If the bill for the conversion of Cyta to a private company is not approved, it would be a lost opportunity for the economy and the organization, said the minister of finance Harris Georgiades.
In a pitch to parliament to approve the privatization bill before the Eurogroup meets in early March to announce the exit of Cyprus from its 3-year adjustment program, the minister said that in case the parliament does not approve the bill, this would send negative signals to foreign investors and international markets.
He stressed that the government will continue to insist on promoting the privatization policy agreed with its creditors.
"If the bill does not pass it would be a lost opportunity for the economy and Cyta and it would be as if we are closing our eyes to technological developments" he said.
The first bill provides the ground for turning the public telecommunications company into a private corporate entity and the second deals with the status of its 2600 employees. The government has already guaranteed employees that they will be left on the public payroll if they do not want to work for the privatized telecommunications company.
He stressed the need to approve the bill no later than March 7, when the Eurogroup will meet to end the program. The bill for the creation of Cyta private company is a prerequisite for the disbursement of the last tranche of €275 mn.
Cyprus borrows from the program at a very low rate of 1% compared to the 4.5% it paid last autumn to borrow from the internal markets.
Mr. Georgiades noted that the private company would contribute to enhancing flexibility and competitiveness regardless of whether the state owns 100% of the share capital.
He said it would give a positive signal to rating agencies and international markets, and allow the possibility for an investor to express interest in the coming months. Proceeds from attracting a strategic investor will help reduce the public debt, the minister stressed.
The debt stands at 107% of GDP.
“The presence of an investor would have advantages related to modern investment, such as good management, administrative modernization and technological upgrade”, he added.
He assured that the organization will continue having a leading role in a competitive field, stressing that Cyta will be in a better position to cope with competition.
Mr. Georgiades said there is no decision on the share to be sold, but the state will keep an important share.
The share to be sold will be determined later in the procedure, as he said.
As regards employees of the semi governmental organization, they will continue working at the private company with the same salary and under the same collective agreement.
He noted that as long as the state owns 100% of Cyta, the collective agreement will be renewed and indicated that in case the private company proceeds to redundancies, workers will be used in other positions of the public sector.
In a pitch to parliament to approve the privatization bill before the Eurogroup meets in early March to announce the exit of Cyprus from its 3-year adjustment program, the minister said that in case the parliament does not approve the bill, this would send negative signals to foreign investors and international markets.
He stressed that the government will continue to insist on promoting the privatization policy agreed with its creditors.
"If the bill does not pass it would be a lost opportunity for the economy and Cyta and it would be as if we are closing our eyes to technological developments" he said.
The first bill provides the ground for turning the public telecommunications company into a private corporate entity and the second deals with the status of its 2600 employees. The government has already guaranteed employees that they will be left on the public payroll if they do not want to work for the privatized telecommunications company.
He stressed the need to approve the bill no later than March 7, when the Eurogroup will meet to end the program. The bill for the creation of Cyta private company is a prerequisite for the disbursement of the last tranche of €275 mn.
Cyprus borrows from the program at a very low rate of 1% compared to the 4.5% it paid last autumn to borrow from the internal markets.
Mr. Georgiades noted that the private company would contribute to enhancing flexibility and competitiveness regardless of whether the state owns 100% of the share capital.
He said it would give a positive signal to rating agencies and international markets, and allow the possibility for an investor to express interest in the coming months. Proceeds from attracting a strategic investor will help reduce the public debt, the minister stressed.
The debt stands at 107% of GDP.
“The presence of an investor would have advantages related to modern investment, such as good management, administrative modernization and technological upgrade”, he added.
He assured that the organization will continue having a leading role in a competitive field, stressing that Cyta will be in a better position to cope with competition.
Mr. Georgiades said there is no decision on the share to be sold, but the state will keep an important share.
The share to be sold will be determined later in the procedure, as he said.
As regards employees of the semi governmental organization, they will continue working at the private company with the same salary and under the same collective agreement.
He noted that as long as the state owns 100% of Cyta, the collective agreement will be renewed and indicated that in case the private company proceeds to redundancies, workers will be used in other positions of the public sector.
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