Marios Konstantinou: We must do everything possible to protect our Halloumi exports

The urgent need to settle all outstanding issues that still exist for Protected Denomination of Origin (PDO) Halloumi, has been emphasised by the Managing Director of Charalambides Christis Ltd, and chairman of the Cyprus Cheesemakers' Association, Marios Konstantinou.

He has also talked about what is at stake when it comes to Halloumi and how it could have a catalytic effect on the development of our export sector.

Speaking to InBusinessNews as part of its IN Business Forecasting 2024 series, Konstantinou indicated that the dairy industry of Cyprus is based on the export of Halloumi and therefore everything possible should be done to preserve the amount and volume of exports, calling on everyone to realise that expanding Halloumi exports is more than just a commercial venture.

“On the contrary,” he emphasised, "it represents a national strategy, which is vital for our economic development, international recognition and maintaining our export activity".

As Marios Konstantinou warns, any wrong actions that will result in the reduction of Halloumi exports in volume will cause a chain reaction of problems in the sector with reductions in jobs, incalculable damages through the spoilage of raw milk and a disruption of the agricultural sector that deals with the livestock, whether at the level of raw milk production or animal feeding and raising.

Referring more generally to the course of the sector, Konstantinou expressed the assessment that the year ahead will be stable with an upward trend. However, how strong the growth trend will be will be largely determined by the international environment, which, he noted, is unpredictable and fluid.

With regard to Charalambides Christis in particular, he stated that the goal is to maintain its leadership position in the sector, while pursuing an active development course, with a particular emphasis on vigilance and stable awareness of evolving purchasing conditions.

How do you see the economic environment shaping up in 2024, in light of inflationary pressures, high interest rates and unpredictable ever-changing geopolitical developments?

If we focus on our country, we observe a slowdown, greater than what we initially expected, but significantly less than that which has occurred in the rest of the EU countries.

We are experiencing a prolonged uncertainty which, combined with the increase in interest rates, creates a noticeable disturbance in economic activities. With the September figures, in the eurozone, real GDP growth went from 3.5% in 2022 to just 1.1% for the first quarter of the current year and to 0.6% in the second quarter.

We should emphasise that so far with such a turbulent scene, our endurance and our reactions have worked well. In the first half of the year, growth in Cyprus was at 3.2%, recording an excellent performance at a pan-European level, while in the second quarter it has moved to 2.3%. We believe we are able to maintain a relatively strong financial profile.

However, at least according to the latest indications, there is a lively expectation for a reduction in interest rates in the first half of 2024. Evidence of a decrease in inflation is expected in the Eurozone and in the US, while just in November, stocks closed with a monthly increase of 6.5%, distinctly the largest since last January.

For Cyprus, let's say, Eurostat estimates put inflation at 2.5% before the end of the year.

How to maintain the strength of our economy

What do you consider to be the biggest and most difficult challenges that the Cypriot economy will have to face?

Given the extreme uncertainty created on the one hand by the ongoing conflict on the Ukrainian-Russian front and on the other hand by the conflagration in the Middle East, the first challenge is to maintain the strength that the Cypriot economy has shown so far, but also to protect our geographical position.

The uncertain conditions created by the crises always offer an opportunity to readjust economic policies, aimed at rationalising and expanding the economic activities of Cyprus in more sectors, beyond tourism and the provision of services.

Any opportunity always requires our flexibility and adaptability. This means that the main challenge is the further safeguarding of our economy and the strengthening of its capacities.

This goal includes managing rising inflation, addressing inflationary interest rates, stabilising the banking system, adapting to technological change, and of course enhancing environmental sustainability.

An important indicator for the economic health of Cyprus

Would you say that, taking into account the latest upgrades, the economy of Cyprusis now well on its way to growth?

Undoubtedly, the upgrade of the Cypriot economy - and in fact double - by Moody's is a great success for our country and is an important indicator for the economic health and prospects of Cyprus.

It is now up to us to properly manage and utilise the upgrade so that it "consolidates" and proves to be fruitful and productive, i.e. to make Cyprus even more attractive for long-term investments, investments that are consistent with new technologies, the circular economy, green and blue growth.

As we have said many times, Cyprus as a member of the hard core of the European Union with its geographical position, can really play an extremely important role as a "crossroads" as well as the base of many international businesses, highlighting the possibilities for taking advantage of new opportunities that are opened in the context of its development course.

Reactions and the settlement of Halloumi backlogs

What do you think will be the course of the sector in which you operate in 2024?

I estimate that we will - as a sector - have a stable year with an upward trend, however how strong the growth trend will be will be largely determined by the international environment, which as we see, is unpredictable and fluid.

The core characteristics, strengths of our industry have not changed, as we have always been a sector dependent on the high nutritional value of our products, combined with the taste satisfaction we offer.

So, the course in 2024 will be determined by our own vigilance and our responses. But at this point I should recall the urgent need to settle all the outstanding issues that still exist for Halloumi, our PDO Halloumi.

What are the biggest industry trends/changes you anticipate in 2024?

With 2024 ahead of us, we are getting closer to the 2030 milestone by which we should have implemented our ESG goals, i.e. reach 100% recyclable packaging for all the products we produce and reduce carbon emissions to 55% and to zero by 2050.

This challenge does not only concern us at Charalambides Christis, but the entire sector if it wants to evolve and play a leading role in the future. We are in an era of rapid developments at all levels and across the entire business spectrum and we must - urgently - adapt.

In a more general context, I can confirm that despite the strong trends that exist in the consumption of substitutes for dairy products, the consumption in the main sub-categories, such as fresh milk and yogurt, remain at very high levels and their use is constantly increasing at various moments of consumption within in the day.

National strategy to expand Halloumi exports

What are the most important problems that are currently plaguing your sector and the solution of which is considered by you to be a priority in view of the new year?

At the moment, there Halloumi is involved in what it at stake for and what is catalysing the growth of our export sector.

We must all understand that the expansion of Halloumi exports is not just a commercial venture, but constitutes a national strategy, which is vital for our economic development, international recognition and the maintenance of our export activity.

There are proposals from us, at a collective sectoral level, and they must be implemented urgently. The dairy industry of Cyprus is based on the export of Halloumi and we should do everything possible to presevr the level of exports in volume.

If you could ask the Government to take specific measures or formulate policies to support/strengthen your sector, what would they be?

We have already given our positions to the government and the Ministries involved. What we keep repeating is that any decisions we make as industry players should be based on real data and comprehensive propositions.

Maintaining Halloumi exports in volume is the primary objective and all our actions should be aimed in this direction.

Any missteps that result in the reduction of Halloumi exports in volume will cause ripple effects in the industry with job losses, incalculable damage in raw milk spoilage and disruption to the agriculture sector dealing with the livestock sector, either at the production level raw milk or in the feeding and raising of animals.

Vigilance, vigilance and the pivotal role of technology

What are your organisation's plans/strategy for 2024? Should we expect new products/services/developments and your further establishment in the market? Will it be a year of growth/expansion or maintaining your existing market position? Can you tell us about any of your plans in particular?

Our strategy - as a philosophy and mission - always remains committed to the continuous commitment to maintaining the high quality of our products and satisfying the needs of our consumers.

As we have already said, conditions are extremely fluid and constantly changing. Consequently, we should strongly emphasise "vigilance" and keeping a constant eye on evolving purchasing conditions.

Our goal is to remain in a leadership position within the sector, while pursuing an active development path. This is something we systematically achieve as a company, as innovation is our driving force.

So we continue building even more on Corporate Social Responsibility with environmental, social and corporate governance at the core of our development philosophy.

What role does technology, such as artificial intelligence, play and what changes is it expected to bring about in your field?

Artificial Intelligence (AI) and related technologies are predicted to play a key role in the evolution of our dairy sector in the coming years.

The introduction of robotic systems in livestock units will enhance the efficiency of all operations while the application of Artificial Intelligence sensors will improve the monitoring of animal health and contribute to the prevention of diseases. At the same time, the analysis of data on milk production and quality will be done with increased accuracy, while algorithms will optimise the timing in the management of the units.

AI will also contribute to the nutritional adaptation of animals and strengthen quality controls throughout the production and processing process. A prerequisite for all this is the observance of the rules of ethics and the impact that may be created both on employment and in the adoption of new technologies by societies.

The status quo is also changing in the logistics and supply chain industry, where of course opportunities are emerging, but challenges, are also identified. So we are called to work together to understand the interactions between people and technology and develop a strategy to create an AI-based organisation.

This strategy should be adapted to issues of personal data security, expansion of digital solutions at the organisation level, technological infrastructures, the integration of traditional information systems, accessibility, compliance with the regulatory framework, as well as the availability of human resources with the necessary skills, combined, always, with the geopolitical tensions that test supply chains worldwide.

Innovation must proceed with the adoption of ethical practices, ensuring a smooth and sustainable transition into this new era of technology.

(Source: InBusinessNews)