Government is preparing intensively for the negotiation with Troika (representatives of EU Commission, European Central Bank and IMF), and is processing its own proposals for addressing the challenges raised before the Cypriot economy and tackling long standing problems and distortions, Government Spokesman Stephanos Stephanou said Tuesday.
Stephanou reiterated that the objectives of the Government for the negotiation comply with the decisions that the last two EU Council have taken in terms of addressing economic crisis which affects the Union, in January and in June last year. Those decisions, he said, are based on three pillars: economic recovery, support of growth and preservation of the welfare state and social cohesion.
"It is our belief that the international experience, especially in Europe, in addressing the crisis has proved that one-sided and dogmatic austerity policies do not result in the exit from the crisis, but are putting the economies in a vicious cycle," the Spokesman said.
He added that in that sense the proposals of the government are well-documented, saying however that this does not mean that Troika will accept them.
Furthermore, Stephanou said that the Government will also have a consultation with Cyprus’ political parties on the proposals it will discuss with Troika.
Rebuffing press reports, the Spokesman said that Government does not delay the negotiations with Troika, adding that it is working with responsibility for better processing and documentation of its positions on the Cyprus economy and its perspective, as well as for the protection of the rights of the workers and preserving the standard of living of its citizens.
He also said that no date has been set for Troika’s next visit to Cyprus.
Stephanou denied that Government has noticed any dissatisfaction on the part of its European partners regarding its stance in the negotiations with Troika.
"We are in contact and have spoken sincerely with the Troika about what we want to ensure in Cyprus on the basis of the experience of other countries which received help by the support mechanism or the EU,” he said.
He also assured that the Government will complete the process in view of the negotiation with the Troika “very soon” adding that “we have already come a very long way."
Asked whether the Government has taken into consideration the economic and social consequences from the recapitalization needs of the banks, the Spokesman said that banks are a key part of the problem.
The Government, he said, wishes the Cyprus banking system to emerge stronger through this process, free from any distortions and problems because banks are a key component in the economy of any state.
The government of the Republic of Cyprus informed on the 25th of June 2012 the appropriate European Authorities of its decision to submit to euro area Member States a request of financial assistance from the EFSF/ESM.
A Troika mission was in Cyprus early July on a fact-finding mission for a close scrutiny of the banking sector, which has been severely hit by Greek sovereign debt haircut and over-exposure to the Greek economy, as well as the refinancing requirements of the Government. It returned to Cyprus in late July for another week, to negotiate with the Government the bailout terms and conditions. Consultations between the Government and the Troika continue with a view to conclude to a memorandum the soonest possible.
