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Dijsselbloem: The economic situation in Cyprus much better than expected

21 February, 2014

The state of Cyprus’ economy is today much better than original expectations, while the financial sector is stabilizing, the President of the Eurogroup, Joeren Dijsselbloem has told the Committee on Economic and Monetary Affairs of the European Parliament.

Dijsselbloem, who participated in the debate on the role of the Troika in the countries under memorandum carried out by the European Parliament, made a general statement and answered a series of questions by MEPs.

Referring to Cyprus, he noted that although the economic adjustment program is at an early stage, however there have been considerable efforts in the area of reforms, and the recapitalization of the financial sector.

He added that Troika’s evaluations show that the situation is much better than expected, compared with that of 2013 (when the program was decided), while the financial sector is stabilizing.

Invited to say who had proposed the first decision of the Eurogroup for Cyprus, rejected by the House of Representatives, on taxation of small depositors, Dijsselbloem said that his role does not allow him to reveal any details of the meeting.

The Cypriot authorities and the Troika (EC, ECB and the IMF) agreed last March on a €10 billion bailout, featuring haircut of uninsured deposits. So far Cyprus has received three positive reviews on the implementation of the Memorandum of Understanding, covering the conditions of the financial assistance.