President Nicos Christodoulides on Thursday reiterated the government’s commitment to supporting the construction sector and the property market in Cyprus. His statement was made at the annual general meeting of the Cyprus Developers Association , which was held at the headquarters of the Federation of Employers and Industrialists (OEV) in Nicosia.
“The construction sector, rightly called the ‘engine of the economy’, plays a key role in demonstrating Cyprus’s enormous potential for business development ,” the President noted. “Your contribution over the past 41 years has been vital to the economic and social development of our country,” he added.
Christodoulides acknowledged that inflation, the ongoing conflict in Ukraine and tensions in the Eastern Mediterranean were creating additional challenges for the sector. “External factors have created significant pressure on your sector,” he said. “But as a government, we are acting, not just talking, to ensure that you adapt smoothly to the changing environment and take advantage of the opportunities that arise.”
The President also cited recently announced reforms to the building permit process as an important government initiative. “Over the past year, we have implemented a comprehensive reform of the building permit procedures ,” he explained. “Starting with 22 measures, we have significantly reduced the delays that previously hampered your operations and created unnecessary difficulties for citizens.”
One of the most significant measures was the accelerated issuance of permits for small-scale construction . “Since October this year, permits for urban development activities for low-risk properties, such as one- and two-family homes, have been issued within 20 working days ,” the president said. “From January, this will also apply to building permits, reducing the time needed to obtain all necessary permits to 40 working days .”
The president also announced the next stage of reforms. “In March, we will launch the second stage, focused on medium-risk projects . The necessary permits will be issued within 80 working days, providing greater flexibility and efficiency for both citizens and businesses.”
He also stressed that affordable housing remains a priority for the administration. “Our comprehensive housing policy includes seven schemes aimed at increasing supply and improving the purchasing power of citizens,” Christodoulides said .
He also promised increased funding for these initiatives, saying, “As long as there is public interest, the government is prepared to invest even more to ensure that everyone benefits .” The president also praised the private sector’s response to government incentives. ” I have heard that there has been strong interest from developers in taking advantage of the additional development factor provided by our urban planning incentives. This helps us achieve our goal of increasing the housing stock , especially affordable options,” he added.
Announcing the establishment of the business support centre, the President said: “This new centre will be a one-stop shop for Cypriot and foreign entrepreneurs. Our aim is to provide timely information and personalised advice, which will enhance efficiency and productivity.”
He also warned against legislative proposals being discussed in parliament, which he believes could be counterproductive. “Some proposals, although they sound attractive, have already proven their ineffectiveness in other EU countries,” the president warned. “They could do more harm than good to our economy,” he added.
The president also noted the need for reforms in the banking sector. “Banks must reduce interest rates and find effective solutions,” he said. “We are working in this direction, but we must be careful to avoid measures that could worsen the problems rather than solve them .”
The real estate sector contributes 15% to Cyprus’ GDP
Meanwhile, Yannis Misirlis , the association’s president, called 2024 a “year of dynamic development” for the real estate sector. He said the industry accounts for 15% of the country’s GDP and employs more than 40,000 people, highlighting its role as a key pillar of the Cypriot economy.
Misirlis attributed the stability of the sector to the flexibility, innovation and strategic initiatives of developers, as well as modern and technologically advanced projects.
He also said the industry had overcome significant challenges, including the housing crisis, licensing delays, inflation, high interest rates and geopolitical tensions.
Misirlis stressed the importance of cooperation with the government and various ministries, calling this partnership based on mutual respect and a common vision for improving the situation in the industry.
The association’s president also called for fast-track licensing to address the thousands of backlogged projects, which he said would increase the supply of residential properties, solve the housing problem and stabilize property prices.
He also drew attention to the acute labour shortage in the sector and called for the development of a comprehensive strategy to ensure the competitiveness and growth of the sector.
Regarding green initiatives, Misirlis said that there is a need to implement green practices in the industry. He mentioned that technological advances, including artificial intelligence, offer opportunities to improve efficiency and productivity.
