21/02/2022 08:46
Cyprus` Finance Minister Constantinos Petrides expressed concerns on Saturday over the high inflation in the EU and said that we need to deal with it by using monetary means.
Addressing a conference on the future of Europe, the Minister praised the many benefits from Cyprus joining the EU adding that if the country had not been an EU member state and member of the Eurozone, in the 2013 fiscal crisis we would have ended up like Turkey today.
He added that the future is not only the Recovery and Resilience EU fund and we should not see this as the panacea but rather a tool. Petrides said that two years ago the pandemic led the EU to a heart attack situation reminding everyone that for the first time the EU prohibited the operation of the economy by law. Petrides said that the EU, often criticised, showed quick reflexes for a change in the monetary policy and the issuance off the joint debt instrument for the resilience fund.
He warned however that two years down the lane we are still faced with many challenges and things will not be easy.
Commenting on the debate in the EU for a new monetary approach, he said that there are two schools of thought but the solution is somewhere in the middle.
Petrides said that we should not underestimate the EU budgetary rules as these led to a strong euro and to prosperity. He pointed out that debt has risen and many countries need to address this issue and manage it but added that Cyprus is not one of these countries because we were successful in managing well the situation.
He said that long periods of low interests are related to the inflation today, the high real estate prices and the increase in prices of many products. Petrides said that the inflation nowadays in the EU is similar to the 1980-81 period and added that he does not agree with those arguing that this is a temporary phenomenon. He said that we need to stand ready to manage it using monetary means.