CYPRIOT ministers yesterday promised to stick by the conditions of the troubled Eurozone state’s bailout package, having reassured the island’s public that it is in the best interests of the struggling economy.
The International Monetary Fund (IMF) had earlier revealed a €10bn
(£8.5bn) rescue package to be provided by the troika – which also includes the European Union and European Central Bank (ECB).
The IMF will chip in with €1bn, with the UK’s share estimated at around €50m.
The bulk of the contributions will be made by the Eurozone.
“We shall implement [the memorandum of understanding] fully, and without any derogations. We shall meet all time-frames, we will meet all targets,” responded new finance minister Harris Georgiades, who had been sworn in after his predecessor Michael Sarris quit on Tuesday.
Despite ongoing unrest in Cyprus – trade unions are pushing for further protests and strikes – the government praised the bailout deal after it was settled on Wednesday night.
“This is a very important development which ends a very long period of uncertainty,” spokesman Christos Stylianides said.
Yet IMF chief Christine Lagarde warned yesterday that the road to recovery could be bumpy.
“This is a challenging programme that will require great efforts from the Cypriot population,” Lagarde said. “We believe that it provides a durable and fully financed solution to the underlying problems facing Cyprus and provides a sustainable path toward a recovery.”
The Cypriot government will be expected to find a further 4.5 per cent in cuts by 2018, on top of the seven per cent reductions already penciled in by 2015.
The so-called Eurogroup of Eurozone finance ministers meet in Dublin on 12 April – during which they are now expected to sign the bailout agreement through.
The first tranche of bailout payments to Cyprus could happen as early as next month. Some of the island state’s debt matures the following month.