06/07/2011 13:49
Finance Minister, Charilaos Stavrakis appeared reassuring today for the state’s finance needs in 2011 and 2012.
In an announcement to the media, Mr. Stavrakis said that the state’s finance needs until 2011 fall short of €150 million, €60 million of which were covered today with the allocation of a credit line by a Russian bank.
“For 2012, the finance needs are of €2.4 billion, 61% of which are held by Cypriot banks and semi-governmental organizations, expected to participate in the new debt issues”, he said.
The deficit needs reach €630 million and the refinance needs €1718 million.
“Apart from the debt that the banks and domestic institutional investors hold, there are net needs of €928 million”, the Minister noted.
“Therefore, everything said about Cyprus entering in the bailout mechanism is funny, since the total needs are restricted”, he added.
“The needs may be covered easily with certain moves made by the Ministry”, he stressed.
Mr. Stavrakis also gave special emphasis to the efforts for an interest rate cut in the secondary market, since they exceed 8%.
“The gradual rate cut will send the right messages to the market. The Ministry’s aim is 4.4% of GDP, which might drop further with the adoption of measures such as the allocation of €35 million by the public sector and the duty of €1000 to the businesses”, he said.
“If the government manages to absorb money from foreign investors with the Ministry’s actions, we will send positive messages to the secondary market”, the Minister added.
Among the finance needs of 2012, the Ministry does not include the special bond issue in December 2009 for the support of the banks’ liquidity. “This is an obligation of the banks and not the state”, he noted.
Responding to questions, the Minister said that he expects that the banks will refinance their debt. “We anticipate that the banks will maintain the current debt”, he stressed.
“In all countries, the banking sector covers part of the state’s borrowing needs”, Mr. Stavrakis concluded.
In an announcement to the media, Mr. Stavrakis said that the state’s finance needs until 2011 fall short of €150 million, €60 million of which were covered today with the allocation of a credit line by a Russian bank.
“For 2012, the finance needs are of €2.4 billion, 61% of which are held by Cypriot banks and semi-governmental organizations, expected to participate in the new debt issues”, he said.
The deficit needs reach €630 million and the refinance needs €1718 million.
“Apart from the debt that the banks and domestic institutional investors hold, there are net needs of €928 million”, the Minister noted.
“Therefore, everything said about Cyprus entering in the bailout mechanism is funny, since the total needs are restricted”, he added.
“The needs may be covered easily with certain moves made by the Ministry”, he stressed.
Mr. Stavrakis also gave special emphasis to the efforts for an interest rate cut in the secondary market, since they exceed 8%.
“The gradual rate cut will send the right messages to the market. The Ministry’s aim is 4.4% of GDP, which might drop further with the adoption of measures such as the allocation of €35 million by the public sector and the duty of €1000 to the businesses”, he said.
“If the government manages to absorb money from foreign investors with the Ministry’s actions, we will send positive messages to the secondary market”, the Minister added.
Among the finance needs of 2012, the Ministry does not include the special bond issue in December 2009 for the support of the banks’ liquidity. “This is an obligation of the banks and not the state”, he noted.
Responding to questions, the Minister said that he expects that the banks will refinance their debt. “We anticipate that the banks will maintain the current debt”, he stressed.
“In all countries, the banking sector covers part of the state’s borrowing needs”, Mr. Stavrakis concluded.
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