Cyprus debt is manageable, said Saturday Central Bank Governor, Panicos Demetriades after meeting with Cypriot President Demetris Christofias to discuss financial issues in view of the negotiation between the Government and its international lenders known as Troika (IMF, European Commission, European Central Bank).
Denying fears that Cyprus’ dept would not be sustainable after a bailout agreement, Demetriades stressed that regardless of the amount needed for recapitalization of Cypriot banks, the debt of the country will be manageable, because the loan that Cyprus will get will be mainly for the recapitalization of the banks that are highly exposed to the Greek market.
Describing the international loan as an investment for the country, he said that in the worst case scenario the debt will come back down to manageable levels when the banks return to private hands.
He also pointed out that the Cyprus will seek direct recapitalization from the new European Stability Mechanism, once it started.
Speaking about the upcoming negotiations of Cyprus with Troika, he said that the Central Bank sees it as an opportunity.
“In the Central Bank we are working and we see this deal as an opportunity for consolidation of the financial system of Cyprus and to promote our views through the negotiations, “he said.
He also said that Cyprus is in the final straight to sign a deal with the Troika, so the growth of the economy could start.
Government: We wish to discuss with the Troika in good faith
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Speaking after the meeting, Government Spokesman Stephanos Stephanou stressed that the Government wishes to discuss with the Troika in good faith and to reach a result that will satisfy both sides.
“As the President of the Republic stated yesterday from Brussels, we are ready to proceed in the negotiation with the Troika, in order to achieve the best possible outcome”.
For this reason, he added, the Government has done an intensive and well documented work in order to be convincing in the negotiation for several things they consider important for both, the preservation of employees vested rights and for the economy to have a perspective, overcome problems and able to move forward .
Invited to comment on information that the Troika will arrive in Cyprus on Monday, Stephanou said that no date has been set yet.
He added that the goal of the Government is to close the deal with the Troika as soon as possible.