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26 May, 2024
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Golden passports scheme to remain as is

The Cyprus government decided that any move to manage the current crisis, such as the potential suspension or termination of the investment program, would only work to confirm the damning reports

Marina Economides

Marina Economides

The citizenship-by-investment program will not be terminated, nor will it be suspended for a short period as a way of managing the crisis developing crisis, the government decided during its Tuesday morning coffee at the Presidential Palace. What was strongly tabled was that a potential freezing or termination of the investment program at this point in time would send a message that the government is acting in light of the Al Jazeera publications, and that by extension, that it accepts them.

Until Monday, the President of the Republic but also members of the Cabinet were seriously considering that it might be better to suspend the investment program for a short time, as the damage caused internationally is far greater than its benefit to the Cypriot economy. What has been made clear is that since the report of the three-member committee tasked by the Cabinet with examining all exceptional naturalization cases approved between 2008-2018 is expected within days, and since a new legislative framework regulating the investment program from any abuses was voted upon in July, additional measures are not needed.

A timeline of developments

In the past few days and in the midst of the exposés, various scenarios have been on the table on how to address the issue of citizenships granted in exchange for investment, with the President of the Republic considering to suspend the program for a few months and perhaps more closely informing the Commission about the persons approved and granted a Cyprus passport. The options that were being considered were not accidental, as European Justice Commissioner Didier Reynders revealed to Al Jazeera that he is considering legal action against Cyprus over the citizenship-through-investment scheme.

Since Cyprus has taken stricter measures & given that there is no EU mechanism to put an end to the scheme, then nothing can actually be done, apart from pressure

There were also the moves of the German MEP Sven Giegold, who, as "K" revealed last Sunday, raised the issue of referring Cyprus to the European Court of Justice for violating European legislation, which raised strong concern for the President that Cyprus will once again be found in the centre of a controversy and that the program may end up being suspended by the EU. Already members of the Cabinet as well as executives of the ruling party have repeatedly expressed dissatisfaction that the program has irreparably damaged the country's reputation at a particularly difficult time. There was also the position of House President Dimitris Syllouris on Monday, who claimed that it might be best to suspend the program.


The question is what mediated that led to the renewed government fallback. In the EU there are circles that express the position that what has transpired has certainly worried Brussels, but since the Republic of Cyprus has taken stricter measures and given that there is no mechanism in Brussels to put an end to a country's investment program, then nothing can actually be done, apart from pressure.

There are also those circles that note that the pressure to stop the program or at least to faithfully implement the new stricter regulations will be done through various channels. The Presidency also seems to be relieved by Al Jazeera journalist James Kleinfeld's interview with Kathimerini Cyprus last Sunday, where he clarified that the revelations about the Cyprus Papers have been completed and that they currently have no other information about either intermediaries or directly involved politicians.

During Tuesday morning’s coffee, attended by the President of DISY Averof Neophytou, the Minister of Finance Constantinos Petrides, the Minister of Interior Nikos Nouris, the Minister of Foreign Affairs Nicos Christodoulides, the government spokesperson Kyriakos Koushios, the Deputy Minister to the President Vasilis Palmas, the head of the President’s office Petros Demetriou and the vice-president of DISY Harris Georgiades, it was decided that it preferable that no more decisions are taken on the issue at present. It was preferred to wait until the publication of the report of the three-member committee first, while a new committee will be tasked with examining all cases of naturalization from 2008 until today.

What worries the government is of course the number of problematic cases that the three-member committee will find out of the 29 that have been brought before it for examination. That is, if 25 of the 29 cases are considered problematic, then the whole issue will not be closed easily.

In comes Odysseas

And it will not be easy to close the whole issue since the Auditor General has entered the frame, who has made his readiness to carry out a sample audit of naturalization cases clear.

The Ministry of Interior has already addressed the Attorney General of the Republic, requesting an opinion on whether and what information should be given to the Auditor General, with the latter talking about a refusal to grant the files.

Lost in the leak

In any case, special emphasis has been placed on who made the leak. From the very first days, the government has given instructions to find the whistleblower, and pointed toward Parliament. And although the President of DISY, Averof Neophytou, reduced the number of deputies who may have leaked the documents to 18, the number, according to government sources, is considered higher, given the scientific collaborators and the officials working at the Cyprus Parliament. Although the police have already started investigating the matter, there is already a discussion about whether the whistleblowers are protected by an EU regulation, which should have already been followed by Cyprus, as an EU member state.

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