ECONOMY

Greece and Cyprus look east

Greece and Cyprus said yesterday they are planning a joint drive to tap their respective economic and business vantage points in the Balkans and Eastern Europe. «Greece is very strong in the Balkans. Cyprus has special relations with Russia and Ukraine. In our next meetings, we shall see how we can expand in these countries, possibly with consortia or other joint action, to the benefit of both our economies,» said Cyprus Finance Minister Harilaos Stavrakis after meeting with his Greek counterpart Giorgos Alogoskoufis in Athens. «We have many things in common. Both the Greek and the Cypriot economies rely a lot on an outward-looking orientation and want to boost the prospects in the broader region, in Southeastern Europe and the eastern Mediterranean,» said Alogoskoufis. Stavrakis further urged Greek entrepreneurs to tap the opportunities that the Cyprus economy offers and invest in the island republic. The sectors that provide such opportunities include renewable energy sources, water resources, quality tourism, shipping, private education, health services and public infrastructure projects. He said Cyprus was noted for its high growth rates, averaging 4 percent in recent years, a stable fiscal environment, full employment and a favorable tax regime for businesses. Stavrakis said he was optimistic that a solution of the Cyprus problem would lead to an economic «miracle» and an acceleration of growth rates, while also saving important resources from the reduction in military spending. He said the Cyprus banking system was in excellent health, with almost zero exposure to subprime loans and risky products. He added that his government would continue with reforms, focusing on limiting the size of the public sector and on boosting its productivity.