IMF praises progress in Cyprus’ rescue program

The Executive Board of the International Monetary Fund has praised Cyprus for the progress that has so far achieved in the rescue program agreed with the Troika (IMF, EC and ECB).

IMF convened Monday and approved the disbursement of €84.7 million in financial help to Cyprus. The announcement said that the Executive Board completed the first review of Cyprus’ performance under the economic program supported by a three-year, €1 billion, Extended Fund Facility (EFF) arrangement.

Sources told CNA that the meeting took place in a very positive atmosphere and that there were no difficulties in approving the amount.

The members of the Executive Board, including IMF chief Christine Lagarde expressed their views in a positive way and praised Cyprus’ progress in the implementation of what has been agreed upon with the Troika as well as the cooperation shown by the Cyprus authorities.

The same sources told CNA that Brazil’s representative in the Board criticized the haircut in deposits and the measures implemented in the banking system by the Troika.

The member of the Executive Board who represents Cyprus reiterated the country’s determination to fully implement Cyprus’ extended arrangement. He also referred to the liquidity assistance on behalf of the ECB towards Cyprus’ banking system and the need for small and medium size companies to get financial assistance the soonest possible.

The Extended Fund Facility (EFF) arrangement, approved on May 15, 2013, is part of a combined financing package with the European Stability Mechanism (ESM) amounting to €10 billion.

The package featured a sizeable reduction of the island’s banking sector, as well as bail-in of uninsured deposits, which hampered the services sector, one of the island’s main source of income