The professional services sector is significantly influenced by external factors and the recession in the global and European economies - mainly due to the pandemic and its business implications - has inevitably left a negative footprint. However, the sector, which demonstrated high resilience levels to the previous financial crisis, is expected to rebound once again, adapting quickly to the emerging circumstances. In recent years, the sector has been restructured to meet the changing needs of businesses, investors and society.
The post-Covid-19 era will clearly be a return to "business with a difference", mainly due to the unprecedented ongoing crisis and restrictions imposed by the lockdown measures. The pipeline of new projects is not expected to be at last year's levels, but we shall rely on technological capabilities to help us maintain the momentum. The professionals of the sector should stay vigilant and creative in designing tailored upgraded e-services for their clients, without compromising quality or damaging client trust. The sector will be called upon to address the continuous adaptation of the business models according to each industry, so that businesses continue to serve the increased client needs in the post-Covid-19 era. "Business as usual" is expected to return gradually, after the wide usage of the vaccine in the society.
One major professional catalyst that cannot be ignored is technology, which disrupts the way in which services are offered to our clients. We have all experienced how the pandemic forcibly accelerated businesses' digital transformation. At KPMG, we acknowledge that technology lies at the forefront of future developments and, therefore, plays a key role in our efforts to enhance our professional service offering in the post-Covid-19 era. Currently, technology enabled us to carry out remotely a lot of work we used to perform at our clients' premises.
Economy today and predictions for 2021
It is anticipated that GDP will contract by four to five per cent this year, due to the pandemic and the slowdown of the economy. Certainly, the economic outlook has become more negative compared to the beginning of the year. A "long U-shaped" recovery is the most likely scenario (recovery in three to five quarters). The year 2021 will be another challenging year for the economy, which is expected to show growth between four to
five per cent.
I believe that over the next months all stakeholders shall base their efforts towards the gradual recovery of our economy on four pillars: relief measures following the lifting of restrictions, strengthening liquidity in the market, tax and other incentives that will accelerate investments and revitalise the market and labour, and proposing specific schemes for the development of vital sectors of the economy such as real estate, tourism, professional services, shipping, investments, entrepreneurship, health, etc.
For Cyprus to become a robust professional services centre, we need to secure its advantages and work towards adapting the services provided to investors and businesses, while offering the right incentives to international businesses to consider headquartering on the island. At the same time, we should be looking at expanding other sectors of the economy, as well as adjusting to the new business environment, by acquiring the necessary skills and by developing new ideas. I have said before and I want to repeat here that our economic model has changed dramatically over the past few years and we should all concentrate on supporting its transformation.
KPMG in Cyprus
KPMG has been implementing a robust crisis management plan, which proves to be successful. Placing health and safety of our people at the top of our priorities, the first step we took was to set up and activate an internal dedicated coronavirus monitoring team consisting of specialised professionals. One of the most important success factors of the team was that it provided guidance to all professionals in the firm relating to how they could act and behave during the pandemic. The integration of technology, which is part of our culture and processes across the board, enabled the firm to navigate through this uncertain time. A significant challenge not only for our firm but for most modern organisations, is the enhancement of technology infrastructure coupled with the acceleration of digital transformation.
As the pandemic continues to surge in our country, it is important to note that almost all our staff can work from home at any time, having immediate digital access to the office. KPMG in Cyprus is comprised of highly
capable professionals, whose experience and expertise would support the efforts for immediate adaptation of the Firm to the current volatile business environment.
Christos Vasiliou is the Managing Director of KPMG in Cyprus