Troika discusses Cyprus problems in construction and tourism sector

The problems faced by the construction and tourism sector and the issue of non-performing loans (NPLs) were discussed during a series of meetings held on Wednesday between the Troika delegation and the Cypriot competent bodies, in the framework of the Troika`s fourth assessment of the Cyprus economic adjustment program.

In statements followed a meeting between Troika and tourism bodies, Chairman of the Cyprus Hotel Association (PASYXE) Charis Loizides said that the Troika delegation was briefed on the course of tourism so far in Cyprus and the problems faced by the hotel industry, such as

Loizides said, inter alia, that Cyprus and its Russian tourism market has been greatly affected by the Ukraine- Russia crisis as well as the depreciation of Russian currency.

We initially expected a 25% increase from the Russian market, but right now we would be delighted if you achieve an increase of 5% -10 %”, he added. He also expressed the hope that the market would gradually recover in June.

He also said that that during the meeting the Association informed the Troika about the ongoing problems faced by the hotels with regard to the banks.
” Banks are moving too slowly on the restructuring of loans and too many hotels are in the list with the non-performing loans ,” as he noted.

He said that some efforts are being made, but the truth is that the banks are still not able to help us to meet our existing needs ”. In conclusion, he said that 70 % of hotel staff is Cypriots and 30 % Community workers.

On his part, CTO Director of Tourism Lefkos Phylactides said that CTO`s estimates regarding arrivals from the Russian market and how it is affected by the Ukrainian crisis coincide with those of hoteliers.

The situation remains fluid ,” he said, adding that ” however, the dynamic of reservations from the Russian market is maintained and scheduled flights have not changed downwards according to figures so far .”

He also said that the general assessment is that the market will go fairly well. “Of course we will not have an increase of 30% that we had in previous years, but we will have a positive outcome from the major tourism markets. ”

Troika delegation met also today with the Federation of Association of Building Contractors Cyprus (O.S.E.O.K)

In statements after the meeting, Chairman of the Federation Costas Rousias said that the Troika was briefed on the problems currently facing the construction industry resulted in a 41% decrease in industry`s turnover compared with last year.

Russias said that a number of statistics which indicate the contraction of industrial activity has been presented during the meeting.

He also expressed the need to provide incentives for growth in the construction industry as well as to absorb EU funds.

The issue of non -performing loans was the focus of a meeting between Troika delegation and the Bank Employees` Union ETYK which has called on the Cyprus Employers and Industrialists Federation (OEB) to push its members to pay their loans , which, according to it , are the majority of non-performing loans.

Troika technocrats will conclude their contacts by May 12. Cyprus is currently implementing a 3-year fiscal adjustment program, following a bail-in deal, reached last year with its international lenders, known as the Troika (European Commission, ECB, IMF).

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