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Exit without interim programme

18/01/2016 12:03
Finance minister Haris Georgiades made it clear that Cyprus will not submit an application for either a new economic adjustment program, or for an extension of the current programme or even an interim program after the country's exit from the memorandum.

Speaking this morning at the state radio, Mr. Georgiades stressed that the state's fiscals and debt are under control and manageable but there are still challenges for the Cyprus economy.

He clarified that for the exit from the memorandum there are some options. There is the option of the affected country applying for a new programme, the extension of the current programme, or there is even the option of a bridge or interim programme.

He said these options were given for the Greek economic adjustment programme at the beginning of last year.
He explained that for Cyprus the procedure of exiting the programme will be easy and simple and that the Cypriot authorities do not intend to submit such a demand to the international creditors.

"There is" he added "a positive picture and acknowledgement of the general efforts of the Cyprus authorities, for the results of these efforts which have to do with the stabilisation, correction and reform of our economy".

He noted that on the other hand "there is expectation for the time remaining, we have to fulfill even the last prior action for the conclusion of the Cyprus programme".

He stressed that our European partners' interest is limited to the agreed prior actions and they are not many.
"It is just one and even that is not a full privatisation. It is the creation of a new telecommunications company that will belong to the state".

He said "for the rest it is our responsibility and our decisions which we hope to take in a composed, calm manner, based on the circumstances and not on prejudices, denials and exaggerations".

He claimed that "we are not presented with an agenda for massive privatisations, they are just a few and they are not even full privatisations like the case of the ports in which some services will be assigned to an investor to manage. In addition to the new telecommunications company to be formed, the other cases of privatisation are those of the national lottery and of the Cyprus stock exchange".

He explained that after March when Cyprus exits the memorandum, there will be no demands from the international creditors since, as he pointed out, there will be no economic adjustment programme.
He added however that it will be our own responsibility and we have to do our own planning to fulfill the obligations that are common and European and are not associated to any programme.

He pointed out that "after the exit from the memorandum we must not be led to mentality, choices and behavior that led us to derailment in the first case, which are the mentality of postponement, dogmatic refusal and failure to dare the changes needed".

The finance minister noted that the programme is upon completion "the difficulties have been overcome and that is why there is satisfaction at a European level as they confirm that the Cyprus economy has stabilised. But, it would not be right not to consider that there are still difficulties and challenges, and ignor the reform effort".

"We are still carrying as an economy, problems and distortions from the past which we must overcome through the continuation of our effort" he pointed out.

Referring to the seven bills that are at the parliament regarding the reforms programme in the public sector, Mr. Georgiades said that for him the modernisation of the public sector is a priority.

"These bills make sure that there will be no derailment again in the remuneration of civil servants which is associated to the hirings, salary increases and associated benefits" he said.

He pointed out that Brussels see the reforms effort losing its momentum and said this should cause concerns.

"If we prepare the 2017 budget without these provisions, there will be a serious problem because without these we will return to the old mentality" he said.