The incompetent and corrupt state

THAT THE State is an incompetent and corrupt entrepreneur is self-evident. Despite all the theories to the contrary that have been developed and tested over the years, history is full of state-owned enterprises going down in bankruptcy, after wasting substantial national resources or after forcing taxpayers to foot the bill.

There is little doubt that the phenomenon is not confined to Cyprus. It has manifested itself in Greece, in Russia, in China, in Cuba and, without exception, in all the countries of the world that have attempted to centrally “plan” and “direct” their economy, by utilising the services of obedient and conforming civil servants, whose basic qualification was their allegiance and loyalty. Their reward for their blind obedience was the accumulation of “vested rights”, including their right to indulge in corrupt practices.

Look at the case of Cyprus Airways, the case of Cyta and, very recently, the case of the Co-operative movement. The ailments of the co-operative movement have roots that date back several decades. Soon after independence, Archbishop Makarios extensively used, through Andreas Azinas, the cooperative movement as a tool for the political manipulation of the electorate – a practice that was closely followed by his immediate successor at the Presidency but also by most of the presidents that followed them.

Thus, the Cooperative movement was led into bankruptcy by systematically extending loans that did not have to be repaid. At the end, the taxpayers were forced to step in to cover the defaulting loans in order to avert a “haircut” of the small coop depositors, similar to the one that bank depositors suffered in 2013.

What is truly shocking is the audacity of the employees of the Cooperative movement, who unquestionably carry a good part of the responsibility for the collapse of the cooperative saving societies. Throughout this long period of time, the employees of the saving societies became accomplices to the perpetration of the crimes committed or, at least, were silent observers of what was happening under their nose, thus facilitating the looting.

These very people, instead of apologising to the taxpayers for their failure to discharge properly their duty, they are now aggressively seeking to secure compensation (that is many times higher than what other “normal” employees would be entitled to receive) for not being allowed to carry on as before!

Regrettably, the prevailing impression is that the State and State Enterprises constitute an inexhaustible source of wealth from which one can easily derive income, without providing anything substantial in return. Clearly, we have not learnt from our past mistakes. Clearly, we do not really care if we lead Cyprus into a new economic crisis, similar to that experienced in 2013.

My question is. Has the time come to consider the possibility of confining the State to its regulatory and supervisory role? Should we abandon the idea of elevating the State to an entrepreneur, given its catastrophic past record? The State is a proven incompetent and corrupt entrepreneur, capable of throwing billions down the drain (in its efforts to keep its boys happy). I am very much afraid that we have not seen the end of this saga. For as long as the political spectrum (to the left as well as to the right) is occupied by politicians, who are exclusively interested in serving their own self-interest, the problem is likely to persist.

Potential new treatment for thalassemia

A group of scientists of the Molecular Genetics Thalassaemia Department of the Institute of Neurology and Genetics (CING) is developing a new method for the treatment of Mediterranean anaemia (beta thalassemia) using molecular genetic tools, according to a statement released on Friday.

According to the statement, the institute’s gene therapy and gene modification research unit has approached the most frequent and serious form of the disease in Cyprus with a new method, the effectiveness of which has been demonstrated experimentally on patient cells.

The team has proven in laboratory that this method has achieved a significant improvement in the underlying disease parameters and has exceeded in effectiveness the gene therapy approach currently under clinical trial.

It has also shown that the combination of the two methods improves the effects of the treatment compared with the application of each method individually.

“These results pave the way for monotherapy or combination therapy, specialised in the most frequent form of beta thalassemia in Cyprus,” the statement said.

It added that the Molecular Genetics Thalassaemia Department has recently secured funding from the Cyprus Research Promotion Foundation to further improve the treatment method.

Patients with beta thalassemia, it said, depend on regular blood transfusions and pharmaceutical chelation, while bone marrow transplantation, the only radical treatment for the disease, is only available for a small percentage of patients and comes with serious complications.

Researchers are developing new radical therapies using molecular genetics tools.

“So far, clinical studies for this treatment are based on the addition of a normal beta globin gene to the patient’s stem cells. Due to technical constraints, this approach does not fully cure patients with severe forms of the disease, such as the one caused by the most common for the Cypriot population mutation of beta thalassemia,” the statement said

The CING team is trying to develop optimised and more personalised treatment approaches, especially for this mutation.

“One of the approaches developed in the laboratory is based on recognition and suppression of the transcription product (RNA) produced by the defective beta globin gene. Targeting defective RNA prevents its pathological action thereby allowing for increased production of normal beta globin,” it said.

According to data from the Cyprus-based Thalassaemia International Federation (TIF), around 600 people in Cyprus suffer from thalassaemia and 16 per cent of Cypriots are carriers.

Co-op freezes defaulters’ accounts

The Co-op bank on Friday froze the savings accounts of a number of its customers with non-performing loans in a bid to force them to come to an agreement with the lender regarding their dues.

The bank said it had frozen term deposit accounts of people who owed money but were not servicing their loans. The freeze depended on the amount the people owed.

If they had more cash in their account than the amount owed then the balance will be withdrawn. If it was less, the whole amount was frozen.

Savings accounts were frozen from €2,500 upwards. Current accounts were not touched.

The move comes a few days after Hellenic bank agreed to acquire parts of the Co-op bank. Non-performing loans are not part of the deal while Hellenic will take over deposits. Freezing them will prevent them from moving to Hellenic before sorting out the debt.

Yiorkadjis calls for end to noise pollution in the capital

Nicosia Mayor Constantinos Yiorkadjis is calling for the immediate reinforcement of bodies tasked with tackling noise pollution coming from bars and other establishments until the problem is regulated.

In an open letter, Yiorkadjis said that the problem of noise pollution from recreation centres, and other forms of behaviour negatively affects everyone and the inability to tackle it does not only affect the health, comfort and quality of life of affected residents. It also “creates a series of other substantive complications that need to be taken into account when legislation is being drafted and enacted or when prevention and coping policies are formulated.”

The inability of effectively dealing with noise pollution, the mayor said, could even lead to the abandonment of entire areas by residents, leading to the alteration of the character of that area.

Dealing effectively with such problems, on the one hand it is a plus for the credibility and effectiveness of authorities is judged, and on the other hand, “the feeling of security is enhanced and the quality of life of many of our fellow citizens improves.”

He added that mayors of tourist areas have repeatedly pointed out the negative effects of noise pollution on the country’s tourism, while neighbouring Mediterranean tourist destinations such as Spain, have already begun to take stringent measures.

“The notorious law of 2007, rather than positively completing the existing institutional framework and providing solutions to a problem that is increasingly intensified, it seems to have aggravated the situation due to inability for its implementation. How and why we have arrived here should be an example to avoid,” he said.

In addition, Yiorkadjis said, the long delay in hearing cases of public nuisance from noise pollution or even building irregularities, creates serious problems of unequal treatment against law-abiding business owners.

“Reasonably, a law-abiding owner who finds that someone else can break the law for three or four years with no consequences, may wonder why he should not do the same, since the financial gain would be ten times more than any fine that could be imposed on him years later,” Yiorkadjis said.

Unfortunately, he said, either because of the police being understaffed, or because of confusion over which authority is in charge of what, or because of obsolete and conflicting laws and long delays in issuing court decisions, “citizens are getting the impression that anarchy is prevalent and authorities are absent from their everyday life”.

The mayor said that he has repeatedly addressed both the police chief and the Nicosia police chief, asking them to investigate the possibility of increasing the intensity of policing and checks in the evening.

“I have recorded specific examples of such problematic behaviours and noise pollution, which have not been adequately addressed. I have also contacted the minister of justice and public order, the attorney general and the auditor-general, suggesting the establishment of a fast-track procedure for cases of neglect and urban irregularities, especially in cases of premises that operate without building permits,” he said.

“I understand that efforts are being made to modernise the relevant legislation and that there are great needs and workload in other services. I believe, however, that it is imperative to strengthen the departments which have the task of combating these irregularities, until the radical and final settlement of the problem.”

It has been proven, he said, that preventing, deterring and effectively tackling minor offences contributes to a state’s effort to create citizens with a culture of compliance with laws and respect for society as a whole.

British soldiers ‘horrifically tortured children’ during Cyprus Emergency

British soldiers allegedly tortured Greek Cypriots by stubbing cigarettes out on their rectums, simulating executions and using a metal contraption that caused eyes to bleed, High Court papers have revealed. The British Government is fighting a claim in the High Court from 34 elderly Greek Cypriots, who allege they were tortured by British soldiers and security services when they were youngsters during the Cyprus Emergency between 1955 to 1959. London to introduce contactless payment scheme for buskers The Government paid out nearly £20 million in costs and compensation to more than 5,000 victims of colonial rule in Kenya during the Mau Mau revolt in the 1950s and 1960s. The Cypriot claimants, all in their 80s, want the Government to follow the Kenyan example and settle out of court. One of the claimants was beaten so severely by British soldiers that he lost a kidney. British soldiers search a Greek orthodox priest during the Cyprus Emergency in 1955 (Picture: Central Press/Getty Images) The family of another claimant, Christos Constantinou, want compensation so that now, more than sixty years later, he can enjoy a better quality of life. In a statement, his children Paul Constantinou and Androulla Yianni said: ‘Our father was tortured by two British Army captains, who were court-marshalled and sacked for their behaviour. 92-year-old told to tear down beloved rose bushes for encroaching village green ‘He is no longer well enough to attend court himself, but remembers vividly the awful things that happened to him.’ Earlier this year the British Government failed in a bid to block the compensation claims on the basis the alleged crimes should have been tried in a Cypriot court. Kevin Conroy, solicitor for the claimants, said: ‘The claimants have been fighting for recognition of the torture and human rights abuses committed against them nearly 60 years ago. A British marine taking part in a terrorist manhunt in Cyprus in 1956 (Picture: Getty Images) ‘These are people who were juveniles at the time, but are now in their eighties. Many of them still suffer daily from the physical and psychological injuries inflicted on them at the time. ‘Three of the claimants have died in the process of bringing this case to the stage it is at now, while others are no longer fit to bring a claim themselves.’ ‘Dementia sufferer’, 95, ‘arrested in wheelchair’ after carer dies in hospital He added: ‘We will now press to bring this matter to a full trial to ensure that justice is done for our clients.’ Bambos Charalambous, Labour MP for Enfield Southgate, has written to the Ministry of Defence concerning his constituent Mr Constantinou’s case. The MP demanded the MoD take into account Mr Constantinou’s growing frailty, saying it is important to settle the case sooner rather than later. can today reveal what the Minister for Armed Services Mark Lancaster MP said in his response. The minister wrote: ‘The Government considers torture to be an abhorrent violation of human rights and human dignity and consistently and unreservedly condemns this practice.

We are failing to tackle organised crime

Everyone seems to agree that the police force’s attempts to clamp down on organised crime are not very effective. This becomes a subject of public debate when there are a few incidents close to each other. In the space of a few weeks there was the double murder in Strovolos, the shootout in Ypsonas in which a policeman was seriously injured and last weekend the shooting of a man outside his house in Trachoni village.

Such incidents remind our politicians and media that not enough is being done to fight crime and they feel obliged to utter platitudes about “zero tolerance” and announce new crackdowns which rarely amount to very much. An illustration of the so-called crackdown was given on Wednesday when some 18 people known to police from past cases were arrested in the Larnaca district and taken in for questioning. None appeared in court and they were released later in the day, prompting criticism that the arrests were for public show.

It was difficult not to conclude that the main purpose of the arrests was for the police to be seen to be doing something about organised crime. Were people arrested in order to be given a telling off or to be warned to stop engaging in crime? Perhaps the police wanted to show they knew who was involved in organised crime and linked to money laundering. Whether such methods have any impact is another matter. In a way, the suspects would have been reassured that there was no evidence against them to justify even a remand order.

The Mayor of Paphos Phedonas Phedonos regularly attacks the police, accusing them of corruption and senior officers of having links to organised crime. Phedonos publicly gives the names of suspected drug traffickers in Paphos and urges the police to make arrests; he even purports to know the parts of town where drugs are sold. He is invariably ignored, and uses this to support his claim that police are allegedly protecting criminals.

Meanwhile, Justice Minister Ionas Nicolaou has been repeating his call for legislation that would allow police to monitor the telephone communications of suspected criminals, insisting this would be the only way to get to the top people of organised crime, especially relating to drug trafficking. The parties have consistently refused to pass legislation giving the police this power, which would have to be authorised by a judge, on the grounds that it would be a violation of human rights. In Cyprus we have to respect the rights of suspected drug traffickers.

On Friday Akel chief Andros Kyprianou said his party would not approve such a bill. The police have been given enough legal tools to fight crime and do not need this one as well, he argued. This was another indication, like Wednesday’s show arrests and Phedonos’ public outbursts, of how committed everyone is to the fight against organised crime.

Lawyers’ price-fixing challenge success

The complaint by ‘Fairness in Fees’ to the European Commission challenging price-fixing by the Cyprus Bar Association (CBA) has been successful; their minimum fee regulations will soon be consigned to the bin.

THE MINIMUM fee regulations for lawyers in Cyprus, which are set by the Cyprus Bar Association (CBA), will soon be a thing of the past thanks to a successful challenge by ‘Fairness in Fees‘, a London-based organisation founded by Greek Cypriot George Lambis, which submitted a formal complaint to the European Commission in 2016. Fairness in Fees claimed that the rules mandating the minimum lawyers can charge for out-of-court cases were in clear breach of the price-fixing and cartel provisions of Article 101 of the European Treaty and therefore of European law. The European Commission has upheld their complaint, which has forced the Ministry of Justice to submit a bill to parliament abolishing the power of the CBA to set minimum fees for out of court work. The soon-to-be-abolished minimum fee regulations set out formulas for calculating lawyers’ fees irrespective of the time spent on the matter or the complexity of the case. Under the regulations, a straightforward out-of-court execution of a will in which property of €1 million is to be distributed among the beneficiaries would incur €56,000 in legal fees. Similar work in the UK, for example, would likely incur no more than €5,000 in fees. The bill should be discussed at the next plenary session of parliament; it will replace the minimum fee regulations with the power to regulate the manner and procedure for resolving any disputes arising with regard to lawyers’ fees for out-of-court work. The changes must be implemented as the Commission will start infringement proceeding against the Republic of Cyprus, which could result in the EU Court of Justice imposing substantial fines on the Cypriot state if it fails to act. It’s also worth noting that there is no upper limit on the amount lawyers charge for out-of-court work. This enables disreputable lawyers to plunder estates when executing wills. In one case brought to my attention beneficiaries who were left three apartments in their aunt’s will had to give one of the apartments to a lawyer who was appointed to act as the executor of her estate. Anyone wishing to appoint a lawyer as the executor of their estate MUST AGREE THEIR LAWYER’S FEES beforehand and have these written into their will to avoid the risk of their estate being plundered

16 beaches in Paphos to be given Blue Flag

Water quality at Paphos beaches is excellent, according to the Cyprus Tourism Organisation (CTO) and Cymepa, with the area this week set to receive 16 Blue Flags.

President of the Winter Swimmers Matthaios Ierokypiotis said this year all 16 of the town’s beaches will be given the flags on Thursday.

The beaches to be awarded the flag – which represents bathing quality water – include the Bania in the centre of town, Vrysouthkia, Pachyammos and Faros. Beaches in Yeroskipou, Polis and Peyia are also included.

“We are completely satisfied and feel proud that his year the Bania beach has secured the Bloue Flag,” Ierokypiotis said on Saturday. “This clearly highlights the quality of the water here,” he added.
It also means, Ierokypiotis said, that it is the responsibility of all bathers to make sure the water stays pristine throughout the year.

DBRS upgrades Cyprus’ long-term foreign and local currency

DBRS Ratings Limited has upgraded Cyprus’ long-term foreign and local currency – issuer ratings from BB (low) to BB and maintained the positive trend.

DBRS also confirmed the short-term foreign and local currency – issuer ratings at R-4 and changed the trend to positive from stable.

According to the agency, the upgrade is driven by the decline in Cypriot banks’ non-performing loans (NPLs) and Cyprus’ better-than-expected fiscal performance. The banking system’s stock of NPLs fell by 14 per cent in 2017.

From their peak in February 2015 to December 2017, total NPLs fell by 28 per cent. Also in 2017, the fiscal surplus came in at 1.8 per cent of GDP, above an already upwardly-revised target of 1.0 per cent. A higher fiscal surplus, together with strong growth and early debt repayments, contributed to a significant fall in Cyprus’s government debt-to-GDP ratio from 106.6 per cent in 2016 to 97.5 per cent in 2017.

Improvements in DBRS’s building blocks of “Monetary Policy and Financial Stability”, “Fiscal Management and Policy”, and “Debt and Liquidity” were the key factors for the rating upgrade.

The Positive trend reflects DBRS’s view that “Cyprus’ solid economic and fiscal performances are likely to be sustained, contributing to the downward trajectory of the government debt ratio after an increase in 2018. After a stronger-than-expected 3.9 per cent in 2017, real GDP growth is forecast at 3.8 per cent in 2018 and 3.6 per cent in 2019. Moreover, the forecast for the fiscal surplus over the next two years is 1.7 per cent, with the primary surplus above 4 per cent, among the highest in the EU.

NPLs remain very high and a major vulnerability for Cypriot banks, but DBRS expects NPLs to continue to fall, driven by measures already in place, a policy strategy recently presented, and improving economic conditions”.

Very high NPLs, which increased significantly during the severe crisis in 2012-2014, remain the main risk to financial stability and a major rating challenge for Cyprus. High indebtedness in the private sector remains an additional risk, but the deleveraging process continues.

“Important efforts to speed the resolution of legacy NPLs are ongoing” it is noted.

It adds that the three core domestic banks have set up independent debt servicing companies with foreign debt specialists.

“An upgrade in the ratings would come from Cyprus’ demonstration to sustain healthy economic growth and a sound fiscal position, which would support the downward trajectory in the public debt ratio. Important progress on privatisations could also put upward pressure on the ratings. Moreover, Cyprus’ ability to significantly reduce vulnerabilities in the private sector, including a material reduction of non-performing loans, would be positive for the ratings. However, a period of significantly weak growth, combined with large fiscal imbalances, could lead to a change in the trend back to Stable. A reversal of the downward trajectory in NPLs could also be negative” it said.

Furthermore, it says that a sound fiscal position is expected to be maintained, supporting the ratings.

“Cyprus accomplished the consolidation of its budget position in a relatively short time. Despite the fiscal impact from the policy strategy for the reduction of NPLs, the budget position is expected to remain in a healthy surplus above 1.5 per cent over the next four years, supported by strong revenues and contained expenditure. The government is also aiming to maintain a small structural surplus, above its medium-term objective of a structural balance. Adopted reforms to strengthen fiscal management, including the reform to the wage indexation system, together with expenditure ceilings embedded in the Fiscal Responsibility and Budget Law, are expected to reinforce the sustainability of public finances”, the agency said.

Cyprus wants to be part of space development, minister says

Cyprus wants to be part of the space development and benefit from the space systems that are essential for the wellbeing and security of the European citizens, Minister of Transport, Vassiliki Anastasiadou said on Saturday.

She was addressing the local European Space Agency`s space start-ups competition `Act In Space` that is taking place in Cyprus for the first time.

The organiser of the competition is the Cyprus Space Exploration Organisation (CSEO). The competition takes place in 20 countries.

“Cyprus wants to be part of the space development and benefit from the space systems that are today essential for the wellbeing and security of the European citizens. The Republic of Cyprus is thus actively supporting the efforts concerning the use of space related technologies and applications,” the minister said, adding that during the last years, the government has developed the necessary structures and procedures in order to actively participate in the European Space Policy.

She also said that the ministry has decided to apply for membership in the UN Committee on Peaceful Uses of Outer Space known as COPUOS.

In addition, she said that the ministry is preparing the National Space Strategy and is considering the possibility of increasing Cyprus’ subscription to the ESA to give the opportunity to a larger number of researchers to be funded by the Agency’s plan for European Corporate State (PECS).

“Small states can, through targeted strategy, excel in this area as well and this is the purpose of Cyprus to excel in the space sector and bring growth to the island”.

In his speech, CSEO chairman Giorgos Danos said that when they first started the organisation five years ago they had a vision, which was to launch Cyprus into the space era because of their faith in the country’s potential.

“When we first started in 2013 five years ago we set a bold goal to launch Cyprus into the space era,” he said and recalled CSEO’s recent successes with first prizes at NASA competitions saying “that is why we invest in our youth.”

Danos added that with this competition “we will promote technological innovation in Cyprus and form innovative start-ups in the top high-tech space sector, giving opportunities to the new generation and placing Cyprus dynamically in this captivating field”.

More information about the competition:

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