THE RULING communist party, AKEL, was wrong to seek postponement of Cyprus’ entry to the eurozone, given the subsequent economic crisis, confessed President Demetris Christofias yesterday.
“Our position was for Cyprus not to adopt the euro until this year. On account of the economic crisis, I can say that it is better we joined last year,” he told reporters during his review of the government’s first year in power.
The president indicated that Cyprus would be less affected than other EU member states by the crisis, noting that the government had taken effective measures to tackle any possible consequences.
“I want to say to the Cypriot people, comparatively speaking, we’ve got it good. People are losing out, while we here have positive signs, with up to now 2.5 per cent growth,” he said.
Christofias highlighted the government’s two economic packages worth around €470m announced to soften the blow of the crisis, and the additional €300m to be drawn from the European Investment Bank for loans to small and medium-sized enterprises.
The packages are targeting the construction sector, he said, noting that already projects exceeding €640 million were being promoted across Cyprus.
Financial indices for 2008 were positive, despite external factors, allowing for the payment of social benefits to the tune of €816m, he noted. For 2009, the benefits budget will increase by 27.4 per cent to €1,040m.
As for development projects, the budget will rise to €1,090m in 2009, compared to €948m last year.
The president listed a range of projects implemented to improve social welfare, despite the economic downturn, including Easter benefits, increased minimum wage, student aid, free school transport, new housing and favourable loans to first-time buyers.
Referring to efforts to improve society’s lot, Christofias qualified that his government pledged to create a “fairer society”, not a “fair one” because the latter was not possible in the politico-economic system that it operated in.
He noted that even the EU was having second thoughts on heavier state intervention following the global crisis.
On rising prices like gas and fuel, Christofias said he was constantly pushing ministers to do what they could, though noting that his “hands were tied” when it came to fixing prices.
“I don’t know when competition works in favour of the people,” he said, adding that the government sought to put price caps on items like milk, bread, medicine and children’s items.
