A Troika mission (EC, ECB, IMF) continues on Thursday its second review of Cyprus’ implementation of a Memorandum of Agreement, the basis of an international bail-out, with discussions focusing on energy matters, semi-governmental organizations, closed professions, and national air carrier Cyprus Airways.
A Technical Support Group appointed by the European Commission in the context of the effort to create further growth will also be holding meetings with officials of the Ministry of Finance and the Planning Bureau at 09.30 hrs on the establishment of a public finances management department and a revenue department. The Technical Support Group will also meet with officials of the Ministry of Labour in the afternoon at 17.00 hours.
Discussions on the country’s financial sector continue at the Central Bank of Cyprus, focusing mainly on the Hellenic Bank, former Cyprus Popular Bank and the exchange of views between the Troika with Alpha Bank management and the Association of Cyprus Banks.
Troika meetings begin at 08.00 hrs at the Planning Bureau with Ministry of Finance officials on the restructuring plan of Cyprus Airways and its financial obligations.
The reform of closed professions and in particular putting an end to restrictions on advertising will be the focus of the next Troika meeting at the Planning Bureau, at 09.00 hrs.
In another meeting, taking place at the same time, Troika officials and Ministry of Finance, Central Bank and Statistical Service officials will discuss the methodology to be followed when compiling national accounts.
The implementation of the EU services directive and relevant legislative provisions by sector (construction, tourist agents, vehicle rental companies, recruitment companies, security companies) will be discussed during a meeting at the Planning Bureau at 10.00 hrs.
A meeting on energy matters due to last until 16.00 hrs with an hour long break at 13.00 hrs begins at 11.00 hrs. Discussions will focus on the overall energy strategy, the 3rd Energy Package and the import of natural gas.
Representatives of the Ministry of Energy, Commerce, Industry and Tourism, Natural Gas Public Company (DEFA), Ministry of Finance and Cyprus Energy Regulatory Authority (CERA) are expected to take part in the meeting.
At 14.00 hrs another Troika mission team meets with Central Bank officials to discuss its report on household and business loans.
At 16.00 Troika officials will discuss matters pertaining mainly to semi-state organizations with Ministry of Finance and Ministry of Interior officials, focusing on recording central government assets, the operation and financial state of semi-state organizations as well as the plan on strengthening governance and the organisations’ institutional framework.
Cyprus came last March near a financial meltdown when its two largest banks requested state aid to cover mammoth losses due to soaring bad loans related with the housing sector and the write down of their Greek bond holdings as a result of the Greek sovereign debt haircut. Excluded from international markets the Cypriot government applied for financial assistance.
The government agreed with the Troika (European Commission, European Central Bank and the IMF) on a €10 billion bailout, which featured a 47.5% haircut on uninsured deposits in Bank of Cyprus, the island’s largest lender to replenish the bank’s capital shortfall. Cyprus Popular Bank would be wound down with its good part absorbed by BOC.
