The Month in the Cyprus Region, 9 October 2024
Links to off-radar regional developments of relevance to Cyprus
Photo source: Shutterstock.
This is a selection of links to mainly non-paywall articles that are of medium- to long-term relevance to people living and doing business in Cyprus. The main aim is to pick stories or developments of stories which might not have been covered by the Cypriot media. You don’t need this newsletter to tell you that we are surrounded by conflict, therefore I have tried to focus on economic and energy developments. The Month in the Cyprus Region is part of the Sapienta Cyprus Snippets series. Learn more about the different subsections here.
Turkey-Egypt bolster energy relations. Turkey and Egypt signed a memorandum of understanding on energy cooperation in September, covering “electricity, renewable energy, energy efficiency, hydrogen and nuclear energy”. (Sources: CE Energy News and Turkey’s energy ministry. Relevance to Cyprus: Turkey may be stepping into the energy gap left by Cyprus. Cyprus has been waiting for years to consolidate energy relations with Egypt by exporting natural gas to Egypt, either from Chevron’s offshore Aphrodite field or from ENI’s Cronos field in Block 6. However, it is the companies who are in charge of the production schedules and we still have no firm dates for production.
Egypt shifting away from gas? Egypt aims to raise renewable energy sources (RES) in its “energy mix” (presumably in consumption) to more than 42% by 2040. It is also focusing on “green” hydrogen – hydrogen made from green energy sources. (Source: Egypt Today). Relevance to Cyprus: at the moment, Egypt is a net gas importer, being supplied by Israel, and its energy demands will doubtless increase. Nevertheless, the longer Cyprus waits to export gas to Egypt, the greater the risk that the natural gas market will disappear because Egypt will be using cheaper RES instead.
Israeli borrowing costs rising. Conflict is taking its toll on the economy of Israel, which is finding it more expensive to borrow and harder to attract investors. (Source: Reuters.) Relevance to Cyprus: investment from Israeli (and Lebanese) companies setting up on the island has helped the Cyprus economy withstand the reduction of Russian business because of sanctions. Israel is also now the second largest tourism market. However, the pace of increase of business from Israel might slow in future.
EU regulatory focus. EU financial services companies will be asked to focus on “digital resilience and sustainability disclosures” in 2025, judging from a press release by the European Banking Authority (EBA). (Source: EBA). Separately, the First Deputy Governor of Germany’s Bundesbank (central bank), Sabine Mauderer, has written how climate risk might affect the job of central banks. (Source: FT (paywall)). Relevance to Cyprus: in the short term it means more reporting by financial services companies to demonstrate, inter alia, “digital operational resilience”. No doubt it also means more training to ensure that staff are aware of cyber risks, as well as the growing sustainability requirements of financial products.
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Links to the free-to-read Sapienta Cyprus Reflections series
· Mythbusting the population of northern Cyprus, 17 Sep 2024
· Cyprus tourism: the unlikely biggest-spending country 12 Apr 2024
· Cyprus interest rates: how do they compare? 21 Feb 2024
· Green finance: how will it affect your business? 25 Jan 2024
· How to bring the people into a Cyprus peace process, 18 May 2023
· Three mega trends to define the decade, 11 May 2023
· Cypriots and sanctions: lessons for other professionals in Cyprus, 18 Apr 2023
· Cyprus and security: it’s time to change the toolbox, 14 Feb 2023
· What do we know about Turkish Cypriot banks? 4 Jan 2023
· How much is Russian business worth to Cyprus? 12 Dec 2022
· The amazing Cyprus growth machine, 17 Nov 2022
You can find a full list of all posts here.