Cyprus to claim more from EU funds to fight crisis, says Minister

Cyprus stands today more ready than ever before to claim additional money from EU funds in order to conclude a series of development projects, Minister of Communications and Works Tasos Mitsopoulos has said.

In statements to the press Monday, Mitsopoulos said that the Government, following negotiations with the international lenders, managed to exclude from the deposits haircut the money that flows in from European funding. This money, he explained, is used for the funding of large-scale projects.
The Minister added that Government will turn to the EU for more funding amidst of the tough times due to the economic crisis and the bailout program.

The Eurogroup has reached an agreement with the Cypriot authorities on March 25th on the key elements necessary for a future macroeconomic adjustment programme of 10 billion euro.
A haircut of around 40% on deposits over 100.000 euro at Cyprus’ largest bank, Bank of Cyprus will be imposed, whereas Laiki Bank will be resolved in a good and bad bank immediately – with full contribution of equity shareholders, bond holders and uninsured depositors – based on a decision by the Central Bank of Cyprus, using the newly adopted Bank Resolution Framework. Laiki deposits of up to 100.000 euro are guaranteed. The program also provides for downsizing of the public sector and privatizations.

Excluded from international markets, Cyprus applied in June 2012 for financial assistance, after its two largest banks sought state aid, following massive write downs of their Greek bond holdings amounting to €4.5 billion or 25% of the island`s GDP, as a result of the Greek sovereign debt haircut.