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The Finance Ministry completes on Friday the drafting of a set of measures aiming at boosting growth, Minister of Finance.

Speaking during a press conference, Kazamias said the Ministry will complete the drafting of a stimulus package and will submit a proposal to the Council of Ministers. He said the Ministry has already held contacts with other Ministries as well as with the social partners and that he will hold contacts with the political parties before the proposal is submitted to the Council of Ministers.

Furthermore, Kazamias clarified that the Russian loan of 2.5 billion EUR in combination with some renewals of current treasury bills will enable Cyprus to cover its refinancing needs for 2012. He also clarified that the Russian loan will assist Cyprus to finance its 2011 fiscal deficit as well as that of 2012. The Finance Minister said that a debt worth 1.3 billion will expire by February 3, adding that the Finance Ministry will sell bonds and treasury bills worth of 800 million, that is 500 million less than the expiring debt. He explained that these sum concerns foreign bond holders who, given the current financial circumstances, do not wish to refinance their bonds.

“This half a billion will be covered by the long-term loan which we have secured and as we announced today, its second installment has been received,“ he added. In his statements, Kazamias appeared certain that the Cypriot Banks, (Marfin Laiki Bank and Bank of Cyprus) will be able to secure the necessary funds to achieve their recapitalization without state support. Following the European Summit decision for a 50% haircut of the Greek debt, the two Cypriot banks must secure funds worth 3.53 billion euro to achieve a 9% Core Tier capital as stipulated by the capitalization exercise of the European Banking Authority.

“I believe that as things stand, the banks are in position to tackle any demands and issues might arise with regard to the Greek bonds,“ Kazamias said. He added that during the Eurogroup (the Euro area Finance Ministers meeting) and the ECOFIN (the EU Finance Minister Council) meeting he along with his counterparts from Portugal and Malta pointed out that “the issue of the Greek haircut is too serious to be left pending, because it creates problems.“CNA

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