The Finance Ministry unprepared to propose comprehensive solutions

Statement by Aristos Damianou, AKEL MP, after the meeting of the Parliamentary Finance and Budget Committee

27 March 2023

On today’s occasion too, at the meeting of the Finance Committee with the new Minister of Finance, we conveyed our best wishes to Mr. Keraynos and our readiness to work together, as long as the policies promoted by the Ministry of Finance serve the many and not the few, which was the norm, unfortunately, under the previous administration.  At the same time, we have raised a number of stakes that are pending to Cypriot society and economy, recognising of course that the new Minister is in his first month in office.  However, the economy is ongoing, the needs are there, the stakes are there and they demand solutions.

I regretfully have to say that, despite the fact that some problems have been recognised and some headings have been given to the big and burning issues of our era and of the day, unfortunately the Ministry of Finance is unprepared to propose comprehensive solutions.

In particular, on the issue of the issue of expensiveness/price hikes, the danger of the foreclosures of primary homes and small business premises, where the new government seems to be following the path of the previous government. On the issue of the reduced VAT rate of 5%, it also seems to continue where the previous government left off, refusing to discuss broadening the criteria to meet the needs of society in imposing a reduced rate of 5% instead of a 19% VAT. For sure, a comprehensive reference to affordable housing, which is a huge social necessity, is absent.

Of course, it is on record that the new Minister has made representations to the Central Bank and commercial banks in relation to interest rates. We doubt whether these representations will be enough to change a reality that is very negative for people and the economy.

If I were to put two more headlines regarding today’s meeting, it would be negligent if I did not note the practice of issuing inconsistent and contradictorily statements, or rather engaging in empty talk and promises, between the ruling parties and the Treasury. In particular, on issues that are pending before both the Finance Committee and the House of Representatives, such as the issues regarding VAT, foreclosures, and interest rates.

But more importantly, we believe that, unfortunately, today we have not heard anything new from the new Minister of Finance that creates hope and perspective. We want to believe that with further study and immersion on the key issues, the much-needed solutions for Cypriot society and the citizens of Cyprus will emerge.