Newly appointed Governor of the Central Bank of Cyprus Panicos Demetriades has said that austerity policy by itself is not enough to bring the finances of any country back to a healthy basis.
Addressing Saturday the conference of Cyprus`s bank workers union ETYK, he called for policies that promote growth and expand employment.
“ The fiscal compact agreed by the leaders of the euro zone is a significant step towards achieving fiscal balances, but further recession created by austerity measures unfortunately strengthens the vicious cycle between reduced economic activity and widening budget gaps,“ he said.
The Governor opted for enrichment of the fiscal compact with a strong framework of measures to stimulate growth. He added that a strong safety net over employment and living standards of citizens, putting an end to a further decline in state revenues and widening of deficit, is also required.