ECONOMY

Cyprus hotel strike averted after unions and employers make compromise deal

NICOSIA (AFP) – A potentially crippling strike at hotels across the Mediterranean holiday island of Cyprus was avoided yesterday after hoteliers announced they had agreed to a compromise deal. Unions had agreed to the package on Monday and hotel owners accepted the deal 48 hours later. «We have unanimously accepted the mediation proposal for renewing the collective agreement, despite a difficult tourist season,» said a statement by hotel owners. «The proposal does not completely satisfy us but we have accepted it for the sake of industrial peace and for the benefit of the national economy,» added the brief statement. Unions threatened an August strike over pay and conditions, but Labor Minister Christos Taliadoros personally stepped in to defuse the crisis. The threat to disrupt the summer breaks of hundreds of thousands of mainly north European tourists led to some holiday cancellations. A key stumbling block was the employers’ insistence that starting wages be reduced, but a compromise formula has been found. The unions say pay for those entering the industry is already low and accused hoteliers of seeking to squeeze out higher-paid Cypriot staff so that they could hire cheaper non-union labor from Eastern Europe. Since Cyprus joined the European Union on May 1, along with nine other countries mainly from Eastern Europe, the hotel industry has seen an influx of workers from fellow new members like Poland and Slovakia. Tourism is a key economic sector, contributing 20 percent of the island’s GDP and generating more than $2 billion in revenues. Tourist arrivals dipped some 25 percent between 2001 and 2003, with the September 11, 2001 attacks in the United States, last year’s US-led invasion of Iraq and the global economic slowdown held largely responsible. Recent figures for 2004 show an upturn of 4.7 percent in arrivals for the first seven months.