# Brain meltdown?



## Baywatch (Mar 30, 2014)

This only shows you never know what will happen in future

AKEL will fight privatisations until the end - Cyprus Mail Cyprus Mail


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## Veronica (Apr 5, 2008)

It isn't possible to have brain meltdown if you don't have a brain


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## PeteandSylv (Sep 24, 2008)

But has anyone shown why the privatisation is desirable? It is automatically assumed that it would lead to more efficiency, higher profits and lower prices but I would like to see this explained for a small country with such a small population.

To put it into perspective the electricity company and phone company are tiny compared to the suppliers in London alone. I cannot speak for the ports authority.

There are other alternatives such as sub-contracting the entire businesses or importing high expertise management as possibilities.

However whatever the outcome of how these businesses are run it will be an uphill struggle while the unions continue to have a stranglehold. This condition alone makes me wonder who the businesses could be privatised to. If the intention is to privatise just by issuing shares and retaining the same management then I wonder how any benefits will ensue or even if the share issue will be taken up satisfactorily.

Pete


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## Baywatch (Mar 30, 2014)

PeteandSylv said:


> But has anyone shown why the privatisation is desirable? It is automatically assumed that it would lead to more efficiency, higher profits and lower prices but I would like to see this explained for a small country with such a small population.
> 
> To put it into perspective the electricity company and phone company are tiny compared to the suppliers in London alone. I cannot speak for the ports authority.
> 
> ...


Ofc a privatization with kept management and number of staff will not be possible, no one is interested. But still there are interest. And for the unions, a private foreign company don't have ties to the unions. Hellenic bank has already proven, that when it got foreign owners it dared to take on the unions with success.

There is still a lot to do in the power market. Solar for one. Cyprus could easily produce enough power 10 months per year via solar. The rest, use the oil/gas turbines.
2011 I got involved in a project to build a couple of mWatt solar plants in Cyprus. The investors are German solar companies with very long experience. The project investment was about 30 million €. The investors are still interested but EAC refuse to give any licence. They are only interested in Net metering, not to buy power from external companies. The new government program is also only net metering even if the allowed production has increased and also companies can use the system

Cyta is in my opinion another problem. According to the news the government want to keep control over the network and sell the rest. That is the wired network. The network is where the biggest investments is needed. And it is a quite small customer stock. Not even the extra 180000 in the north will help much. And there is another complication. The mobile traffic in the north is 100% controlled by Turkcell, and I doubt that they want to give that up easily

(moderated)


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## David_&_Letitia (Jul 8, 2012)

PeteandSylv said:


> But has anyone shown why the privatisation is desirable? It is automatically assumed that it would lead to more efficiency, higher profits and lower prices but I would like to see this explained for a small country with such a small population.
> 
> To put it into perspective the electricity company and phone company are tiny compared to the suppliers in London alone. I cannot speak for the ports authority.
> 
> ...


I agree with Pete on this one. 

Both privatisation and nationalisation are political ideologies (capitalist and socialist respectively). Consequently, and as each has its pros and cons, it should be up to democratically elected governments to decide the way ahead in accordance with normal rules of sovereignty. However, when you have been bailed out to the extent Cyprus has been, the Creditors (EU) may call the tune to ensure that they get their money back. This is unfortunate (to say the least) because one size rarely fits all, and what works in Germany, France or UK may not necessarily work in Cyprus.

In the UK, for example, I agreed with the privatisation of most commercial businesses (British Coal, British Steel and British Leyland), although in each of these cases, the business failed after privatisation due to not being competitive in a global market. One only needs to look at our railways now to see what a mess has been made since privatising British Rail. British Telecom and British Gas are (with reservations) more of a success story.

However, I disagree with the privatisation of essential services like water and electricity. These services, since privatisation, relentlessly pursue profits above customer service. Shamefully, a large proportion these excessive profits are being invested in other areas rather than in improving services of their own industry.

As far as Cyprus is concerned, I will be glad to see the privatisation of a company like Cyta. Many of their workers seem to believe that that they are doing us all a favour by deigning to even serve us! The other competitors like Primetel, which are doing well, deserve an even playing field and we will all benefit in the end. 

I see no particular reason to privatise AEK as the service is good, and there would be little scope for competition in such a small market. I suspect that if privatised, AEK would be snapped up and controlled by a single foreign based power company which would have profits at the heart of their investment and we would see increased prices with no increase in investment or service.

I have no particular view on the Port Authority, but suspect that it would thrive under one of the alternatives proposed by Pete. 

The unions clearly have a stranglehold here, and the sabre rattling will probably be ended when the workers are given shares in any company which is privatised. Money talks.


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## Veronica (Apr 5, 2008)

Whatever the outcome of privatisation plans, the biggest problem is the unions and until they see sense and realise that their bully boy tactics only make matters worse making any real headway is not going to be easy.

Employees of government controlled companies, teachers, and other government employees have for far too long got away with sitting around drinking coffee, reading the papers resulting in backlogs in their work while they are overpaid, rude and lazy.

Troika insist on things being sorted out and if the unions continue to be stubborn it could result in much needed EU money being withheld which will slow down the recovery of the Cyprus economy.


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## PeteandSylv (Sep 24, 2008)

The position with privatising the electricity authority has now changed substantially.

EAC to stay in state hands - Cyprus Mail Cyprus Mail

Only time will tell if this is a good decision however I am concerned that the union will take this as their victory and thus feel strengthened which I truly believe to be against the interests of Cyprus.

Pete


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## David_&_Letitia (Jul 8, 2012)

PeteandSylv said:


> The position with privatising the electricity authority has now changed substantially.
> 
> EAC to stay in state hands - Cyprus Mail Cyprus Mail
> 
> ...


The pressure begins...

Unions to escalate action as cabinet decides on EAC break-up - Cyprus Business Mail


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## Hudswell (May 14, 2010)

I was never convinced in regard to the privitisation of the EAC, the ports and telecoms are a different matter. Cyprus is just to small and if privatised I would think a single "provider" would get it anyway and negate any benifit to the consumer. I suspect the Trokia are not overly happy with this plan but on the surface are happy to go with it....the Government just have to have the guts to carry it through...Cypriot unions are locked in the 60's, they need to get on side...the side of the consumer, or be broken.....


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