Daily Press Review - 3/9/2019

The role of insurance companies in the digital era

Economy Today presents the new situation in the demanding insurance sector, as well as plans for the new innovative products of insurance companies: General Insurance Cyprus, CNP Cyprus Insurance Holdings, CNP Cyprialife, CNP Insurance, Eurolife, Hellenic Alico Life and Trust. 2019 is expected to be another good year for the insurance company, which is still growing as it did during 2018. According to the preliminary results of the Insurance Association of Cyprus, the first six months of the year, total premiums recorded a 5% increase, while for the entire 2018, total premiums had increased to 7.2%. The article also features an interview with the Director General of Hellenic Alico Life Insurance Co Ltd (part of the Hellenic Bank group), Andreas Papadatos, who speaks about the 18 years that the company has been active in the Cypriot market. He reports that the company has 25 members of staff, while they aim to increase the number of staff to 35 by the end of the year. Since the beginning of 2019, the company handles 120.000 insurance contracts.



A businessman and a bank employee discuss about the behind-the-scenes

Economy Today’s column about economy news, reports that Hellenic Bank will impose a 0.4% charge on the deposits of its big clients, as of 1 October. According to the paper’s sources, this will solely concern clients with tens of millions of euros in the bank. In the case of Hellenic Bank, this only concerns around 5 big clients. As this is something that happens across Europe, it is not ruled out that the remaining commercial banks of Cyprus will also adopt such a policy. On the part of Hellenic Bank, they give reassurances that they will not impose charges on smaller deposits, but that the new policy will solely relate to deposits with millions of euros. The article reports that the Electricity Authority of Cyprus has already been informed about the decision of Hellenic Bank. It is important to note that apart from the employees’ pension fund, EAC also has cash reserves amounting to €400m.



6+1 Business News

Economy Today’s article reports on the most important financial news: new shareholders at Nicosia Mall, record tourist arrivals, the departure of HB’s chairman, a new project by Giovani group, the start of construction for the Nicosia City Centre, the appointment of a new CEO at Bank of Cyprus, €2m profits for BoC. The article specifically reports on the departure of the Hellenic Bank’s chairman of the BoD. Youssef A Nasr, withdrew his re-election nomination. According to a relevant announcement, he withdrew his candidacy due to personal reasons. According to a press release, Christos Themistocleous has been nominated for election in the BoD, at the Bank’s AGM on 28 August, as an independent non-executive member.

 

Additional safety net provisions and first day of ESTIA

According to Phileleftheros’ sources, 40 borrowers applied for the scheme on the first day of Estia at Bank of Cyprus, KEDIPES and Hellenic Bank. 17 applications were submitted to Bank of Cyprus, even though they expected at least 50 applications. It should be noted that BoC expects around 4 thousand clients (by 10 thousand borrowers with NPLs worth €840m) are eligible for Estia. At the same time, KEDIPES received only 10 applications. However, 140 borrowers received applications and asked information about their eligibility. 7.300 KEDIPES clients are eligible for Estia, with €1.3b worth of loans. Hellenic Bank received only 12 applications, while many borrowers were requesting more information about the scheme. Hellenic Bank has sent around 1.050 letters for loans worth €250m. A very small number of borrowers applied at Alpha Bank, AstroBank, Eurobank, the National Bank of Greece, the Housing Finance Corporation and Gordian Holdings. It is estimated that around 1.000 loans at the Housing Finance Corporation will be incorporated in Estia, with a total value of €100m. Applications are open until 15 November.



Sluggish interest for ESTIA

Same as above, Politis reports on the first day of ESTIA, noting that not many borrowers expressed interest in the scheme so far. The article reports that 10 borrowers submitted an application at Hellenic Bank and 17 borrowers submitted an application at BoC. The article also notes that the Cyprus Bank Association stressed that the successful completion of Estia requires cooperation between the borrowers, the banks and the state bodies, so that the scheme fulfils its goal, which is to safeguard the primary home of thousands of households in Cyprus and at the same time reduce the NPL rate.



Government unit for participation in banks to cease operations

The Unit managing the participation of the RoC in the Ownership Structure of Credit Institutions will cease operations, after a relevant bill was submitted to the Parliament. According to the bill’s introductory report, after the sale of part of the Co-op’s business to Hellenic Bank and the creation of SEDIPES/KEDIPES, there is no longer a need to keep the Unit going. It should be noted that the need for the creation of the Unit, emerged in the framework of the process to restructure and recapitalise the Co-operative Credit Institutions. This was a requirement for the concession of the €1.5b needed for the recapitalisation of the Co-op.



HB Pelendri branch shutdown met with protests

Hellenic Bank’s decision to shut down the bank’s branch in Pelendri, which serves the needs of the community as well as other communities of the region was met with protests. According to the communities, this decision was taken without previously informing or discussing with the local community. The Limassol district committee of AKEL said that it will cooperate with the local authorities and the organised communities, in order to reverse the decision. In the case where there is no positive result, AKEL declares that it will support every mobilisation that will take be organised over the coming period. AKEL says that the government, must find a way to support the people of the rural areas, who are seeing the branches that they themselves built decades ago, shutting down one by one.



DIKO: closure of bank branches in rural areas causes problems

In a press release DIKO said that it proposed to the House Finance Committee, the urgent investigation into the closure of former Co-op branches in rural areas, due to a decision by the Board of Hellenic Bank. The most recent example of such a decision was the shutdown of the bank’s branch in Pachna. DIKO believes that the Banks’ move to cluster their branches in the rural areas, causes serious social problems, both for residents of the areas (especially seniors and farmers) as well as for the everyday financial activities of local family businesses and farmers. In any case, the lack of financial activities in the area, hampers the rejuvenation of the rural areas and contributes to urbanisation and the further deterioration of these communities.



Cruise giants in Cypriot waters

Cruise tourism is a trend that has been gaining ground in recent years, both in the Cypriot public as well as foreign travellers. As part of its plans to upgrade the multiple use terminal at Limassol port, DP World Limassol proceeded with new investments in equipment and an upgrade of the new passenger terminal. According to the company’s General Manager, Limassol port is a main driver of growth and DP World Limassol contributes substantively to its upgrade, in extent having a positive impact on the country’s economy and creating multiple benefits for the local community. There are positive messages as regards cruise tourism, which has been following an upward trend that is expected to continue in 2020. Ever since DP World Limassol took over the management of the passenger terminal, it has served over 180,000 passengers who arrived at the new terminal, as a transit station or as a homeport. By the end of July 2019, DP World Limassol served over 30 cruise ships while there has been a notable increase in arrivals (in excess of 35%), as there were 68 arrivals in 2018 and 93 in 2019, of which 53 were in transit and 40 as a homeport. Furthermore, the company has made considerable investments in upgrading the new terminal and boosting the visitors’ experience. Indicatively, it has redesigned the landscape surrounding the terminal, installed an automated irrigation system and smart screens in the arrivals and departures rooms, as well as renovated the interior/exterior areas. As part of the new passenger terminal’s upgrade, two duty free shops are expected to open, while the magazine reminds that DPWL received an award at the Cyprus Tourism Awards, in the “Strategy and Innovation” category, as well as an award as the “Most Effective Cruise Terminal” at the first MedCruise Awards.



They swam from Mersin to occupied Kyrenia

Students on the swimming team of Hacettepe University in Ankara swam from Mersin port to occupied Kyrenia within 24 hours, according to the Turkish Cypriot press. The students had made a bet that they could do the swim in 24 hours. The team headed off at noon on Sunday and arrived in the occupied areas at noon yesterday. They were accompanied by the so-called ‘port police’ of the occupied areas.



PASYXE Paphos - September down in occupancy and revenue

The poor performance for Paphos tourism appears to have continued into September, with the Paphos branch of hoteliers’ association PASYXE’s president Thanos Michaelides telling CNA yesterday that occupancy rates continue to be very low, with the overall rate for the year expected to be down 7% to 10% compared to last year. He said the drop in occupancy as well as revenue is not expected to change by the end of the year, as the peak season has already passed.



Capital’s hotel map has changed

Economy Today presents the new hotels that have been added in Nicosia, as well as all the changes that have been made in the hotel industry over the recent past. Among other, it refers to the former Hilton Hotel, which has now changed ownership as of 1 June and will now go by the name The Landmark Nicosia. The Hilton Park in Nicosia recently celebrated its 100^th anniversary and received another star, making it five-star. The former Holiday Inn in Nicosia is now being rebranded as the Wyndham Grand; and a Radisson Blu Hotel will be built in the capital.



They are proceeding with constructions despite suspension measures

Construction work on two new tourism complexes in the coastal Oroklini area of Larnaca is proceeding without the necessary state permits. In one case, the Town-planning department has warned it will fine the applicants, and in the second the Larnaca District Officer is taking measures against them.



19 hotel professions with a minimum wage

Nineteen professions in the hotel industry will have a minimum wage, according to the compromise proposal that was sent yesterday by the Labour Minister to the hoteliers and employees’ unions for the renewal of the industry’s collective agreement. According to the proposal, the ministry will issue a decree defining the minimum wage for these professions, which include, Porters, receptions, chambermaids and pool maintenance workers. The wages will range between €870 and €1,070, depending on the months of service.



Special Feature: Construction/Subcontractors

In Business issues a special Feature on Construction and Subcontractors, which includes an Index of Construction companies in Cyprus. They present companies who collaborate with these construction/subcontractor companies, comprised of enterprises from a wide range of industries. The index begins with Hadjiyiannis firm, which was established in 1967 and for over half century has been active in import/distribution of a wide range of construction products and colours, in more than 300 stores in both Cyprus and Greece. Hadjiyiannis company’s products are high-quality and generally have a good reputation and that is why they are chosen by experts for the construction of large projects, something that makes the company’s people very proud. Hundreds of projects all across Cyprus, as well as abroad, are completed or are now under construction with Hadjiyiannis products. Some of the ongoing projects Hadjiyiannis is involved in, include the City of Dreams, Limassol’s new casino and the Ayia Napa Marina.



Construction: Profiles of 13 companies of the industry

In Business, as above, presents a special feature for the large construction/subcontractors’ companies in Cyprus, including City of Dreams Mediterranean. Following a competitive tender process, and having received all the necessary approvals by the Cyprus Government, the Integrated Casino Resort Cyprus Ltd (ICR Cyprus) assigned the construction of the integrated casino – resort, City of Dreams Mediterranean, to the consortium Avax – Terna J.V (previously known as J&P Avax – Terna J.V.). Avax holds a 60% of the consortium, while Terna holds the remaining 40%. The project has already begun and its completion is expected within 2021. City of Dreams Mediterranean will be located in West Limassol and is harmonised with its surroundings. Upon completion it will be the largest casino – resort of the wider region and Europe. The main building will include a 16-storey hotel with 500 rooms and luxury suites overlooking the sea and balconies over the yard. It will include exhibition and conference rooms, 4 large external pools, jacuzzi, and a playground. It will offer over 100 tables and 1000 high-tech slot machines. Following its second year of operation, it is expected to contribute around €700m to the Cypriot economy per year, 4% of our country’s annual GDP. It also includes Rotos Group, which developed the 75-metre Wargaming building, which is different from any other conventional buildings due to building’s energy efficiency features, as the photovoltaics on its roof and the automation system of the machinery, reduce energy needs.



Projects that will make history

The construction sector is one of the lungs of the Cypriot economy, as it made a huge recovery in the last few years, following the 2013 financial crisis. That was perhaps the most severe blow since the Turkish invasion. The sector’s contribution to the country’s GDP reaches 10% and goes beyond 7% in the employment industry. Large projects in Cyprus have attracted the interested of foreign investors and buyers. In this issue, they present some of the biggest construction companies in Cyprus and important developments that changed and continue to change the construction map of the island, making history in the industry. Some of the examples include the Limassol Marina, Ayia Napa Marina, City of Dreams Mediterranean.



New plans for tourism

Interview with the Deputy Minister of Tourism, Savvas Perdios who says that Melco’s investment proves that this great investor believes in the potential of the Middle Eastern and Gulf market. In this way he justifies Cyprus’ turn to this specific market. “This year for example, one of the most important increases in tourist arrivals was Israel. This is not surprising. Are you aware that each week there are 50 flights from the US to Israel? So, I believe that these countries will help us attract more distant countries as well. Already, there are direct flights. Indeed, I was just recently looking at statistical information about Greece, which by the end of May experienced a 8% drop in arrivals from the EU, and a 15% increase in arrivals from countries outside of the EU. On the other hand, our competitors, Egypt, Morocco, Tunisia, Turkey have the same clients as we do; so, we have to question our activities in the coming years and slightly amend our targets”.



EDEK: the MoH is violating the law by requiring GP referrals

EDEK claims that the MoH is violating the law by forcing patients to get a referral from their GP to their specialized doctor, in order to be able to receive primary healthcare services. “We regret that this is not the first time the MoH has violated the relevant legislation”, EDEK concludes. It’s worth noting that according to the MoH, a GP referral is necessary in order so as to receive any services from specialized doctors or Okypy’s services. A referral is also required for medical tests at Okypy hospitals.



Most state pharmacies shut down

Phileleftheros reports that they are going over the state pharmaceutical stock, following the shut-down of most state pharmacies, as well as the restructuring procedure of Okypy’s pharmacies that will remain open, as they have realised that the state has more than sufficient stock which can be distributed through Okypy to private pharmacies, to tackle some shortages that still remain in specific products. The stock-taking process has already begun and is expected to be completed by 11 September, while Okypy will calculate the quantities need to cover its patients’ needs, and in turn provide the HIO with the remaining stock that will be distributed to private pharmacies. The author also reports that meanwhile, the 15 state pharmacies that will remain open, are now fully equipped to serve their patients through the GHS. Yesterday, was the first day that state pharmacies were not in operation, and a few problems emerged as some patients had not been informed and expected to receive their medication. The continuous announcements of the MoH over the last few days were apparently insufficient, as some patients did not follow the necessary procedure. They visited their specialized doctors without a referral and they were later asked to pay the €25 additional fee, which they refused.



KTTO’s proposals about the checkpoints

According to a T/C newspaper, the T/C Chamber of Commerce (KTTO) presented a report, with proposals on how to facilitate crossings at checkpoints, on 28 August addressed to their “Prime Minister” Ersin Tatar. This report was drafted following the significant increase of people using the checkpoints to cross to the occupied areas. Data shows that in 2017, 2 million people used the checkpoints, while in 2018 that number rose to 3,5 million. In the first quarter of 2019, over 2 million people crossed. An increase was also observed in the use of G/C credit cards in the occupied areas. In their report, KTTO states that in order to facilitate this upward trend, procedures at the checkpoints need to be sped up, more people should be hired, while Ledra Palace should be opened to vehicles. They also recommend opening a checkpoint in West Nicosia, as an alternative crossing for vehicles. KTTO also noted that they should appoint a government committee that will assess these proposals as soon as possible, and note that the increase of crossing points will facilitate growth in the occupied areas and strengthen relations between G/C and T/C.