The Creation of a Democracy – Cyprus Development BankCypruss economy is a small, vigorous and well yielding economy that has showed its ability of adaption in upheaval conditions. Classically Cypruss economy is characterized by a steady economic pace in growth. The hard fact is that for the last 50 years, from the establishment of Cypruss Democracy in 1960, the grass was not always green, and this makes it even more special for Cyprus that nowadays, in a worldwide financial crisis keeps the country in low annual unemployment and inflation rates.
The Creation of a DemocracyThe underdeveloped economy that Cyprus inherited from several past Colonizers in 1960, switched over in a modern economy with steady headway towards all sociologic and economic sectors, with dynamic services in all entrepreneurial sections, high social constitution and successful manufacturing and farming sectors.
In 1963, Cyprus Development Bank (CDB) was set up and set the pace until today as a public company which propels the economic development in Cyprus. Cyprus Democracy and the European Development Bank are the two main shareholders. CDB primarily sponsored the hedge of a massive range in the production field of the economy, with stress in the sectors of manufacturing and long-term financial loans for new entrepreneurs (special attention had been given in the entrepreneurs capital risk and investment). From 1963 to 1974 the annual sponsored money given to several economic fields was on average £210million Cyprus pounds. (Statistics given by personal interviews of the assistant secretary of the Exchequer).
The Cyprus economy was largely carried out by private capital, and the government was required to fund the development and support of this capital expenditure. The central bank was directed to allocate a part of the budget to financing its own investment in the economy which was used in the initial stage. On the last day of July 1969, Cyprus government representatives agreed to create a special bank (BIB) which would lend to government enterprises. Cyprus Development Bank, which was established on the 15th September 1970, was to be divided between the BII (Government of Cyprus) and the central bank (BIB).
The Cypriot government was able to purchase all the equipment that the government was needed for the production of the new economy in order to maintain the capital supply. As it had been planned in 1973, the Cypriot government had the means to produce the basic goods: clothing, shoes, iron, copper, and gold for the various types of public sector banks.
The Cypriot government in particular chose to invest in the infrastructure to provide for the growing economy, which was especially important to Cyprus during a time of uncertainty about the economic crisis in Cyprus. The most important project of support for the economy was a new electric power plant called J-Pentral (Electricis) in early 1974 which produced 850 MW of electricity a day. The plant was planned to generate 6,400 W per year which the Cypriot government had promised when the economic disaster began on 22 July 1974.
The Cypriot government set up the CDBM in 1972. It had its main assets under public supervision and it had funds for capital of 1 million Cypriots at an average interest rate of 1.6 per cent. The capital was divided among six private banks of Cypriots, three of which were based in Cyprus. The third were called Cypriot Central Bank and one of them were called Cypriot National Bank which were affiliated to the central bank. The remaining five were based out of Cyprus.
The Cypriot government then set about to raise funds in the process of securing the credit which was needed for the growing economy. The Cypriot government was able to do this by introducing and increasing the level of the central deposit rate. The CDBM in the next year established the Cypriot banking system and the Cypriot People’s Bank. The Cypriot People’s Bank was to create 710 private banks who would meet the needs of the large public sector banks that currently own about 120 million Cypriots. These enterprises would become the banks of Cyprus.
The central bank (BIB) was also created. During the first few years of the crisis Cyprus government funded a total of 2.3 billion Cypriot bank accounts which were based abroad. During these two years the Cypriot government had invested about 1 billion Cy
The Cyprus economy was largely carried out by private capital, and the government was required to fund the development and support of this capital expenditure. The central bank was directed to allocate a part of the budget to financing its own investment in the economy which was used in the initial stage. On the last day of July 1969, Cyprus government representatives agreed to create a special bank (BIB) which would lend to government enterprises. Cyprus Development Bank, which was established on the 15th September 1970, was to be divided between the BII (Government of Cyprus) and the central bank (BIB).
The Cypriot government was able to purchase all the equipment that the government was needed for the production of the new economy in order to maintain the capital supply. As it had been planned in 1973, the Cypriot government had the means to produce the basic goods: clothing, shoes, iron, copper, and gold for the various types of public sector banks.
The Cypriot government in particular chose to invest in the infrastructure to provide for the growing economy, which was especially important to Cyprus during a time of uncertainty about the economic crisis in Cyprus. The most important project of support for the economy was a new electric power plant called J-Pentral (Electricis) in early 1974 which produced 850 MW of electricity a day. The plant was planned to generate 6,400 W per year which the Cypriot government had promised when the economic disaster began on 22 July 1974.
The Cypriot government set up the CDBM in 1972. It had its main assets under public supervision and it had funds for capital of 1 million Cypriots at an average interest rate of 1.6 per cent. The capital was divided among six private banks of Cypriots, three of which were based in Cyprus. The third were called Cypriot Central Bank and one of them were called Cypriot National Bank which were affiliated to the central bank. The remaining five were based out of Cyprus.
The Cypriot government then set about to raise funds in the process of securing the credit which was needed for the growing economy. The Cypriot government was able to do this by introducing and increasing the level of the central deposit rate. The CDBM in the next year established the Cypriot banking system and the Cypriot People’s Bank. The Cypriot People’s Bank was to create 710 private banks who would meet the needs of the large public sector banks that currently own about 120 million Cypriots. These enterprises would become the banks of Cyprus.
The central bank (BIB) was also created. During the first few years of the crisis Cyprus government funded a total of 2.3 billion Cypriot bank accounts which were based abroad. During these two years the Cypriot government had invested about 1 billion Cy
The black yearThe first positive investment feedbacks start to rise in the late 60s where tourism had a determinative role for the whole economy. For 5 years (1969-1974) Cyprus was established as a main tourist attraction centre in the whole Mediterranean. But this did not last for long, in July 1974 after the first Turkish onslaught and later, in August 1974 with a second invasion the Turkish army “blows over” everything. They pillaged the Cyprus Democracy while they still held in violation of the law around 37% of the Island. 70% of the islands rich producing resources were lost; the tourist industry lost 65% of its hotels and tourist accommodation, and the industrial sector lost 46%, and mining and quarrying lost 56% of production. The port of Famagusta that had been lost, handled 83% of the general cargo while the remaining 17% was handled by Kyrenia Port, which was lost as well. The closure of the Nicosia International Airport (the only airport by that time) in the buffer zone cost a lot to Cyprus which through one night, found its self cut off from the whole world. Just after 14 years of liberty Cyprus became a hostage of a non prior economic doubt. (Statistics by CCCI, CDB, Fileletheros newspaper journals, Wikipedia).
A new startAlthough