Cyprus President Demetrious Christofias is being urged by local business groups to change his stance and allow development of casino gaming in specific locations. At the same time, the government is hoping to take advantage of recent EU court rulings that would support its efforts to ban online gaming.

The Cyprus Mail reports that Hermes Airports Chairman Nicos Shacolas fully expects the government to allow construction of a luxury hotel and leisure complex, with a casino, next to the new Larnaca airport. MIG Group Chairman Andreas Vgenopoulos wants to get more out of his investment in the Nicosia Hilton by obtaining a casino license, and the Limassol Chamber of Commerce is supporting a public venture that is bidding for a license.

The state itself has a deal with Qatar to develop a luxury complex in central Nicosia, which could also include a casino. Those asking Christofias to change his mind on casinos include the Cyprus Investment Promotion Agency, the Cyprus Chamber of Commerce and Industry, the Employers and Industrialists Federation, and hotel operator organizations PAYXE and STEK. The groups all believe casinos would attract quality tourism to the island.

Meanwhile, Christofias and governing party AKEL are pushing for a ban of online gaming as a means to combat what they see as a growing social problem. Online gambling falls under the Betting Law, which was amended in 2007 to comply with E.U. legislation for the free provision of services. But now, the effort is under way to re amend the law to exclude electronic gambling from this list of EU agreed services.

Discussion of a bill currently in parliament is now on hold, pending mandatory consultations with interested parties and the preparation of an impact study of such a bill. “What we have determined is that the necessary consultation with all those involved was not carried out,” DIKO deputy Nicolas Papadopoulos said.

A third form of proposed gaming could receive an unexpected boost from the economic crisis in Greece. As part of its budget crisis fix, Greece is looking at licensing electronic gaming machines linked to a central, government monitored system.

By GGBM

Chaos reigned again yesterday at Ercan Airport as a bailout deal for the TRNC Cyprus Turkish Airlines (CTA) collapsed amid pressure from unions. A deal had seemed all but sealed yesterday, with private Turkish airline Atlas Jet agreeing to buy a 51 per cent share in the stricken airline. CTA has been losing 3.5 million dollars monthly and has amassed around 120 million US dollars worth of debt in total. However, a spokesman for Atlas Jet said yesterday the company was pulling out of the deal because of the rabid opposition shown by the unions.

It is perfectly clear that if the workers and the management cannot work together, there is no way that the struggle needed to save this company can be staged, the spokesman said. Since Monday night all four CTA planes have been grounded after the Turkish aviation authorities revoked the airline’s licences. All workers at offices in Cyprus and abroad have also been on strike. Meanwhile, passengers continue to appear at Ercan hoping CTA’s supposed new partner Atlas would take them to their destination. Those who have booked tickets with CTA say they are receiving absolutely nothing in terms of information of what to expect. British holiday maker Kurt Leeming told the Cyprus Mail he had a holiday booked with the stricken airline in August, but was unsure of whether it would fly.

I’ve rang KTHY offices in London on Wednesday and they could not give any answers other than they expected to be taken over by Atlas in the next few days and that all flights would from then be secured. Also they were not offering or taking any cancellation of bookings.

Travel agents in north Cyprus were saying the same. There is no one at CTA except a security guard, one agent told the Mail yesterday. We can’t take bookings, we can’t take cancellations, we can’t give refunds, we can’t do anything for CTA customers. The agent said most CTA passengers had postponed their return flights in the hope that the problem would be sorted out in a few days. Others had simply paid for flights with other private airlines Atlas Jet and Pegasus, or flown with Turkish Airlines, which also operates out of Ercan. Prior to Atlas Jet’s pulling out of the deal, a 2000 strong group of trades unionists supporting workers at CTA and opposed to the Atlas deal, marched through north Nicosia, stopping at the Turkish Cypriot parliament, finance ministry and headquarters of the ruling National Unity Party (UBP) in Nicosia.

Small scuffles broke out with the police when some protesters began pelting the finance ministry with plastic water bottles. Later, eggs were thrown at the UBP headquarters. The protesters also handed a letter addressed to Turkish Prime Minister Tayyip Ergdogan at the Turkish embassy, complaining that the deal between CTA and Atlas had been engineered by the Turkish government and imposed on the Turkish Cypriot people. It is now plainly clear that all political and economic policies in north Cyprus are directed by your government, the letter said, adding that the view of the Turkish transport minister Binali Yildirim’s view that Turkish Cypriot were incapable of running an airline was unacceptable.

By CM

President Christofias has warned that failure to achieve fiscal consolidation will have knock-on effects on our economy. In his welcome address at the opening of the 35th Cyprus International Fair 2010, which was read by Minister for Commerce, Industry and Tourism Antonis Paschalidis, President Christofias congratulated the participants in this years Fair which coincides with the celebrations of the 50th anniversary of the Republic of Cyprus.

As he said, the annual institution of the International Fair records with the most vivid way the steps of progress, growth and prosperity of the people of Cyprus, noting that the 35th Cyprus International Fair, with its multifaceted role, is the most important commercial event of the year for Cyprus.

Welcoming the foreign officials and other guests, as well as the representatives of all the participating countries in the Fair, Christofias said that their presence here is a sign of confidence in the economy of the country, as well as an expression of their friendly sentiments towards the people of Cyprus. He stressed that much of the success achieved by the Cypriot economy is due to the mixed economic system which for many decades now offers and secures a continued progress and growth and prosperity to Cyprus.

The support and strengthening of this mixed system, which has anthropocentric orientation and clear growth direction, constitutes the cornerstone of all our efforts, he added. He stressed that the priority of this government is to create conditions of macroeconomic stability, which can be achieved through close cooperation among public, private and cooperative sector.

He said the Government attaches great importance to the maximum utilization of the comparative advantages of Cyprus, such as its strategic geographical location and its status as a member of the European Union and the Eurozone. President Christofias noted that Cyprus was not directly affected by the financial crisis due to the negligible exposure of the financial sector to toxic products.

However, he added, inevitably, the real economy was indirectly affected because of its small size and its open nature. He noted that 2009 has been a year of great challenges for the Cypriot economy, adding that 2010 is expected to be equally difficult as well.

He said that the Government had reacted promptly and decisively and took early measures amounting to 500 million euro, which alleviate as much as possible the effects of the global financial crisis. We consciously adopted an expansionary fiscal policy with the increase of investment and social expenses to be the main axes aiming at stimulating investment and demand, as well as the social cohesion, he added.

He emphasized that despite the economic crisis, the government continues and expands its social policy to relieve a large part of the population which has special needs, such as low paid pensioners, recipients of public assistance, disabled and blind people and multi-child families. President noted that the unprecedented global financial crisis has inevitably affected the small, open economy of Cyprus, adding that the main problems we need to address are the reduction of the economic growth, the increase of the budget deficit and the relatively low competitiveness of our economy.

The effects of the economic downturn brought to the surface the structural problems of the Cypriot economy, which concern, inter alia, the operation and effectiveness of the state machine and tourism, he said. He also said that some of the measures we intend to implement include the limitation of spending in the wider state sector, restrictions on public spending and increasing state revenue by combating tax evasion. In conclusion, he warned that failure to achieve fiscal consolidation will have knock-on effects on our economy.

By FG

Qatar has signed a deal with Cyprus to develop a hotel, office and residential complex in the capital Nicosia, targeting rising numbers of visitors to the east Mediterranean island. Qatari Diar Real Estate Investment Company and the Cypriot government agreed to set up a joint venture for the development of a leisure complex, with the initial investment exceeding 150 million dollars, officials said.

Mohmmed bin Ali Al Hedfa, Group Chief Executive Officer of Qatari Diar, owned by the Gulf state, said the first phase will be a five star hotel, while the second phase will be apartments and offices. The contribution in capital of each side in the venture was still under negotiation, Al Hedfa said. Each side will hold 50 percent. The area allocated for the complex is close to the commercial hub of the capital and is expected to cover 50,000 square metres of construction, Cypriot officials said. The joint venture agreement was one of several signed on Wednesday between the Cypriot government and Qatar, whose ruler Emir Sheikh Hamad bin Khalifa al-Thani headed a large delegation on a visit to the island. Qatar reported growth of more than 11 percent last year despite the global financial crisis, and has been pouring billions of dollars into infrastructure, real estate and education projects.

By CW

Cyprus’ Central Bank governor said on Monday that the east Mediterranean island could see it’s economy shrink in 2010 for the second consecutive year. Athanasios Orphanides told legislators that the economy remains in recession and that a contraction cannot be ruled out for this year.

Orphanides’ remarks contrast a finance ministry projection that the island’s economy to grow by 0.5 percent this year after a contraction of 1.7 percent in 2009. The Central Bank chief said he’s "particularly concerned" over higher inflationary pressures relative to other euro zone countries that are "undermining the economy’s competitiveness."

European Union-member Cyprus joined the euro zone on Jan. 1, 2008. Orphanides also warned of a "dangerous" rise in public expenditure to 47.6 percent of gross domestic product in 2010 and urged immediate restraint. "The primary aim is to urgently calibrate fiscal policy in order to bring public finances back to a sustainable level without undermining the country’s growth-oriented course," he said.

Cyprus Finance Minister Charilaos Stavrakis last week unveiled a string of measures aimed at shrinking a bloated public sector, cracking down on tax dodging and curbing social transfers in order to halve the island’s 6 percent fiscal deficit by 2013. Stavrakis said the stability program, sent to Brussels for EU approval earlier this month, will slash 4000 government jobs over the next three years. State operating expenses will be rolled back by euro150 million by next year.

By Boston