25th Mar 2023

Cyprus bailout to dominate EU ministers' talks

  • Cyprus is seeking a bailout package worth up to €18 billion (Photo: jnocca93)

Eurozone finance ministers are meeting on Monday (4 March) amid expectations of swift movement on a bailout for Cyprus before the end of March.

The Mediterranean island elected centre-right politician Nicos Anastasiades in last week's presidential vote, increasing the prospect of a swift rescue deal.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

The new government was sworn in on Friday, with Michalis Sarris, the country's new finance minister, set for a grilling in Brussels on his attitude towards a privatisation programme.

The previous government, led by Communist Demetris Christofias, was opposed to privatisation - one of the demands made by international lenders for the bailout to go ahead.

Cyprus is expected to need between €15 billion and €18 billion to recapitalize its banks and to enable the government to meet its commitments.

The debt deal would see Cyprus' debt to GDP ratio rise to 140 percent, second only to Greece in the eurozone.

The EU is also anxious to see the results of an investigation by a private audit firm on the implementation of rules against money laundering, amid reports that the island's banks are a haven for dodgy Russian businessmen.

A senior EU official indicated there is "hope that the new government will be forthcoming," adding that "the troika [the European Commission, the European Central Bank and the International Monetary Fund] has been waiting for quite some time to find an interlocutor in Nicosia."

He said the three international lenders are "close to [finding] a conclusion in the second half of March".

Cyprus is predicted to run out of money in May unless it gets help.

But for his part, German finance minister Wolfgang Schaeuble told German newspaper Tagesspiegel over the weekend that ministers are prepared to take their time.

"We will decide without rushing. Cyprus's problem is not easy to solve," he said.

The Eurogroup meeting will also be the first ministerial gathering in the wake of dismal forecasts for the European economy.

Figures released by economic affairs commissioner Olli Rehn last month projected that the eurozone would remain in recession in 2013, with an expected contraction of 0.3 percent.

Rehn also said that a number of countries are expected to miss their deficit targets because of the downturn, meaning the commission will have to consider extensions of its deficit-cutting timetable.

Any decisions on the timetable are not expected before May, when the Spring economic forecast will be published, however.

'Final warning' to act on climate change, warns IPCC

The United Nations's report — synthesising years of climate, biodiversity, and nature research — paints a picture of the effects of global warming on the natural world, concluding there is "no time for inaction and delays."


EU's new critical raw materials act could be a recipe for conflict

Solar panels, wind-turbines, electric vehicle batteries and other green technologies require minerals including aluminium, cobalt and lithium — which are mined in some of the most conflict-riven nations on earth, such as the Democratic Republic of Congo, Guinea, and Kazakhstan.

Latest News

  1. EU's new critical raw materials act could be a recipe for conflict
  2. Okay, alright, AI might be useful after all
  3. Von der Leyen pledges to help return Ukrainian children
  4. EU leaders agree 1m artillery shells for Ukraine
  5. Polish abortion rights activist vows to appeal case
  6. How German business interests have shaped EU climate agenda
  7. The EU-Turkey migration deal is dead on arrival at this summit
  8. Sweden worried by EU visa-free deal with Venezuela

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic and Baltic ways to prevent gender-based violence
  2. Nordic Council of MinistersCSW67: Economic gender equality now! Nordic ways to close the pension gap
  3. Nordic Council of MinistersCSW67: Pushing back the push-back - Nordic solutions to online gender-based violence
  4. Nordic Council of MinistersCSW67: The Nordics are ready to push for gender equality
  5. Promote UkraineInvitation to the National Demonstration in solidarity with Ukraine on 25.02.2023
  6. Azerbaijan Embassy9th Southern Gas Corridor Advisory Council Ministerial Meeting and 1st Green Energy Advisory Council Ministerial Meeting

Join EUobserver

Support quality EU news

Join us