Day: January 18, 2023

Cyprus has proven its resilience in the face of the crises like the coronavirus pandemic and the Ukraine war, said tourism boss Savvas Perdios citing improved tourist arrivals for 2022.

Tourist arrivals hit 3.2 mln last year, despite Cyprus losing 800,000 Russian and Ukrainian tourists due to the war.

Visitor arrivals spiked 65% in 2022 after COVID-19 travel rules were dropped.

Due to Russia’s invasion of Ukraine and the ensuing EU sanctions, Cyprus was deprived of 800,000 arrivals, but tourism recovered to around 80% of pre-pandemic levels.

The island is around 700,000 tourists short of the record year 2019, when arrivals peaked at 3.9 million.

“The conclusion we can draw from last year is that our tourism is more resilient and that we can now say that Cypriot tourism does not depend on the Russian market”, Perdios told the Cyprus News Agency.

He said the diversification and strengthening of the resilience of Cypriot tourism were demonstrated by the results of 2022, especially revenues, which were 90% of 2019.

“Reaching 90% of 2019 revenue ranks Cyprus in the top 20 countries worldwide in revenue recovery, compared to 2019”.

As he pointed out, based on available data, the per capita expenditure of tourists in Cyprus was €760 for 2022, while in Greece, it was €646.

Per capita expenditure in Cyprus recorded an increase of 12% compared to 2019, an increase not attributed to inflation, “as tourism operators in Cyprus had granted reduced prices”.

Perdios said the UK remains the backbone of the tourism industry, while arrivals from EU destinations recorded impressive jumps.

“2022 was the year of historical records for arrivals from Poland, France, Italy, Denmark, Austria and Hungary, while Germany and Switzerland set 20-year records.”

Compared to 2019, total arrivals from the EU saw a 24% increase, while arrivals from Poland jumped 133%, followed by France at 98%, Denmark at 67%, Austria, Hungary, and Italy with an increase of 58% and Germany up 31%.

More flights

Perdios said 2023 has kicked off with encouraging messages from the UK, where demand remains at the usual high standards, with Cyprus being amongst the top 10 preferred destinations for Britons this summer.

He added that at least another ten destinations are expected to send in a good number of tourists.

There are increased routes for 2023, with Ryanair, Wizz Air and Cyprus Airways adding additional flights to their schedule.

Perdios said that flights from the UK would represent less than 30% of flights this year, unlike previous seasons.

“During the summer, we will have 56 flights per week from Israel, 45 from Germany, 45 from Scandinavia, 34 from Poland, 25 from Austria, 24 from Italy, 22 from France, 20 from Switzerland, 20 from Serbia and 14 from Hungary”.

He expects flights from three Saudi Arabian cities to Cyprus will soon be added.

“The penetration to new markets, and the increase in flights, is expected to boost EU arrivals, which last year accounted for 41% of all tourist arrivals.

“Based on the data we have, it looks like we’re going to outperform 2022’s revenue.

“We will focus more on the revenue side, as we’re likely to reach 2019’s performance.”

Tourism has traditionally been a key driver of the economy, contributing around 15% of Cyprus’ GDP.

Pre-coronavirus 2019 was also a record year for tourism revenue, with spending at €2.68 bln.

In 2022, tourist arrivals totalled 3,201,080 from 1,936,931 in the previous, 631,609 in 2020 and 3,976,777 in pre-COVID 2019, announced the Statistical Service.

In December 2022 alone, tourist arrivals reached 110,041, from 96,928 in December 2021, recording an increase of 13.5%.

Arrivals from the United Kingdom were the main source of tourism for December, with a share of 24.3% (26,708), followed by Israel with 17.1% (18,801), Greece with 11% (12,055), Poland with 8.5% (9,316) and Germany with 4.5% (4,976).

Source: The Financial Mirror

Cryptocurrency trade volumes saw a significant drop in December, the last month of one of the hardest years for the entire crypto industry, with Tether and Bitcoin retaining their market leadership.

Following the U.S. Fed’s rate hike moves, the price of the world’s leading crypto, Bitcoin, dropped to the lowest of $16,400 at the end of last month, the value last seen in November 2020, while Ethereum ended the month with a 7% drop to $1,195.

Tether, Bitcoin and BinanceUSD were the three most traded cryptos in the last 30 days, but their trading volumes dropped deep below the levels seen a month before, according to data presented by CryptoPresales.com.

Tether volume plunged to $603 bln

Approaching the end of the year, many traders and crypto investors took a break, causing a slowdown in crypto trading activity.

In November, Tether hit a record trading volume of $59.6 trln as investors flew to the safety of US dollar-denominated tokens after the collapse of FTX. Although the world’s leading stablecoin remained the most traded cryptocurrency, its trading volume slumped to $603 bln in December or 98 times less than the value seen a month before.

The CoinMarketCap data showed that Bitcoin’s trading volume tanked 33% month-over-month, falling from nearly $635 bln in November to $420 bln in December. Furthermore, this was the second month in a row in which Bitcoin’s trading volume stood deep below $1 trln seen earlier in 2022.

With $123.7 bln in 30-day trading volume, Binance USD ranked as the third most-traded crypto, one spot above Ethereum. Still, like other cryptocurrencies, it also witnessed a considerable month-over-month drop, with its trading volume plunging by 55%, compared to November.

ETH’s trading volume continued falling throughout December and hit less than $100 bln, a 70% drop month-over-month and 80% less than $475 bln seen in October.

With $72.8 bln in 30-day trading volume, a massive 40% drop month-over-month, USD Coin ranked as the fifth most popular crypto to trade in December.

Aptos and Zilliqa enter Top Ten

The CoinMarketCap data showed significant changes in the other half of the list, with four out of five cryptos ranked in November losing their spot last month.

XRP, WETH, Dogecoin and Polygon were all among the ten most-traded cryptos in November, but didn’t even make it to the list in December as their trading volumes slumped.

Statistics show Solana was the sixth most-traded crypto last month, with $64.2 bln in 30-day trading volume. Far below, with a trading volume of $19.7 bln, BNB ranked as the seventh most popular crypto to trade.

Compared to November, three new cryptos entered the most-traded list.

With $18.1 bln in monthly trading volume, Aptos ranked eighth on the list of most popular coins. Also, statistics show the price of the APT token jumped by 20% in the last month, rising from $4.67 to $5.62.

Cardano and Zilliqa close the top ten list, with $18 bln and $14.1 bln in monthly trading volume, respectively.

Source: The Financial Mirror

Electricity generated from renewable energy sources in Cyprus could eventually make up as much as half of all power conveyed to other countries through an electricity cable linking the island’s power grids to Israel and Greece, officials said.

Energy Minister Natasa Pilides told reporters that renewable sources produced almost 15.2% of Cyprus’ electricity last year, nearly 4% more than in 2019.

That figure contributed to a nearly 3% increase in electricity generated from solar panels in 2020, reaching 9.2% last year.

Pilides said her ministry is consulting with the European Union about increasing the country’s 2030 target for RES-generated electricity from the current 23%.

Construction of the EuroAsia Interconnector cable by the Norwegian subsidiary of French cable manufacturer Nexans is slated to begin before summer.

The first phase, with a 1,000-megawatt capacity, is expected to be completed in 2026.

The cable to Greece and Israel, which will eventually have a 2,000 MW capacity, is touted as the world’s longest and deepest subsea electricity cable, at 1,208 kilometres and 3,000 metres.

It will cost roughly €1.6 bln ($1.56 bln), with the EU providing a little under half of the funding.

Cyprus is the only EU country not linked to the power grid of another member of the 27-nation bloc.

Government officials said constructing the electricity cable would end the country’s energy isolation and provide greater security.

Source: The Financial Mirror

Digital adoption across economic sectors will determine the path of future growth, according to an analysis of the University of Cyprus’ Economic Research Centre.

The analysis stresses the importance of digital uptake to increase productivity.

According to the analysis of “Sectorial Labour Productivity Trends in Cyprus” between 2015 – 2021, the technology-intensive sectors experienced a productivity surge, whereas industries that rely on face-to-face contact performed the worst.

According to the conclusions of the research, between 2015 and 2019, after the economic recession and before the COVID-19 crisis, Cyprus’ economy enjoyed, on average, 1.1% labour productivity growth.

The highest labour productivity growth was observed in the Information & communication sector, with 6.4% growth.

This was due to the Total Factor Productivity (TFP) growth in the sector, which more than compensated for the reduction in capital deepening.

Real estate and the financial & insurance activities sectors’ output per labour contracted by 7.1% and 5.2%, respectively.

Most of the loss in the Financial & insurance sector’s labour productivity was almost entirely attributed to its TFP reduction.

During the COVID-19 pandemic and recession in 2020, sharp declines in growth occurred: real output and labour growth fell by 4.5% and 6.5%, respectively.

Nevertheless, labour productivity growth rose to 2%.

Unlike previous recessions, after COVID-19 in 2021, growth rebounded rapidly, with output and labour recovering by 6.4% and 4.7%, respectively.

The analysis of sector-level data showed that the impact of the shock had been asymmetric across sectors.

Labour productivity growth increased soon after the first lockdowns in technology-intensive sectors such as the Financial & insurance activities and the Information & communication (ICT) sectors, where working remotely was feasible, and firms could take advantage of new digital/online solutions.

The gains in labour productivity growth, even though to a lesser extent, were retained during 2021.

In sectors like wholesale, retail & accommodation, the Arts, entertainment & recreation, and Construction that rely more on face-to-face interactions, the containment measures had a negative impact on labour productivity growth.

“The acceleration in digital uptake could be a positive outcome of the crisis.

“To the path towards higher productivity growth, policies that target on increasing the degree and the speed of economy’s digitalisation are of the utmost importance”, the study said.

Equally important for long-term productivity are solid economic institutions, labour market flexibility and physical and digital infrastructure.

Source: The Financial Mirror

Property sales worth €17 bln have been recorded by the Land Registry since 2018, with 2022 being the best year, according to the latest data.

The value of the property sold between 2018 to 2022 will increase as transactions for some sales documents submitted have yet to be completed.

According to Land Registry data, the total value of the properties sold amounted to €17.3 bln, with the largest amount recorded in 2022 and the smallest in 2020.

Specifically, the value of properties sold in 2022 was €4.18 bln, compared to €3.19 bln in 2021, with €2.73 bln in 2020, €3.55 bln in 2019 and €3.61 bln in 2018.

The amount of €17.3 bln corresponds to 90,251 real estate sales over five years, for which a title deed has been issued, and the transfer has been registered with the Land Registry.

Last year, real estate sales reached 20,799 from 18,463 in 2021, 14,663 in 2020, 17,988 in 2019 and 18,336 in 2018.

Total real estate sales, with or without titles issued, were 148,689, of which 41,146 took place in 2022, 28,810 in 2021, 22,631 in 2020, 28,354 in 2019 and 27,578 in 2018.

Foreign buyers

European and foreign property buyers saw a sharp increase in 2022.

For the five years, Cypriot buyers were 79,287, Europeans 6,750 and from third countries 4,003.

Of the 20,799 sales made in 2022, 16,676 buyers were Cypriots, 2,645 were from the EU, and 14,78 were from outside the bloc, compared to 2021, where 15,406 properties were purchased by Cypriots, 1,987 properties by EU citizens and 1,070 from non-EU countries.

In 2020, Cypriot buyers were 12,231, Europeans 15,59 and foreigners 873, compared to 17,076, 524 and 388, respectively, in 2019.

At the same time, 78,502 property donations were made, of which the largest number was in 2022 and the smallest in 2020.

In 2022, 17,283 property donations were made from 16,781 in 2021, 12,952 in 2020, 15,947 in 2019 and 15,539 in 2018.

Source: The Financial Mirror

Some 73% of CEOs believe global economic growth will decline over the next 12 months, the most pessimistic outlook in over a decade, said PwC’s Global CEO Survey.

The bleak CEO outlook is the most pessimistic regarding global economic growth since PwC began asking this question 12 years ago.

It is a significant departure from the optimistic outlooks of 2021 and 2022 when more than three-quarters (76% and 77%, respectively) thought economic growth would improve.

Not economically viable

In addition to a challenging environment, nearly 40% of CEOs think their organisations will not be economically viable in a decade if they continue their current path.

CEOs confidence in their own company’s growth prospects also declined dramatically since last year (-26%), the biggest drop since the 2008-2009 financial crisis when a 58% decline was recorded.

Globally, business confidence around economic growth varies starkly, with G7 economies, including France (70% v 63%), Germany (94% v 82%) and the UK (84% v 71%) – all weighed down by an ongoing energy crisis – more pessimistic about their domestic growth prospects than they are about global growth.

Inflation

While cyber and health risks were the top concerns a year ago, the impact of the economic downturn is top-of-mind for CEOs this year, with inflation (40%) and macroeconomic volatility (31%) leading the risks weighing on CEOs in the short-term – the next 12 months – and over the next five years.

Close behind, 25% of CEOs also feel financially exposed to geopolitical conflict risks, whereas cyber risks (20%) and climate change (14%) have fallen in relative terms.

The war in Ukraine and growing concern about geopolitical flashpoints in other parts of the world have caused CEOs to rethink aspects of their business models, with almost half of respondents that are exposed to geopolitical conflict integrating a wider range of disruptions into scenario planning and corporate operating models either by increasing investments in cybersecurity or data privacy (48%).

Cutting costs

In response to the current economic climate, CEOs want to cut costs and spur revenue growth.

And 52% of CEOs report reducing operating costs, while 51% report raising prices and 48% diversifying product and service offerings.

However, more than half – 60% – say they do not plan to reduce the size of their workforce in the next 12 months.

A vast majority – 80% – indicate they do not plan to reduce staff remuneration to retain talent and mitigate workforce attrition rates.

Trust and transformation

CEOs noted the need to collaborate with a wide range of stakeholders to build trust and deliver sustained outcomes if they are to generate long-term societal value.

The survey found that when organisations partner with non-business entities, it is to address sustainable development (54%), diversity, equity, and inclusion (49%), and education (49%).

Technologically

More than three-quarters (76%) of organisations say they are investing in automating processes and systems, implementing systems to upskill workforces in priority areas (72%), and deploying technology such as the cloud, AI, and other advanced technology (69%).

However, many CEOs question whether critical preconditions for organisational empowerment and entrepreneurship are present in their companies to tackle the increasingly complex risks organisations face.

For example, only 23% of CEOs say leaders in their company often/usually make strategic decisions for their function without consulting the CEO.

Further, only 46% of CEOs say leaders in their company tolerate small-scale failures often/usually.

However, more optimistically, nearly 9 in 10 (85%) respondents say the behaviours of employees are often or usually aligned with their companies’ values and direction.

Bob Moritz, Global Chair, PwC, said: “The risks facing organisations and society today cannot be addressed alone and in isolation.

“CEOs must therefore continue to collaborate with a wide range of public and private sector stakeholders to effectively mitigate those risks, build trust and generate long-term value – for their businesses, society and the planet”.

Almost 160 CEOs from Cyprus participated in the study, reflecting the business community’s growing interest in the survey.

Source: The Financial Mirror