Press Conference of the General Secretary of the C.C. of AKEL Andros Kyprianou on the Cooperative Movement
AKEL C.C. Press Office, 10th February 2017, Nicosia
The economic crisis and the Memorandum’s implementation have created α new situation for the Cooperative Movement.
The decisions taken for the recapitalization of the Central Cooperative Bank have caused sweeping changes to its structure and changed its character. Today, unfortunately, there are no cooperative credit agencies, given that the cooperative credit institutions have been reduced to one state bank, the Central Cooperative Bank (CCB). The State owns 99% of its shares and determines the decisions that are taken by the CCB…
It is clear that the main responsibility for the CCB’s development rests with the Government as it is the main shareholder. That’s why its primary duty must be to preserve the social ownership structure, either by maintaining a public ownership status or by returning the property to a cooperative basis.
Any attempt to sell-off, either the credit or commercial cooperative sector is directed first and foremost against society.
At the same time, we cannot but note that the improvement in the CCB’s functioning and procedures is essential. However, we do not accept that it should be considered as an excuse for its selling off to big private interests. We have seen what the results of these Government policies have brought, wherever these have been implemented, such as, for example, in the ports.
The CCB is called upon in the period ahead to back economic growth and society’s prosperity. To do so, it must stick to four fundamental principles:
First, to protect the local character of the bank. The CCB is the only bank in Cyprus that isn’t controlled by foreign investors and its functioning is connected with local communities. The sum total of original members – depositors exceeds 400,000, which illustrates the bank’s importance in Cypriot society’s daily life.
Second, the cooperative principles in decision making and in the bank’s operation should gradually be restored. State support of the CCB has weakened the role played by the Cooperative members in the administration and operation of the Bank. Today we need to redefine the role of the members of the Cooperatives and put them at the very centre of the decisions.
Third, it should protect the borrowers and depositors. The management of loans by the CCB must not lead to the exploitation of the borrowers. It is necessary that the primary home and the small business enterprise is supported. Handing the management of a loan to foreign/domestic investment funds must be avoided.
Fourth, job positions must be maintained. Today, the Bank employs 2,700 working people. The CCB’s development in the future must be tied to the protection of labour rights and preservation of jobs.
AKEL was always a staunch supporter of the cooperative movement and will continue to uphold the cooperative idea and values.
I reiterate that as long as the economic conditions remain difficult in Cyprus the protection of the social ownership structure is a duty of the State. Since the Government has unilaterally decided to withdraw from the CCB, as the Finance Minister has repeatedly stated, it must proceed to take concrete steps:
- To return the shares to the lawful owners of the Cooperative members.
- To give the possibility for the priority acquisition of new shares to existing members.
- To issue shares to employees in the CCB and to other organized groups of a local character (e.g. provident funds, local authorities, cooperative agencies in the commercial sector etc.) in order to preserve the Bank’s local character.
- To ensure that any person (natural or legal and those related to the person) will not hold more than 5% of the shares in order to ensure the broad base of CCB and prevent effective control by one or two persons .
- To bring back the direct election of the Board elected by Cooperative members, based on the principle every shareholder with one vote, which represents a core cooperative idea.
We recall that the Government has already made pledges to the Parliament on some of these issues, when the relevant Bill through which the State was taking 99% of the shares was being voted on.
AKEL is ready to cooperate both with the Government and other political forces to ensure that Cooperatives will once again constitute a pillar of growth for the Cyprus economy.
