20 September 2013 10:12

NICOSIA - Cyprus was praised yesterday by the Troika for meeting the terms of its financial rescue but they warned Nicosia it mustn't slacken the pace of reforms to restore market confidence.
Delia Velculescu, the IMF's mission chief for Cyprus said the island has made "good progress" in meeting the fiscal targets outlined in the bailout deal.
However, she said lingering uncertainty over the economy, especially over a shaky financial system, mean authorities mustn't waver in their plans to streamline the public sector, improve tax collection and sell state companies.
"With large uncertainty and downside risks, fiscal prudence and strong and timely policy implementations remain critical for the program's success," Velculescu said from her base in Washington D.C.
And the government plans to complete a phasing out of all capital controls in January, President Anastasiades said yesterday.
"The controls are being lifted," Anastasiades told Bloomberg. "They will end within a timeframe of January 2014."
Six months after a banking debacle, Nicosia is dependent on loans from its creditors, including the International Monetary Fund, in order to pay the bills.
The government has promised to adhere to the bailout's terms as the quickest way to get the economy back on track.
Next year, it plans to cut spending by a further €700 million, but says it won't impose new tax hikes.


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