22 February 2009 Big Potential for More Bi-communal Trade

Despite concerns, Cypriots are still eager to trade with the other community. This was a major finding of a recent study that has also demonstrated that a significant number of Greek and Turkish Cypriots are already engaged in shopping and trading with the other community.

Current trend of economic interactions
According to the study, completed by Peace and Economic Consortium under UNDP-ACT’s Interdependence Project, which is managed by the Cyprus Chamber of Commerce and Industry (KEBE) and the Turkish Cypriot Chamber of Commerce (KTTO); consumers from both communities continue to spend money in the other community. Credit card usage is still limited and cash is preferred. There are fluctuating trends regarding Green Line crossings, particularly as far as Turkish Cypriot workers are concerned due to the decreased employment opportunities in the Greek Cypriot community after the global crisis.

Concerned but enthusiastic
Supported by their bi-communal team of experts, well known economists Costas Apostolides and Erdal Güryay presented their findings to a group of business people from both communities during a workshop in Nicosia. There were mixed reactions. While some Turkish Cypriot business people expressed concern about the current competitiveness of their businesses, the concerns of the Greek Cypriot business people were mainly on taxation related issues. Nevertheless, the readiness to strengthen business co-operation and extend the co-operation in the services sector too, was emphatically stressed by all.

Key Findings
Some key findings can be summarized as follows:
 

Average expenditure by Greek Cypriots per crossing was Euro 50 and by Turkish Cypriots Euro 70.
 

A significant proportion of firms are willing to enter into bi-communal business cooperation, but there are concerns with the identification of opportunities, bureaucracy and taxes.
 

External factors, including the economic crisis, had negatively affected the overall Green Line trade. Nevertheless, there was increase in the trade of chemical products, plastics, electrical equipment, fish, glassware and ceramic products.

The number of Turkish Cypriots crossing over declined in 2009, probably because of the decline in employment. Nevertheless, Greek Cypriots visits across the Green Line were stable, and the numbers of non-Cypriots increased significantly. Credit Card purchases declined, and were used by only a small proportion of people crossing the Green Line (1% of Greek Cypriots and 10% of Turkish Cypriots).

The findings of the workshop will be included in the report on Economic Interdependence, to be completed shortly.

What is the Economic Interdependence Project?
The Economic Interdependence Project is implemented by the Cyprus Chamber of Commerce and Industry (CCCI) and the Turkish Cypriot Chamber of Commerce and is funded by UNDP-ACT. The main objectives of this project are to promote economic cooperation on the island through activities such as business-to-business meetings, grant schemes for the establishment of joint partnerships and market research, seminars on Green Line Trade and the preparation of a bi-communal business directory.
For more details on the “Economic Interdependence” project, please contact Mrs Lia Riris at the CCCI (tel. 22889840, lia@ccci.org.cy ) and Mr Umut Vehit at the KTTO (tel. 2283760, uvehit@ktto.net ).