New Cyprus leader says he will pass reforms to secure bailout

Ben Southwood
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CYPRUS’S new conservative leader today told European leaders he would rapidly enact structural reforms if necessary to get hold of bailout funds.

Bond yields dived to an 18-month low of 9.45 per cent as the incoming President Nicos Anastasiades made the sharp break with his Communist and anti-reform predecessor Demetric Christofias.

“Long term prospects for Cyprus are excellent as we are committed to carrying out necessary structural reforms – we only need a helping hand now,” Anastasiades said in an interview published in German tabloid Bild this morning.

The conservative President-elect won some 57.5 per cent of the vote in a run-off election, giving the politician a clear mandate to do what is necessary to secure a bailout for the country’s drastically undercapitalised banking sector.

The small Eurozone member is believed to need around €17bn – about the same as its annual GDP – to fill in holes in Cypriot banks’ balance sheets opened up by Greek debt restructuring.

Anastasiades also used to the interview to talk down the extent and importance of money laundering in Cypriot banks, something that has been a major stumbling block in securing German support for a bailout.

“Money laundering is a global problem and no country can remain immune – however I believe the comments about Cyprus are wrong and exaggerated,” he said.