Cyprus has funds until May: outgoing finance minister

NICOSIA Wed Feb 27, 2013 10:28am EST

An EU and a Cyprus flag flutter in front of Laiki Bank's headquarters in Nicosia February 21, 2013. REUTERS/Yorgos Karahalis

An EU and a Cyprus flag flutter in front of Laiki Bank's headquarters in Nicosia February 21, 2013.

Credit: Reuters/Yorgos Karahalis

NICOSIA (Reuters) - Cyprus's outgoing finance minister Vasos Shiarly said on Wednesday the government has funds to cover its obligations until May as its eight-month wait for an international bailout continues.

"Based on the data before us, fiscal issues can be managed without a problem until May, because we always work three months ahead," Shiarly told reporters after meeting Cyprus President-elect Nicos Anastasiades and Michael Sarris, the island's new finance minister.

Shiarly, who formally hands over to the new centre-right government on February 28, said that based on present circumstances the state would not need to resort to additional borrowing for another two months.

Cyprus has been holding inconclusive talks for a loan from the International Monetary Fund and the European Union since an EU-sanctioned debt writedown of Greek sovereign debt saddled banks on the tiny Mediterranean state with losses equalling about 25 percent of its gross domestic product.

A rapid deterioration of the island's economy since then could see it receiving up to 17 billion euros in aid, almost equal to its economic output.

Anastasiades has vowed to press ahead aggressively to clinch a bailout deal.

(Reporting by Michele Kambas; editing by Patrick Graham)

Photo

After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.