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CYPRUS ECONOMY ON THE MEND

simila cyprus economy
CYPRUS PRESIDENT Anastasiades has said that the country’s ailing economy is on the mend.
In his speech at the Economist conference in Nicosia, President Anastasiades presented recent signs of the economy, the positive Troika (EC, ECB, IMF) reviews of the implementation of Cyprus’ adjustment programme, as well as the efforts undertaken by the government to restart the economy and concluded that “the answer to the question posed by the conference as to whether the economy of Cyprus is on a positive course of restructuring is a positive one”.
At the same time he acknowledged that the economic environment will continue to be tough.
However, he pointed out, “the government will continue to closely and systematically watch developments and we will intensify our efforts to achieve growth, so that our country’s economy recovers as soon as possible”.
Anastasiades also referred to the link between economic growth and the efforts to find a solution in the Cyprus issue.
“A final solution of the Cyprus problem will create conditions of stability, will broaden prospects so that a reunited Cyprus, full EU member, having fully met its obligations but at the same time taken advantage of all its rights, will create the prospects of cooperation between the two communities, entrepreneurs and the citizens, resulting in peaceful coexistence in the framework of a modern European state”, he pointed out.
At the same time, he said, on the basis of recent data, it seems that the recession’s depth will be smaller than initially expected, at least for 2013.
He further stressed that it is his personal conviction that only by fully implementing the MoU foreign investor and citizens’ trust will be regained.
He acknowledged that most of the measures the government is forced to proceed with are painful but added that without them the country would follow in the footsteps of other countries which did not follow their adjustment programme to the letter.
President Anastasiades further noted that Cyprus’ international lenders have admitted that “no other country has had the performance of Cyprus”.
Referring to the banking sector he said that significant steps to the right direction have taken place including the full recapitalisation of Hellenic Bank and the beginning of the restructuring of the Cooperative sector.
At the same time, he pointed out that the island’s largest lender Bank of Cyprus is going ahead with its restructuring plan, having acquired a new Board of Directors and a new CEO.
“These steps contribute to the stabilisation and the gradual revitilisation of the market and the services sector”, he said.
According to the Cyprus President there are still great challenges to be met and that is why the approach followed should be a bold and consistent one.
Referring to lending rates and their reduction, he said the matter is up for discussion and he expressed the hope that through the restructuring of the banking sector small and medium sized companies will be given a chance to survive and to meet the challenges ahead.
President Anastasiades also referred to the efforts the government and himself personally are undertaking in the drive to attract new foreign investments to the island.
“Attracting foreign investments constitutes a top priority for the government, given the challenges faced by our banking sector”, he pointed out. 
He further expressed the point of view that positive results on that front will act as a catalyst for economic growth, the business environment, employment and therefore the country’s prosperity.
The Cyprus President also spoke of the efforts the government is undertaking to tackle rising unemployment in young people. He expressed his concern but at the same time welcomed the European Investment Bank’s recent announcement of two financing programmes for Cyprus and in particular the private sector of the country, which has taken a grave hit from the crisis.
He reiterated his government’s intention to use any financial tool on offer from the European Investment Bank in order to give access to funding to the sectors of the economy facing the greatest challenges. 
President Anastasiades also recalled a recent European Commission proposal of an extra €200 million for Cyprus due to the troubles the country faces, in the framework of the Multiannual Financial Framework 2014 – 2020, as well as the increase of EU contribution for co-funded projects from 60% to 95% until 2016 when the percentage will be re-evaluated.
Excluded from the international markets, Cyprus applied for financial assistance to cover its fiscal needs and to rescue its two largest bank hit severely by deteriorating assets amid the financial crisis and by the Greek sovereign debt haircut. The Cypriot authorities and the Troika (EC, ECB and the IMF) agreed last March on a €10 billion bailout, featuring haircut of uninsured deposits. So far Cyprus has received €4.7 billion.
FAMAGUSTA GAZETTE • Monday, 25 November, 2013

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