Massive Shortfall in Financial Resources

North Cyprus News - Minister of Finance - Olgun Amcaoglu
Finance Minister – Olgun Amcaoğlu

Minister of Finance Olgun Amcaoğlu has said  that the government has discussed with Turkey both the financial difficulties they face due to the coronavirus pandemic and the issue of the new financial protocol. He said that the TRNC would need 300 million TL by the end of the year.

Amcaoğlu stressed that if they did not have support from Turkey, they would not be able to cope with this critical period. He added that his ministry was in constant consultation with the Turkish delegation, with which they were constantly discussing both the situation created by the emergence and spread of the pandemic and the needs of the TRNC. “As for the fiscal protocol for 2020, the amount that will be allocated for investments in infrastructure projects, in the real sector of the economy, in public finances and in defense, has been determined. We are waiting for their response these days,” he said.

Recalling that Turkey has experienced similar difficulties with them in terms of combating the spread of the pandemic, Amcaoğlu said that nevertheless, Turkey has been and will always be by their side and will support them. “There is a setback in fiscal resources, which is a shortfall of  57%. In order to overcome this difficulty, of course, we need support from Turkey. By the end of the year we need about 300 million TL. If this situation continues, there will be internal borrowing, but resources will also come from Turkey,” he said.

Explaining that the TRNC has no liquidity reserves in either gold or oil, Amcaoğlu recalled that the only sources of liquidity for the state are the various funds it has, as well as the resources sent by it. Turkey. He added that the state’s revenue for March amounted to 945 million TL. For May, Amcaoğlu expressed concern that, as he said, there would be a big setback in both state revenues and taxes.

On the issue of paying salaries in North Cyprus for the month of May, Amcaoğlu said that at the moment they are not considering borrowing internally but spoke about the possibility of borrowing internally to meet the needs in the health, education and highways sectors. He said, however, that they were still in the process of discussing how the loan would be made.

North Cyprus News - North Cyprus Tourism logoRegarding the tourism and higher education sectors in North Cyprus, the finance minister said that the loss of revenue from those sectors that currently cannot be reopened is $ 2 billion. He also explained that the revenue from these sectors has been used, to date, to cover the foreign trade deficit, which is now impossible to do.

Amcaoğlu went on to say that the effects of the crisis created by the pandemic are not limited to the economy and trade, but also extend to people’s daily lives. “It is for this that we are obliged to set the conditions for turning this crisis into an opportunity,” Amcaoğlu said, stressing that with good planning in the field of tourism and higher education, they must explain to the international community their notable success on the fight against the Covid-19 pandemic.


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