Association head sees Cypriots as the first to go
THE PREDICTED downturn in the construction sector could see around 20,000 jobs lost, the head of the Cyprus Building Contractors’ Association warned yesterday.
Speaking at a news conference, Sotos Lois said according to the association’s estimates, construction work in the private sector, worth €850 million in 2007, will drop by 30 to 40 per cent as a result of the economic downturn.
Lois highlighted that if the estimates are proved correct, this will translate into 20 per cent job losses.
The industry now hires around 100,000 people, including 43,000 builders. The remainder are made up of cement masons, interior designers, architects, civil engineers and others.
The drop in demand for construction work by nearly half would see 20,000 jobs axed in the industry, warned Lois.
Asked whether bosses would sack foreign workers first, Lois said his association was sympathetic to union demands not to lay off locals but unscrupulous businessmen would choose Cypriots first, since foreigners were paid lower wages.
Foreign nationals account for around one fifth of the construction workforce, he added.
The Association President called on the government to make good on its pledge to take on large projects to counter the effects of the global downturn in Cyprus and to do it fast.
Earlier this month, the government earmarked €52 million to support tourism and construction, as GDP growth figures slowed to 3.5 per cent in the second quarter and the eurozone slid into recession.
Following a meeting between President Demetris Christofias and the Ministers of Finance, Interior, Commerce, Labour, and Transport, €40 million was allocated to support the construction sector while €12 million assigned to the Cyprus Tourism Organisation (CTO).
Christofias pledged full implementation of the state’s development budget, more new large projects, the strengthening of government housing projects, and extra money to municipalities to ensure the completion of planned projects.
He also promised to cut red tape and overcome “bureaucratic bottlenecks” to help projects get off the ground more quickly.
Lois noted that the €40m earmarked for public works was too small a figure to cover the gaps in the industry.
He added that lay offs had already started, though in small numbers, in the coastal tourist areas.
According to Charalambos Petrides, Vice President of the Property Valuers Association, property sales have dropped by 24 per cent island-wide this year. The greatest drop was seen in Paphos where the decrease, compared to the same period last year was as high as 36 per cent. The figures are based on sales contracts registered at the Land Registry between October 2007 and 2008.
Petrides notes that 2007 was an exceptionally good year for property sales and that a comparison with 2006 might be a better indication of the situation.
The average decrease in sales contracts across the island between 2006 and 2008 was a much lower five per cent.
Chairman of real estate agents, Solon Kourouklides, confirmed last week that property sales in coastal areas had dropped by up to 40 per cent as a result of flagging demand from foreign buyers.
“There is a big decrease in demand, especially from outside and especially from the British market, who are our traditional customers,” said Kourouklides, who noted that prices had remained generally stable.
“With one exception – coastal areas where there are organised projects specially targeting foreigners,” he said.
