Filenews 22 May 2022 - by Eleftheria Paizanos
At a time when the disbursement of the second tranche, amounting to €85 million, from the Recovery Fund is in the air, due to the involvement that exists between the government and the opposition parties in relation to the legislation that will contribute to the strengthening of the legal framework for the management of non-performing loans and determine the licensing and operation of loan servicing companies, 35 government grant plans are planned which will be implemented through the National Recovery Plan.
From the total amount of €1.2 billion that Cyprus will receive by 2026 from the relevant European fund, after having implemented 58 reforms and 75 investments, the grant projects that will be activated are estimated to be worth more than €380 million. At the same time, there are estimates that an additional €400 million will be mobilised from the implementation of the sponsorship plans. from private investment.
The sponsorship plans will provide investment opportunities and a series of incentives, which will help mitigate the economic and social impact of the coronavirus pandemic.
In total, six groups are the beneficiaries in the grant projects. These are individuals, households, vulnerable groups, small and medium-sized enterprises, large enterprises, local authorities, the public sector and non-governmental organisations. The sponsorship projects concern the sectors of green transition (RES, energy efficiency, circular economy, electromobility), the primary sector, manufacturing, tourism, research and innovation, as well as start-up and innovative entrepreneurship. In addition, sponsorship plans are in the areas of digital transformation, consulting services, certification, medical equipment and services, human resources, education and social cohesion.
Of the 35 sponsorship projects, 25 are expected to be announced later this year, others are already in place since last year, while around 5 projects are planned in 2023. It should be noted that the sponsorship plans are related to the five axes of the National Recovery Plan. It is recalled that the Cypriot plan has defined the axes of public health and civil protection, i.e. the transition to the green economy, the strengthening of the resilience and competitiveness of the economy, the digital transformation, employment, social protection, education and human resources.
€7.5 million will be spent on health
In the health sector, two sponsorship projects are under development.
- These are the sponsorships for the purchase and replacement of medical equipment in private hospitals, which are contracted with the Health Insurance Organization for services in the General Health Plan. The project budget is estimated at €5 million. The implementation of the plans is expected to support 23 hospitals by the fourth quarter of 2025. The maximum amount of aid per beneficiary will range from 30 to 50%, i.e. up to €200,000.
- An accreditation scheme for public and private hospitals, which will help support 45 hospitals by the end of 2025. The aid ranges from 40-70% per beneficiary, with a maximum amount of €60,000. A total amount of €2.5 million will be spent on the implementation of the project.
Generous plans for a green transition
Nine plans fall under the green transition sector (RES, energy efficiency, climate neutrality and electromobility).
- Last March, a plan was announced to promote energy efficiency investments for small and medium-sized enterprises, non-governmental organisations and other organisations, with a total budget of €40 million. The plan will support 275 entities by the end of 2025, with the aim of achieving minimum primary energy savings of 30% on average. The aid can reach up to 65%, which corresponds to €200,000.
- The plan for the promotion of RES and individual energy efficiency measures in homes, including households with vulnerable energy consumers, totalling €20 million, is under implementation. The plan will support 16,470 households (including 270 households with disabilities) by the second quarter of 2026. The aid rate is estimated from 25-75%, i.e. €1,500 to €3,750.
- Plan to encourage the use of RES and energy saving measures in local authorities and public sector bodies. The €9m plan was announced two months ago and will help support local authorities in implementing 580 investments. The financial support ranges from 75 to 100% with a maximum sponsorship amount of €100,000.
- Plan to support local communities in tackling and adapting to climate change. Through the project, grants of €3.5 million will be granted. local authorities with a maximum amount of aid of up to 80%.
- Sponsorship plan to reduce carbon dioxide (CO2) emissions to industries, businesses and organizations totalling €20 million. The first phase of the plan provides for the development of action plans, forecasts and monitoring and verification reports. The second phase includes investments and the implementation of action plans. The project is aimed at natural and legal persons engaged in an economic activity.
- Plan to install charging points in residential, publicly accessible places, businesses and local authorities. 1200 charging points are expected to be installed in publicly accessible buildings, in municipalities, businesses and housekeeping by the end of 2025. Last month, a plan was announced to implement infrastructure for charging electric vehicles from renewable energy sources, for households and local authorities. Beneficiaries are households, which will receive grants of €1 million, as well as municipalities and communities that will be subsidized with another €1 million. For both categories the aid will be from 50 -100%. Specifically, the maximum sponsorship amount for households will be €2,347 and for local authorities €250,000. The total budget is €6 million.
- Plan for the purchase of electric vehicles. The purchase of 5,750 electric vehicles will be subsidised by 2025. Implementation of the plan began last year. The aid rate is between 12 to 37.5%, i.e. from €1,000 up to €15,000. The total cost of the project is estimated at €30 million.
- The plan for the withdrawal of polluting vehicles is under implementation, combined with incentives for low- or zero-emission travel options. €15 million will be spent. to withdraw 3,150 polluting vehicles by the end of 2025, which will be replaced by electric bicycles and vehicles without or with low emissions. The plan, which is addressed to natural and legal persons, provides for the provision of annual bus transit tickets. The sponsorship ranges from €750 to €12,000.
Processors are digitised
In the primary and secondary sectors, the projects that will be offered are the following:
- Plan for genetic improvement of the ovine and caprine population. The project with a budget of €5 million will contribute to supporting 40 farmers and improving sheep and goats. The grant that each beneficiary will receive can be up to €87,760.
- A plan for the modernization and digitization of enterprises operating in the sectors of processing and trade of agricultural products at a cost of € 25 million. The project will support 176 small and medium-sized enterprises in the processing and marketing of agricultural products.
- A plan to strengthen the competitiveness of large enterprises active in the manufacturing sector. The plan, with a total budget of €7 million, will support ten large enterprises in the manufacturing sector by the second quarter of 2026.
Upgrading hotels and dining areas
Four projects concern the upgrading of the tourism sector.
- Plan for the upgrading of tourist accommodation / hotels in rural, mountainous and remote areas, for modernization and improvement of the competitiveness of the tourist product and the Cypriot agrotourism. The project with a budget of € 10 million. is addressed to hotels and tourist accommodation.
- Amount of € 8 million. will be allocated for the upgrading of traditional restaurants or sales of products for inclusion in the "Taste of Cyprus" pact. The project concerns restaurants and small and medium-sized enterprises in the field of selling traditional products.
- Plan for the creation of medical facilities and facilities for autonomous assisted living, with the aim of attracting medical tourism and health and wellness tourism. The cost of the project is estimated at €8 million. and is addressed to hotels and tourist accommodation.
It should be noted that the three projects will support 175 small and medium-sized enterprises, i.e. restaurants and sellers of traditional products by mid-2023 and 57 hotels by mid-2026. For all three projects the amount of aid reaches €200,000. The tourism sector also includes the plan for the revival of rural areas, mountainous and remote areas through the creation of "Authentic Experiences" for the enrichment of the tourism product. By the end of 2025, the plan will support 105 businesses and local authority councils.
The circular economy and innovation
Two other sponsorship projects relate to the circular economy. These are the implementation of the circular economy in 50 hotels and the certification of 18 hotels as circular. An amount of €1.4 million will be spent on the implementation of the project. Moreover, another €15 million. will be spent on supporting 40 small and medium-sized enterprises by strengthening the circular economy in industry. The maximum amount of aid per beneficiary will be €317,500. In the field of research and innovation, there are 3 sponsorship projects, two of which are on track to be implemented. These are innovation funding programmes and projects to support the growth and strengthen the competitiveness of small and medium-sized enterprises, including start-ups and innovative enterprises. By the second quarter of 2026, the plan with a budget of €52 million will be implemented by the commission. support 200 organisations involved in research and innovation activities. They will also be supported with €6 million. and 10 companies in the fields of green transition research. At the same time, an amount of €3 million. will be spent to support 16 operations to develop classified laboratories. The project will contribute to the development of graduated laboratories and communication networks in research and academic organisations.
With €22.4 million small and medium-sized enterprises will be financed
In addition, in the areas of upgrading small and medium-sized enterprises, three projects worth €22.4 million are being promoted. This is a project for consulting services to small and medium-sized enterprises. Through the plan, it is estimated that 375 companies will be supported with a maximum amount of aid of €15,000. At the same time, this is the digital upgrade sponsorship scheme for businesses, through which 290 small and medium-sized enterprises will be supported. The financial support is estimated at around €50,000 Also, 140 small and medium-sized enterprises will be supported to support the extroversion and export orientation of Cypriot businesses.
A sponsorship plan is being promoted for the creation of student dormitories in the city of Nicosia within the walls, sponsorships in relation to the certification of public and private sector organizations in the development and implementation of management systems to combat bribery and corruption, as well as a plan to upgrade the internal wiring of buildings to be "Gigabit-ready" and the promotion of connectivity.
Employment of up to 400 unemployed and pre-primary education
Projects in the field of employment are also important. Specifically, through the plan of flexible forms of work with teleworking, 400 unemployed will be employed by the third quarter of 2025. They will have to complete 12 months of work, with 30% being with the status of teleworking. The cost of the project is estimated at €4 million.
In addition, an incentive scheme is being promoted for the recruitment of 600 young people aged 15-29 out of employment, education or training. The last three projects relate to the education and care sector and foresee costs of €28 million. The projects will extend free compulsory pre-primary education from the age of four. It is estimated that 7,425 children will attend free of charge in community and private kindergartens. The creation of multipurpose centres for children and childcare is also being promoted, from which 27 local authorities and non-governmental organisations will be supported. 18 shelters will also be created for children, adolescents with behavioural disorders, people with disabilities and people in need of long-term care - Sponsorship Scheme for the creation / renovation and purchase of equipment.
