2 weeks Ago
The director general of the Finance Ministry and the Interior Minister reassured the House internal affairs committee about recent concerns regarding the regulations for facilitating strategic development projects. During a parliamentary briefing held as part of an ongoing discussion on the new regulatory framework, officials from the finance and interior ministries proposed several modifications to address the committee’s reservations. Key concerns among committee members centred on the primary funding sources for strategic developments.
Specifically, questions were raised about whether these projects could be financed through loans or share issuance. In response, the Finance Ministry clarified that both methods—borrowing capital and issuing shares—are standard and vital sources of funding for large-scale investments. In a related memo, the Finance Ministry pointed out that the criteria for approving strategic projects, which include job creation, are set out in article 8 of the primary legislation.
Proposals were also made to add further clarifications in the revised regulations. For example, the designation of an “anchor company”—a key entity in a project—would be strictly limited according to the conditions outlined in the regulations, which aim to support and streamline complex projects. Interior Minister Constantinos Ioannou also weighed in, addressing concerns regarding the criteria of job creation and the feasibility of monitoring sustained employment.
The Interior Ministry’s correspondence to the committee clarified that the strategic development regulations set criteria for determining a project’s eligibility, including minimum investment amounts, job creation targets, or a combination of both. The regulations also give the head of the strategic development sector the authority to assess applications for projects seeking strategic status. Regarding job creation specifically, the minister highlighted its importance as a key metric for assessing a project’s impact on the economy.
He said that a strong employment component can support economic growth, reduce unemployment, and promote social cohesion, thus underscoring why this criterion should remain in the regulations. However, the minister acknowledged that there is currently no established process for verifying ongoing job creation after project approval and completion. The law specifies that the state does not provide direct subsidies for these developments but facilitates permitting processes within 12 months, with applicants paying a management fee in return.
To better address committee concerns, further amendments were proposed to make evaluation criteria and application processes clearer and more streamlined. These proposals also clarified that strategic project status and its subsequent approval or rejection are ultimately determined by the Cabinet based on available studies and evidence. The Interior Ministry also provided insights into mixed-use projects, which fall under article 3 of the regulations.
According to the ministry, the inclusion of mixed-use developments ensures that these projects benefit from single-point service, which expedites the process for developers. It was specified, however, that costs associated with secondary project uses not related to strategic sectors are excluded when assessing a project’s eligibility for strategic status. The proposed regulatory package is intended to define the criteria under which a project may qualify as a strategic development, assign project management responsibility, and specify the second instalment of the required management fee for permitting.
For the article-by-article review of the regulations, a range of officials and stakeholders were invited to participate. This included the director general of the Interior Ministry, the head of the town planning and housing department, representatives from the finance, agriculture, and commerce ministries, as well as the Tourism Deputy Ministry..
