EIB to present Cyprus’ findings of investment survey during an economic conference in Nicosia

?he European Investment Bank (EIB) will publish Thursday the findings regarding Cyprus of a pan-European investment survey during a major economic conference in Nicosia, in cooperation with the Nicosia Chamber of Commerce and Industry.

According to an EIB’s press release, the findings of the survey show that future uncertainty and high energy costs remain the most commonly cited perceived barriers to long-term investment in Cyprus, with 90% and 89% of the firms reporting these obstacles, respectively.

Public investment in hospital/care infrastructure was also a notable priority for firms in Cyprus, while the particular figure is above the levels reported in any other EU country. Going forward, dealing with the obstacles affecting the country’s long-term competitiveness, including the adoption of innovations, will be key for Cypriot corporates.

Minister of Finance Harris Georgiades and Governor of the European Investment Bank will provide the keynote address and more than 200 business leaders, government officials, policy makers, economists and academics will attend the European Investment Bank’s first ever investment finance conference in Cyprus.

Across Europe investment barriers are preventing small businesses from reaching their full potential and identifying and tackling specific investment barriers is crucial to unlock economic growth and job creation said Jonathan Taylor, European Investment Bank Vice President responsible for lending operations in Cyprus.

He added that the 2017 EIB Investment Report highlights the key impact of investment uncertainty and energy costs in Cyprus.

Director of Nicosia Chamber of Commerce and Industry Socrates Heracleous, said that the European Investment Bank had a unique experience helping companies across Europe to invest, alongside a strong track record of supporting both infrastructure in Cyprus and improving access to finance by Cypriot firms in partnership with local banks.

This week’s timely conference will bring together economic actors and the Cypriot business community and identify key issues essential for future economic and employment growth, he added.

In Cyprus, the 2017 EIB Investment Survey examined investment by 150 firms and identified a marked improvement in access to external financing. Only 6% of firms surveyed were financially constrained, which is slightly under the EU average.

While investment slowly recovers, there is still evidence of 20% of firms having no investment plans for the next 3 years, as a sign of some remaining legacy and need of transformation. Uncertainty, energy costs business regulations and availability of skills are major impediments to investment. Availability of finance is an issue for some firms in some sectors, with cost and collateral requirement being main impediments. highlighted, Debora Revoltella, Director of Economics at the European Investment Bank.

Investment by companies in Cyprus increased in the last 12 months. Approximately 79% of the firms surveyed in Cyprus invested in the last financial year, modestly below the EU average but higher than last year’s result in Cyprus (73%). Investment intensity, investment per employee, has also increased modestly and this positive outlook is expected to continue overall.

Firms in the services sector are the most optimistic, where a large share of firms expected 2017 investment to be below that in 2016. However, 28% of firms in Cyprus reported investing too little over the last three years, well above the EU average of 15%.

Based on interviews of 12,500 firms across all EU Member States, EIBIS provides valuable country-by-country information not available through quantity-based statistics, such as details on investment plans, perceived gaps, the quality of the capital stock, the nature of the investment, financing conditions and the issues impeding investment.

The EIB Investment Report 2017/2018, revealed that while the corporate investment outlook remains healthy, concerns with capital quality and competitiveness prevail.

Source: Cyprus News Agency