Cyprus is on track for a new economic miracle, President of the Republic Nicos Anastasiades has said in the wake of praising reports by European media over Cyprus` impressive performance amid a deep financial crisis.
Anastasiades comments came in the wake of remarks by its international lenders that Cyprus is so far the only country under an economic adjustment programme to outperform its fiscal targets, performing better than Ireland, which exited an economic adjustment recently. Faced with the collapse of its oversized banking sector, Cyprus agreed last March on a €10 billion bailout which featured an unprecedented haircut on deposits and the closing of its second largest banks. Coupled with capital restrictions, the island`s economy entered into a deep recession, which however was much lower than the 8.7% envisaged by the Troika.
“It seems that Cyprus in on track for a new economic miracle, which does not elude the attention and the appreciation of our international lenders but also of the international press,” Anastasiades told a reception in the Presidential Palace for the Cyprus Exports Award 2012.
Following the 1974 Turkish invasion of Cyprus, which resulted in the occupation of 37% of the island`s territory and the devastation of its productive capacity, Cyprus by the 1980s recovered owing to strong tourist and a thriving services sector, in what has been described an economic miracle.
The President pointed out that just eight months from tough Eurogroup decisions and after three years of consecutive downgrades by rating agencies, Cyprus received its first upgrade last November, while it received three positive programme reviews by its international lenders, the European Commission, the European Central Bank and the IMF, collectively known as the Troika.
Anastasiades also said the targets for the primary surplus (the balance excluding debt servicing expenditure) in 2014 will be significantly lower, estimated at €277 million or 1.8% of GDP compared with the previous target of €483 millions or 3% of GDP.
He also recalled that international media and especially “Germany`s strict financial press after a series of negative reports today are making praising reports for the recovery of the Cypriot economy and the efforts to go ahead with structural changes and the necessary reforms.
“The government is doing everything necessary for the restart of the economy, for reform and modernization of the state and for the return of Cyprus to a growth trajectory,” he said adding the government is briefing foreign media for the reform programme in a bid to achieve inflow of capital.
It is imperative to create the right framework on which entrepreneurship will be encourage and favored.
“Our vision is to restore Cyprus` credibility abroad soon and mainly to become an important base for business and entrepreneurship in the wider region,” the President concluded.