09/06/2004 14:55
Finance Minister, Makis Keravnos announced officially on Wednesday the government’s intention to absorb funds from the semi-governmental organizations on a regular basis to cover or reduce the “black holes” on the island’s economy.
“The semi-governmental organizations are the State’s property and belong to the Cyprus citizens. Since the government has clarified that it will not proceed to privatizations, we need to raise the issue of dividend policy. The state will be able to absorb funds by the organization, which will be put in the State Fund to the benefit of the Cypriot citizens”, the Minister said.
Mr. Keravnos avoided referring to specific amounts but stressed the need to change the legislative framework, since after Cyprus’ accession in the EU and the liberalization of telecommunications and power supply, the organizations are non longer non profit.
On the question whether the new policy provides for a privatization with the State as the sole owner, the Minister said that the government has not ended up with specific conclusions yet. “I expect the final proposal and we will discuss details at a later stage”, he said.
“Hypothetical scenario”
On the question whether the government’s policy against privatizations aims at absorbing large funds from the semi-state organizations(£130mln) to reduce the fiscal deficit, the Finance Minister said that this is a “hypothetical scenario”.
“The fiscal deficit will not be covered by the “contribution” of the semi-state organizations, but by a number of measures included in the Convergence Program”, Mr. Keravnos said.
Contradictions of economic rapprochement
Commenting on former Finance Minister’s statements that it would be the last time that the state would absorb funds from the semi-governmental organizations, Mr. Keravnos said that the government thinks in a rational way. “The state has invested millions of pounds in these organizations”.
DISY
“The government is not a ranger and does not plan any inroads against the consumers”, the Minister emphasized, invited to comment on DISY’s claims that the government will launch a tax attack after the Euro-elections.
“We have stated that we will not increase or impose new taxes. The government will use other measures to deal successfully with the fiscal deficit”, the Minister concluded.
“The semi-governmental organizations are the State’s property and belong to the Cyprus citizens. Since the government has clarified that it will not proceed to privatizations, we need to raise the issue of dividend policy. The state will be able to absorb funds by the organization, which will be put in the State Fund to the benefit of the Cypriot citizens”, the Minister said.
Mr. Keravnos avoided referring to specific amounts but stressed the need to change the legislative framework, since after Cyprus’ accession in the EU and the liberalization of telecommunications and power supply, the organizations are non longer non profit.
On the question whether the new policy provides for a privatization with the State as the sole owner, the Minister said that the government has not ended up with specific conclusions yet. “I expect the final proposal and we will discuss details at a later stage”, he said.
“Hypothetical scenario”
On the question whether the government’s policy against privatizations aims at absorbing large funds from the semi-state organizations(£130mln) to reduce the fiscal deficit, the Finance Minister said that this is a “hypothetical scenario”.
“The fiscal deficit will not be covered by the “contribution” of the semi-state organizations, but by a number of measures included in the Convergence Program”, Mr. Keravnos said.
Contradictions of economic rapprochement
Commenting on former Finance Minister’s statements that it would be the last time that the state would absorb funds from the semi-governmental organizations, Mr. Keravnos said that the government thinks in a rational way. “The state has invested millions of pounds in these organizations”.
DISY
“The government is not a ranger and does not plan any inroads against the consumers”, the Minister emphasized, invited to comment on DISY’s claims that the government will launch a tax attack after the Euro-elections.
“We have stated that we will not increase or impose new taxes. The government will use other measures to deal successfully with the fiscal deficit”, the Minister concluded.
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