Cyprus Minister Sets Out Liberalisation Programme

by Lorys Charalambous

13 June 2002

The Cyprus government has predicted imminent telecoms liberalisation so many times that people have stopped believing in it; but in an interview last week with the Financial Mirror, Minister for Transport, Communications and Works, Averof Neophytou said that all necessary legislation regarding liberalisation had been passed by parliament and the liberalisation of telecommunications, postal services and air transport will go ahead as planned on or before January 1, 2003.

The first step for telecoms liberalisation, said the Minister, will be the sale of additional mobile phone licences. So far, a number of companies had expressed interest but no formal bids had been made.Mr Neophytou said that policy on new licences would be announced in mid-June and that tenders would take place in October.
"How many licences will be given and how we will proceed with the tenders - if we are going to give third generation (3G) licences together with GSM - these are decisions that have to be finalised by the middle of June," he said.

The Minister said that liberalisation of fixed-line telecommunications would follow in 2003 or 2004.

Mr Neophytou admitted that the state-run postal service was very poor, and hopes that new regulation, which includes quality standards, will improve matters. "Of all the sectors in which the government provides services, I think that the postal service is giving the poorest service," he said.

Consumers may have most to gain, however, in air transport. "Air transport is absolute deregulation," Neophytou said. "In the air transport sector within the 15 EU member states there are no obstacles. So with our accession to the EU we will automatically have open skies." Currently Cyprus Airways, almost entirely state-owned, operates a duopoly service to its destinations, carving up the market with its corresponding national operator, British Airlines in the case of the UK. Charter airlines offer an adequate low-cost alternative for holiday travellers, but there is much to gain for business travellers from a wider choice.

Neophytou emphasised that the changes are not taking place just because of demands from Brussels: "We are not doing it because it is an obligation of Europe. We are doing it because we believe in the free enterprise system, in competition and the liberalisation of the market," he said.

The Minister says that liberalisation - of telecommunications, transport and the posts - is key to the government's objective of turning Cyprus into a regional hub. "When you live in a society that has cheap and good quality telecommunications, cheap air transport, an efficient and good quality postal service and if you also have modern airports, ports and good road infrastructure you have the ability to implement your vision to become a real regional hub - the centre for services and the bridge between Europe and the Middle East," he said.

Recommended