IMF expects Cyprus growth to resume in 2015, but "significant risks remain"

The IMF expects growth to resume in 2015 in Cyprus, however there are macroeconomic uncertainties and risks, which remain significant, the Fund’s spokesman Gerry Rice said on Thursday, during a press briefing, in Washington.

He also said that the first review mission in Cyprus is scheduled for late July and the mission chief, Delia Velculescu, will participate in the mission.

Asked about the IMF’s admission over mistakes in the handling of Greece’s bailout and whether a similar admission could eventually come up in the future for Cyprus’ program as well, Rice said that “every country is different” and that “generalizations don`t make a lot of sense”.

On the Cyprus’ program, he said that macroeconomic assumptions take account of several factors that are expected to effect growth in the short and medium run, including the fiscal adjustment underway and the recent policy actions in the financial sector.

“Having dealt with the key problems facing Cyprus upfront, we expect growth to resume in 2015, again assuming a favorable international tax regime, progress on structural reform, institutional reforms etc” the IMF spokesman said.

He added however that, given Cyprus’ situation “there are of course macroeconomic uncertainties and risks” and added that those risks to the outlook remain significant.

Rice said finally that this is something the IMF will be monitoring closely, as the situation evolves.