Non-governmental organizations reunited as pertaining to the issue on the current legislative activities for the Law on Interest and the Debt Restructuring Law.

Lawyers working on both laws also attended the meeting, which was held yesterday morning at the Şevket Abohorlu Meeting Hall, located in the head office of the Cyprus Turkish Building Contractors Association (CTBCA).

The lawyers gave detailed information about their work, and a report was read, which was based on their research and analysis of the relevant examples of European and international laws in question.

Citing the urgency of both the Interest Law and the Debt Restructuring Law, the meeting reached a consensus on the need for speeding up the legislative work.

The topical issue for the non-governmental organizations is the interest law and restructuring of debts to banks. Cyprus Turkish Chamber of Tradesmen and Craftsmen (KTEZO), Cyprus Turkish Building Contractors Association (CTBCA), Cyprus Turkish Public Vehicle Operators Association (KAR-İŞ), Chamber of Civil Engineers, Rental Vehicle Operators Association (KAİB), Cyprus Turkish Chambers of Engineers and Architects (KTMMOB), Restaurants Association (RES-BİR), Cyprus Turkish Electricity Contractors Association (KTEMB), United Taxi Drivers Association, Interest and Warrant Victims Committee, Cyprus Turkish Building Subcontractors Association, held a meeting about the Interest Law and the restructuring of bank debts and debts to the state at the Cyprus Turkish Chamber of Industry at 12:00 yesterday.

Two representatives from each organization attended the meeting held within the framework of Covid-19 measures. CTBCA President Cafer Gürcafer and KTEZO Coordinator Hürrem Tulga made the opening speeches for the meeting. The agenda for the meeting was the restructuring debts to banks, enacting the interest law and restructuring debts to the state; It was decided to form a team of lawyers and to start technical studies without delay.

“The first phase for the opening of the economy is the vaccination, the second is the restructuring of depts”

President of the Cyprus Turkish Building Contractors Association (CTBCA), stated that the first leg for the opening of the economy is the vaccination and the second leg is the restructuring of the debts.

Expressing that the countries injured by the pandemic have already started work to raise their economies, Gürcafer said “We are in a boat entrusted to God, with no paddle, and we are blown away”. Gürcafer noted that at the current juncture, an Interest Law and Debt Restructuring Law are most needed immediately.

CTBCA President Cafer Gürcafer said: ‘’All organizations have been striving for the same goal for a while. Everyone is trying to save their own business. At the same time, they are doing something to save their country. All efforts are concentrated around this. Of course, we experienced a process that the world could not foresee or predict. At the end of this process, yes, there has been an earthquake caused by the pandemic and an economic collapse caused by that earthquake.  But at the point reached, with the discovery of the vaccine, the world began to think and organize the rebuild, getting up slowly, compensating for the damage it suffered.’’

He continued, ‘’The whole world is like; ‘we have found the vaccine, how will we get vaccinated, at which point will our country take its place in the global economy after it is vaccinated, which sectors will we bring to the fore, how will we treat the injured economy, how will we get a share from this cake’, so it began to act in a very conscious and very organized manner. During this period, our country’s resources were not used as they should have been. We said, ‘Let’s use the resources of the country as accurately as possible, because this war will not end early, it will last at least for 2 years.’

Despite this warning, what saved the rulers was to create a perception, convince people that this thing would end in 2-3 months. People were made to believe.”

“It has not suited them”

CTBCA President Cafer Gürcafer said that the resources were used pretty ruthlessly and he noted that at one point there was a fiscal structure in panic, which did not know what it was doing.

Gürcafer, continued as follows: “We have a state structure that concentrates only on its own expenses, namely the salaries of public service employees and retirees. In addition, there is the wheels of the economy that will need to start spinning once the vaccination is done.  We will return to normal life around July-August-September, if we do not make the correct calculations from today and take the right step for the real economy, when the doors are opened in four months’ time, none of them will care about how deep our wound is.  They will say, ‘The deceased are dead, we will continue with the rest’, they will say, ‘the free market cures itself.’ How it cures is; one goes bankrupt, the other with foreclosure picks up the business and carries on. This is not the approach that is becoming of a State. The correct state approach is to protect every one of its individuals wounded by the war. This will be the approach the whole world will take. Imagine that all over the country every  individual was harmed and shattered, but the banking sector made a profit. That is not acceptable.”

“Introducing a Restructuring Law without also introducing an Interest Law does not make much sense”

Cafer Gürcafer, saying that there is only one method for getting back on your feet, went on to add, “A business needs a certain business loan on the day life returns to normal so it can conduct its business. You, the State, will do this. Second, you will reveal the repayment instalments from the income that would be earned, and for this, you as the state will adjust the interest rate needed. You will do this by law. Otherwise, all businesses will go bankrupt.”

CTBCA President Gürcafer expressed that another important deficiency in the country is the absence of an Interest Law. Gürcafer, completed his speech as follows: “There is a decision of the High Administrative Court. It orders the government and says ‘You have to pass the Interest Law’. If we do not do this work within a certain system, if we do not do this and if we only complain, all sectors will experience foreclosures. Introducing a Restructuring Law without also introducing an Interest Law does not make much sense.”

Postponement is one of the biggest threats that await us. Settle now if you can afford it.

Turkish Cypriot Chamber of Tradesmen and Craftsmen (KTEZO) Coordinator Hürrem Tulga noted that the state never relinquishes what is owed to it and enforces the penalty system in a case when payment is not received on time, and noted that the law on the restructuring of debts should be made together with the Interest Law.

Tulga, who also made important statements about the postponement of debts, said:

“The monthly instalment of a loan of 150 thousand TL with 60 months maturity and 20 percent interest is 4 thousand TL. When payments are delayed for 6 months, it goes up to 4780. So, the Parliament and the banker are saying; ‘you will pay more’ under these conditions where the economy’s wheels have halted and the capacity has decreased. Can life endure this? Can the business survive at that point? In fact, this is not an issue that requires as many billions as it is claimed in the parliament. The whole point is that the money is squandered without any foresight.

Only a 2.50 percent contribution to the 20 percent interest rate maintains the same instalment rate. In other words, you pay the same instalment amount despite the postponement. You will not create this resource, you will move it on and you will say it is the ‘free market’. Even though you have stopped life, you will not take any responsibility. Is this possible? There is a lot to be done, that can be done. If a resource cannot be created via both banks and the state, a collapse will ensue. In an eventuality where we are late, we will not even get a chance to start again. We are not looking to save ourselves. We are seeking justice. What I’m trying to say is not begging at this point. In other words, the issue referred to as the postponement is one of the biggest threats that await us. If you have even 3 pennies, then continue to pay.”

NUREL: All public receivables should be restructured at the same time

Redif Nurel, Vice President of the Association of Rental Car Operators (KAİB), stated that all public receivables should be structured in conjunction with the Interest Law. He stated, “If the debts are postponed even for 1 year with 2.50 percent interest contribution, the instalments remain almost the same. More is needed. Another problem is the issue of debt to the state. We have no income due to the pandemic, but the road tax and all other dues and claims of the state continue to be processed. We have been consuming our equity for one year, we provide money so that the state collects public receivables, we give money to banks, but we have had enough. We have to say stop at some stage. With the interest law, all public receivables should be restructured at the same time and discounts should be applied for everyone.”

DOĞRUYOL: The interest law and law for the restructuring of depts should be enacted before any delay.

Adnan Doğruyol, member of the Board of Directors of the Cyprus Turkish Association of Public Vehicle Operators (KAR-İŞ), said, “Vaccination must be immediate. The Interest Law and the Debt Restructuring Law must be enacted.” Noting that the current interest rates are not sustainable, Doğruyol said: “We took action and strikes many times. We stated that we had no income and demanded no road tax, operating permits and vehicle inspection fees. We didn’t want much. Although we did not get a single penny from the state, they demanded all our obligations from us. We whom have entrusted their most precious assets to their children; they have condemned us to starvation. Vaccination should start immediately. The Law on Interest and the Debt Restructuring Law should be enacted. These interest rates are not sustainable.  We cannot put bread on the table as we have run out of money. We are for all that makes sense.”

KARALAR: Action should be undertaken immediately

The head of the Taxi Drivers Association, Murat Karalar, said that the Law on Interest and Debt Restructuring Law should be enacted without wasting time. Karalar stated that they will not hesitate to contribute to any activity needed to develop the laws.

MİMİ: The problem is a problem for all of us, we should be as one.

Turgay Mimi, Secretary General of the Cyprus Turkish Chamber of Tradesmen and Craftsmen (KTEZO), made a proposal for civil action and disobedience. Mimi, declared that “The problem is our problem. We can stop the state, our government only through a court of law. We have to pull together in this direction. Perhaps we should take a decision for civil disobedience regarding the taxes we have to pay to the state. If I do it alone, I am committing a crime, but if we act together, it creates an element of pressure. We should act in swiftly.’’

ANT: A few banks and loan sharks have taken over the country

Kazım Ant, Chairman of the Interest and Warrant Victims Committee, reminded that a restructuring law had been made three times in the past and that the Interest Law is now essential in the country. Ant said: “An Interest Law is essential now in this country. It is as if we are a land without owners. A few banks and loan sharks have taken over the country. Believe me, these banks are mortgaging future generations. What needs to be done is clear. Beginning of the pandemic period should be considered as the non-performing loan date, that amount should be postponed for two years and structured with a reasonable amount of repayment. There is no other way. The problem cannot be solved with merely dressing the wound. ”

KAYIM: We are ready to make any kind of contribution

Restaurateurs Association (RES-BİR) President Salih Kayım pointed out the necessity and urgency of the Interest Law and the Debt Restructuring Law and stated that they are ready to make any kind of contribute to this issue. Kayım said, “We say ‘yes’ to the execution of work for both laws. We are ready to assign our Association’s lawyer to take part in this undertaking.”

SERDAROĞLU: The planning of the Interest Law should be done together

Yakup Serdaroğlu, President of the Association of Rental Vehicle Operators (KAİB), stated that the Interest Law should be planned in earnest and the necessary work should be done without delay.

Serdaroğlu said: Our industry works seasonally. We closed the season in November 2019, and we could not open again due to the pandemic. We made all our investments at the beginning of March, we got into debt, and the pandemic has cut us up. We have finished all that we had. We started to eat into our capital. We are on a road to nowhere. The state must decide. Does it want to bring the country’s economy to a sustainable structure and to invest in the country? What we see is; there is no activity on these issues. This cannot be done with a postponement or merely applying dressing to the wound. We must plan the interest law seriously and together. If we keep fluctuating like this, we’ll end up in defeat.”

AMCA: We need to develop laws in earnest.

The President of the Cyprus Turkish Construction Subcontractors Association, Osman Amca, stated that they are ready to contribute within the framework of action being undertaken to establish the Interest Law and the Debt Restructuring Law. Amca said, “We’ve tried palliative solutions, but we see what the government is. We have to develop laws in earnest and we are ready to make any kind of contributions at this juncture.”

AYSAL: We must move fast

Seran Aysal, President of the Association of Cyprus Turkish Chambers of Architects and Engineers (KTMMOB), stated that all organizations agree on the importance of the Interest Law and the Debt Restructuring Law and stated that all pertinent action should be carried out promptly.

Cafer Gürcafer, President of the Cyprus Turkish Building Contractors Association (CTBCA), evaluated the effects of the pandemic on the country’s economy in general, and in particular, the construction sector.

Noting that there is a need for a socio-economic development plan based on science in the country, Gürcafer said that the Law on Interest and the law intended for restructuring of debts to the state and banks should be enacted.

CTBCA President Gürcafer made highly significant statements by taking part in the show, Parapolitik, broadcast on Cyprus TV.

“There is serious level of excess stock in construction”

KTİMB President Cafer Gürcafer said that construction has continued since the day the pandemic began in the TRNC, except for the period during the lockdown, and that there is currently a serious level of excess stock.

Saying “We are at the point of marketing now”, Gürcafer noted that there is no action in this regard yet. Gürcafer said, “We are currently focused on not missing out on the 2021 season. We are doing whatever we need to do in order to not lose the season.”

Based on a question from the program’s presenter Ali Çatal, Gürcafer asserted that Turkey is a large-scale country with a lack of planning in many sectors, he noted that a housing sector based on a supply-demand balance was also absent.

Cafer Gürcafer stated that construction is carried out within a framework of a supply and demand balance in the TRNC, and that there are on average a 10 thousand dwellings being built per year in the country, 5 thousand of which are based on the demand arising from the need for housing in the domestic market, another 2 thousand relate to the repatriating Turkish Cypriots living abroad. Stating that 2-3 thousand dwellings per year are the ones bought by foreigners for retirement and vacation purposes, Gürcafer said, “The number of houses built per year would have been towards meeting this overall demand. When the pandemic suddenly broke out, this year’s projects and the projects planned for the year next merged and thus the excess stock emerged,” he said.

Cafer Gürcafer said, “If the building work for those dwellings stops midway, it will turn into a disaster both in terms of employment and loss of national wealth.”

“Creating our development plans is a must”

CTBCA President Cafer Gürcafer stated that after the steep drop in 2007, the Anan Plan period and the sharp crash after the Orams Case, the construction sector was considerably more experienced, and that the sector met this crisis in a much more calm and organized manner.

Gürcafer stated that during the pandemic, there has been anxiety and cash shortages in the sector, but no bankruptcies occurred.

Gürcafer said, “Of course, here is the thing; the season is about to start but we do not have development plans in our country. For example, if you declare tomorrow; ‘I am building 10 thousand houses here’, there is no law that prevents you from doing so. Therefore, we need to create our development plans, determine our housing strategy and plan where these houses will be built regionally, as per that housing strategy.”

Gürcafer stated that, “We need to plan for a balance of supply and demand and harmonize that plan with nature and the economy”, and continued as follows:

“We have to build our housing structure accordingly. This is the self-criticism of a shortcoming. Generally, the country has had no development plans. By developing this planning; a top-down national physical plan, zoning plans in accordance with this national physical plan, economic policies in keeping with these zoning plans… this goes on and on. There is a danger as we do not have this, and this danger could give birth to a supply and demand imbalance. However, because we are institutionalised and organized, we are guiding this process for the better as much as possible despite this deficiency and gap. But this must be put on a legal basis. ”

“Stability Matters”

Cafer Gürcafer emphasized that one of the major problems faced by the building sector is the instability which is due to a lack of continuity of the governments.

Gürcafer said, “The government changes just at the stage of realizing a project. We have to start from scratch and one way or another we cannot conclude our projects,” he said.

Stating that the purchasing power of people has decreased significantly with the increase in the value of the foreign currency, Gürcafer said, “Yet there is an alternative. Either you will increase the purchasing power of our people, that is to say; If he receives 10 thousand TL, you will give the civil servant 10-12 thousand TL. We cannot do this. In that case you will have to build housing according to people’s purchasing power. So, you will need to lower the housing costs. There is a way to do this. Solely for social housing purposes, there are methods that will reduce the cost, make it cheaper and simplify it for the people who will buy their first home. You can do this by employing such methods without negatively impacting the build-and-sell sector, which contributes to the country’s economy significantly. This could be done without abusing it. The Housing Authority as an organization emerged for urban transformation in Turkey, but became the largest building contractor over time. Many companies went bankrupt because of this. It should not be that way either.’’

Gürcafer continued his words as follows:

“Conditions are very different in Turkey. Slums in Turkey were a bleeding wound anyway, and no other method to resolve the problem was likely other than it being done by the State whereas it was not possible for us to have the same. Nevertheless, we also know that a model can be developed in which the state and CTBCA can collaborate in order to meet the housing needs of our people while not negatively affecting the build-and-sell sector.

We shared this with all the governments, but the problem is that the government changes just as you are getting somewhere. You then have to explain this to the new government as well. The incoming one takes its seat in an anxious state anyway. While there is that anxiety caused by the fear of making a mistake, the congress gets on the agenda, the election appears on the agenda, to be dismissed or not to dismissed from office, the situation about whether the cabinet changes or not arises, and the realization of such ideas is left to another spring. Of course, this cannot go on like this. Of course, with the distress caused by the pandemic, discussions around the need to question the system has started in the country. We will consider all of them in a holistic way.”

“In some areas, there is a need for a legislative, executive touch”

CTBCA President Cafer Gürcafer stated that the association has approximately 40 employees and that it is an institution with an expert in every topic, and that all studies undertaken by CTBCA are scientific.

Stating that, “Our association has a lawyer, architect, engineer, city planner, economist, financier and experts in many other fields. Therefore, studies of CTBCA are very scientific studies,” Gürcafer went on to say, “We do not undertake these studies for ourselves either. We know the structure of our state. If the structure is problematic, you cannot progress by constantly criticizing it, and you also have to help. Therefore, we prepare these studies and share them with every outfit that comes to govern the country. But we cannot bring these things to life alone. In some areas, there is a need for a legislative, executive touch.”

CTBCA President Cafer Gürcafer said, “For example, the impact of the land cost per dwelling is 10-15 thousand pounds. If the state grants this land, a dwelling price of 60 thousand pounds automatically drops to 45 thousand pounds. Construction materials take a 20 percent effect from customs duties upon entry to the country and when you reduce that, the cost decreases to 30, 28. You can bring that down further when you provide some support from the Interest Rate Difference Fund, but these will not happen without a Council of Ministers decision and legal rearrangement.

“The main objective should be to get a community that has come out of a war back on its feet”

CTBCA President Gürcafer also noted that the Law on Interest and the law for the restructuring of debts to the state and banks should be introduced.

Gürcafer said: “Actually, this Law on Interest has been ready for many years, but it could not be introduced into law. Today, we came together as the organizations of the real economic sectors. 90 percent of this country will stand behind this Law on Interest and will stand behind the restructuring law. This law will be prepared on a scientific basis together with economists and bankers. It will be a law that will benefit the banking sector and our economy and save all businesses. The main objective should not be to make exorbitant profits but to get a community that has come out of a war back on its feet.”