, over sized and obsolete. But at the time it was acquired, it was a powerful status symbol by which to strike the fear of God into our neighbors and their simple analogue TV antennae. And in Cyprus, status is all that matters....isn't it?

Cats of Cyprus

Cat of the Week - Spotted this little sweetheart in Amathus beach area on Wednesday. Definitely a stray, it was  with a group of other cats near the archaeological area close to the sea, where they were getting scraps from the local tourists. Seemed content enough, but very shy and unwilling to get close to people. 

Rebuilding the Cyprus Economy – The Importance of the Shipping Industry

In the simplest possible terms, the shipping industry in Cyprus must be nurtured due to its vital importance as an in-flow of money to the island’s stricken economy. By this, we refer to the fees imposed upon shipping companies who wish to sail under the Cyprus flag, and who wish to dock at the main harbours.

According to Euronews (27/3/13) the shipping industry contributed a whopping 800 million Euros, or 5% of the GDP, to the islands economy last year, and is in the top-5 largest hosts of ship management companies. The industry was reported to have been impacted by the closure of the banks in Cyprus during heated negotiations between the Government and the EU Troika group earlier this month, as companies lacked the ability to pay for orders, and accept normal payments.

Aside from the fact that Cyprus is an island and relies heavily on ship borne imports coming from Europe, she also acts as a hub for shipping management companies operating diverse and dynamic trade routes between Asia, North Africa and the Americas. Her close proximity to the Suez Canal is also of great strategic importance to the Cypriot merchant shipping fleet, allowing vessels to take a short-cut from the Mediterranean into the Red Sea.

However, the embargo by Turkey on Cypriot-flagged ships using her sea ports has also been a major restriction for management companies using Cyprus as a base of operations – Turkish ports are a useful point of transit, allowing passengers and cargo moving through Cyprus to easily access the vast Russian market (via the Black Sea or Armenia), or indeed, the very large Turkish domestic market. This economic element of a long-standing Cold War between Cyprus and Turkey has effectively strangled the Cypriot shipping industry in much the same way imposed upon the Turkish Cypriot breakaway regime in northern Cyprus.

So what should be done to nurture the Cypriot shipping industry, given that it is so important to the economy?

In the short-term, Cyprus must consider the impact of taxes and levies on the shipping industry as an offset against the impact they suffered through the “Haircut” or one-off tax on all bank deposits imposed by the Troika in return for a national bailout. In essence, the shipping companies should get a tax-holiday of one or two successive years on all corporate transactions as a relief and economic stimulus package aimed broadly at an important industry. This however, should not be a free offering, but rather part of an opt-in scheme whereby those companies that want tax relief are required to hire additional full time staff according to their size and operating income.

In the long-term, we must look to a peace settlement with Turkey, resulting in a strategic peace dividend in the region for all Cypriots to enjoy at all levels of society. In terms of the shipping industry, Cyprus flagged ships would be able to gain access to Turkish ports, and by extension, cheaper access to the Turkish and Russian markets for lower fuel and operating cost. This would boost strategic income from Cyprus flagged shipping, and also greatly increase the number of shipping companies choosing to use the Cyprus flag under license. This in turn would increase the number of full time jobs, and volume of corporate business opportunities available in Cyprus as a positive knock-on effect. 

Cyprus Bailout Fiasco - 19 March 2013

I don't feel envious for the new Presidency of Cyprus. Anastasiades has been on the job less than three weeks, and Europe has created a lose-lose situation for the Government in an effort to clean up the disastrous mess left by Christofias. 

Not only has Cyprus to contend with the continuing occupation of 38% of her territory by the Turkish Army (Including vast tracts of land formerly used for agriculture, tourism and light industry), but she must now accept the unfair demands of the Eurozone leaders as they treat the Cypriot people as "a Special Case", to be easily bullied unlike Spain, Greece and Italy. 

How can a bank raid be acceptable in any European country? How can Europe even ask for such a thing, knowing that it will spark fear of a precedent across Europe? 

Perhaps Germany forgot what it was like for half its territory to be under Soviet military occupation? Perhaps the Germans forgot what it was like to have Berlin divided by a military wall? 

The bottom line is this - Cyprus is hopelessly handicapped by the ongoing military occupation and no one in Europe gives a damn. We are a defeated nation, but we will prevail. We must prevail. 

For too long, we have allowed Cyprus to rot from within by the disaster of widespread corruption and from incompetent management. Nobody is innocent. We can blame the Russians, the Germans, the Greeks and the Turks exclusively, but the equation of failure always comes to the same result - the failure of the Cypriot people to fight for change. 

Whatever comes of the following days must be accepted with resolve and courage - take the bailout and then move on. Hard work, innovation and a refusal to give up will save us all, if nothing else.