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On 10th November 2020, the OECD published a Policy Response to Coronavirus (COVID -19) Paper entitled “The territorial impact of COVID – 19: Managing the crisis across levels of government”. This paper takes a thorough examination of the territorial impact of the COVID-19 crisis in health, economic, social and fiscal areas of life providing examples of responses by national governments. UK’s financial stability is faced with an uncertain and difficult economic future. Probably the worst of all. Nevertheless, UK is not the only nation affected from its government’s decisions. It is commonly known that Cyprus has a long-standing bilateral relationship with the UK, reflecting the two countries’ long historical ties, which date back from the declaration of Cyprus’ independence in 1960.
The two countries have developed multi-faceted relations that include political, economic, social, commercial, cultural and educational links. These relations have strengthened following Cyprus’ EU entry and its participation in the Single Market, with the UK being one of the three strongest trading partners for Cyprus.
How is this relationship affected and how are Britain’s Cypriots and even Cyprus itself affected as a sole magnate from the short-term and long-term consequences of the Covid-19 outbreak?
The Socioeconomic Frame
On the socioeconomic frame, the UK government has provided fiscal support to safeguard companies, households and vulnerable populations such as an extended coronavirus job retention scheme. The government has spent about £280 billion since the beginning of the year in order to combat the catastrophe that COVID -19 came to spread. Although important measures have been taken to combat a socioeconomic crisis in the UK, the situation in the UK is undoubtedly more difficult. This picture forces Britain’s Cypriots and British people to migrate their businesses to Cyprus which provides a plethora of benefits to entrepreneurs because of its geographical position, tax regulations and infrastructure.
In addition, people with professional qualifications acquired from a UK College or University are highly demanded for a plentiful array of jobs in the service industry, across Cyprus. Because of the rich history that Cyprus has as a British Colony, English is widely understood and spoken throughout the island. As such English-speaking professionals of any sector can be easily found and English-speaking career opportunities are plentiful across the island. Just over 45% of Cyprus’ population is employed part time and therefore Cyprus can offer promising career opportunities for British people who wish to migrate as a result of reduced incomes and unemployment concerns in the UK. Labour costs in Cyprus in January 2020 were reported to be 106 points and in UK 131 points. On top of these, the average salary in Cyprus is relatively high at approximately €1700 per month. Cyprus may expect a high number of families landing to receive the socioeconomic benefits offered at these unprecedented times.
Recently, the Guardian published an article contemplating that private primary and secondary educational centers have significantly lesser students in each class than state primary and secondary educational centers and, in comparison to state schools, many teachers were able to provide online teaching. Consequently, worried middle-classes are looking to move to private primary and secondary education as the covid pandemic is condemning that further disruption to state education will arise over the following years. In Cyprus there are of course, both public and private primary schools. In fact, public education is available in every village or town where the population of children exceeds fifteen. CyprusMail post dated November 26, 2020 shall relieve migrants wishing to move to Cyprus as the governmental measures focus on the safety of pupils and health in schools. More importantly, public schools continue the lessons through distance learning where it is not possible to do so due to the measures.
Purchase or Rent of Property – Commercial Frame
Although Cyprus procedure to buy a house is based on the UK legal system, price tags are at least incomparable. Arguably Cyprus provides the picture-perfect combination of favourable location, development, ultra-prime residential market and matching price tags. Unfortunately and to add to the fact that buying a property in the UK seems to be a dream, or truthfully a nightmare for most, traveling to Cyprus from Britain was very difficult due to the restrictions. Cyprus inevitably paid the price as it is a very common destination for UK nationals. Consequently, the Covid – 19 outbreak and the travel restrictions imposed have contributed to the fall in sales especially by foreigners. Nigel Howarth declared that during the first seven months of 2020 the number of sales by foreigners has fallen by 43% compared to last year in Cyprus. Because of those restrictions on travel, residence purchase price may fall considerably the following years.
As a consequence of the Covid-19 epidemic, life satisfaction across the whole of Europe has recently dropped significantly from 6.7 to 6.3 (as defined by the McKinsey & Co life satisfaction scale). The cost of living in every country is always dependent on the conditions of living as well as the culture. The way of living has undoubtedly changed dramatically in every affected country worldwide. It is tremendous to think that, coming second only to the food services and accommodation industry, 7 out of 10 workers employed in the entertainments and arts industry were put under the government’s CJRS furlough scheme (Government’s coronavirus job retention scheme). Considering that the regular living expenses in Cyprus are 10.40% lesser than those in the UK, Cypriots previously living in the UK and furloughed may return to Cyprus with 80% of their UK level of income living in Cyprus. Consequently, it will be incredibly affordable to live in Cyprus and the quality of life will be incredibly high. On the other hand, Cypriots who as a result of the coronavirus lost their jobs or left to find health security without any support from the UK government will return to Cyprus without financial security. This will introduce an imbalance to the living conditions of a significant number of Cypriots while others will face significant uncertainty. And even though the percentage of those individuals is not very high it is still an important effect towards Cyprus’ young generation evolution.
Low crime rate
Compared to other European nations of approximately the same size, Cyprus is universally known to have lower crime rates and crimes of lesser violence, thus making the island an extremely safe place. The level of crime in Cyprus amounts to approximately 10 offences per 100,000 inhabitants whereas in the UK it amounts to 117 per 100,000 inhabitants which is a considerable difference. It is worth to note that both across Wales and England there has been a great reduction in crime during the lockdown period where the pandemic was at its peak.
The estimated total cost of the Covid-19 epidemic on the global economy has been estimated by the United Nations (UN) to be a minimum of one trillion dollars only for the year 2020. Especially where countries have strong ties, less or more, the one will always have some effect on the other. Therefore, currently living through the age of globalisation where both humans and economies are strongly interconnected, it is obvious that policy changes and responses in one country will have a knock-on effect on other countries. This has exactly been the case with the UK’s government responses and the effect it has had on Cyprus, and it is now the island’s government responsibility to react to the policies of the UK government and other governments in a way that will mitigate the adverse effects and maximise the opportunities that may arise.
It is also worth noting that given that the pandemic still persists around the world and particularly in the UK and Cyprus, it is reasonable to expect that more regulations will be imposed as the UK’s government continues to deal with the spread of the virus and thus the full aftermath of these responses on the Cypriot population are yet unclear. Therefore, constant monitoring of such regulations is necessary because if Cyprus does not respond effectively and efficiently a domino effect of disastrous consequences may be unavoidable.
The information provided by AGP Law is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.
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