The Cyprus Stock Exchange is on the brink of privatisation as MPs concluded discussions on the related bill, aiming for legislative approval by month-end.
- The Cyprus Stock Exchange is on the brink of privatisation as MPs concluded discussions on the related bill, aiming for legislative approval by month-end.
Established in 1993, the Cyprus Stock Exchange (CSE) operates as a public corporate entity, accountable to the state with its budget presented annually to the House of Representatives. As a semi-governmental organisation, it is also subjected to audits by the auditor-general.
Political consensus has emerged around the proposal to privatise the CSE, which the current government introduced to parliament back in June. During a session of the House finance committee, legislators expressed the importance of ensuring that the sale to a “strategic investor” is guided by qualitative criteria, rather than solely relying on the highest price per share.
Concerns were raised regarding the bill’s language, which currently emphasises financial bidding. MPs are advocating for revisions that would incorporate qualitative measures in the selection process for the investor. They are now awaiting a revised draft from the government.
The proposed legislation allows for the potential sale of between 75 to 100 per cent of the CSE, providing an opportunity for the state to retain a minority stake. This move comes amidst reports of declining turnover at the exchange, making the search for a suitable investor a key milestone within Cyprus’ Recovery and Resilience plan.
Support for the privatisation is widespread among political parties, including Akel, which has historically opposed such measures. Akel MP Andreas Kafkalias noted that the party has made an exception in this case, recognising the unique nature of the financial market.
Pending issues include the future status of the provident fund for current employees of the CSE. The bill stipulates that these employees will transition to the finance ministry, a point that remains to be fully clarified.
