* European Commission to make statement on outcome of Cyprus
* Bailout could total up to 17.5 billion euros
(Adds European Commission comment, further Christofias quote)
NICOSIA Nov 22 Cyprus is close to agreeing a
bailout package with the European Union and IMF, President
Demetris Christofias said on Thursday after the latest round of
talks with the international lenders.
Two EU sources said the agreement was nearly done but would
be completed only on Friday, when inspectors from the European
Commission, European Central Bank and International Monetary
Fund - together known as the troika - are likely to give their
The Commission, asked about reports that a deal had been
agreed, said it would only issue a statement on Cyprus on
"We will communicate on the outcome of the mission to Cyprus
tomorrow," Commission spokesman for economic and monetary
affairs Simon O'Connor said.
Christofias, in Brussels for the EU leaders' summit, told
reporters when asked about a deal with the troika: "We still
work very hard."
The Mediterranean island sought financial aid - which could
be up to 17.5 billion euros ($22.6 billion), equal to its entire
gross domestic product - from the European Union and IMF in
June, after its banks were battered by their exposure to the
"After tough negotiations with the troika ... we are very
close to signing a memorandum," Christofias said in a statement.
"Very few issues remain and it's possible that the gaps in these
issues will be bridged very soon."
The troika team left Cyprus on Thursday. It said in a draft
statement seen by Reuters that it had made "good progress" and
discussions aimed at "a potential programme" would continue from
their respective headquarters.
Cyprus and the troika have been at odds over a host of
issues, including privatisations and pension cuts, as well as
the amount needed to recapitalise the banks.
Cypriot government sources said the two sides had struck a
preliminary agreement over a 17.5 billion euro bailout, although
EU sources could not confirm the figures.
Two EU officials told Reuters the Cypriots had presented a
final, detailed proposal including figures, and that the troika
would examine it on Friday.
"We are very close, but there's no deal yet," one official
said, speaking on condition of anonymity. "We will have more
discussions on Friday and if all goes well, we will be able to
finalise an agreement then."
A troika source told Reuters in Nicosia that a debt
analysis and financing needs still needed to be addressed.
An analysis on the state of Cypriot banks is expected by
Dec. 3, when euro zone finance ministers meet again in Brussels
and aim to decide on a programme for the government in Nicosia.
The troika was initially due to leave Cyprus last weekend
but stayed on to continue the talks. The team is expected to
return at a later date, a finance ministry spokesman said.
"If the president says we're close, we're close," Finance
Minister Vassos Shiarly, who has been leading the negotiations,
told parliament on hopes for a deal.
(Reporting by Luke Baker, Jan Strupczewski and Barbara Lewis in
Brussels, Constantinos Tsindas in Nicosia and Annika Breidthardt
in Berlin; Writing by Karolina Tagaris and Annika Breidthardt;
Editing by Stephen Nisbet, David Stamp and Rex Merrifield)