IMF report on Cyprus economy discussed in the Ministerial Council

The Ministerial Council was briefed on Friday on the latest report by the International Monetary Fund, concerning the evaluation of the Cypriot economy, Government Spokesman Stephanos Stephanou said.

Stephanou remarked that the IMF salutes the goals and priorities set by the Government of Cyprus, aiming to reduce public deficit to 3% by 2012.

Speaking after the conclusion of the session of the Ministerial Council, Stephanou said that the government is determined to materialize these goals.

He added that the 2011 Budget submitted to the House of Representatives is a sign of the Government’s determination.

Stephanou noted that the Budget proposal is extending the Government’s effort to cut public spending, bring the economy back on track, support growth and back social policy.

The IMF predicts for the year 2011 a growth rate of 1,8%, which is higher than the prediction made by the Ministry of Finance, Stephanou noted.

He remarked that since some are putting the numbers into question, the data provided by the Government are right and its predictions are conservative vis-a-vis growth rate, revenues etc, “so that we stay within our targets, independent from the scenarios that will develop”.

The IMF report, Stephanou added, shows that the Cypriot economy has been affected by the international financial crisis, with some delay compared to other European countries, since recession started in Cyprus in the beginning of 2009.

The IMF, he went on, marks the start of recession in the beginning of 2009, and said that the Government took its first measures in November 2008 and adopted a second pack of measures in February 2009.

Asked by journalists whether the Ministerial Council discussed anything concerning the agreement to avoid double taxation with Russia, the Spokesman said that the agreement was signed only yesterday by the President of the Republic and the President of the Russian Federation and characterized it as very important.