Cyprus needs EUR 75 m to avoid default on bills
Baku, April 9 (AZERTAC). Cash-strapped Cyprus will fall short by at least 75 million euros ($97 million) to pay its bills this month, including government salaries and pensions, an official warned on Monday.
Accountant General Rea Georgiou told parliament's finance committee that the government was trying to avoid a payment default for the month of April.
"The cash deficit for April is 160 million euros. The 85 million in reserve is not enough and we need a similar amount to avoid a default," Georgiou said, as the island awaits the first tranche of a eurozone bailout due in May.
Government spokesman Christos Stylianides told reporters the authorities were rushing to avoid a default on payments on state salaries and pensions, including pushing through additional bailout measures to raise funds.
"This government will do whatever is possible in the coming days to get bills passed relating to the (bailout) so we do not have a problem with salaries and pensions at the end of the month," he said.
"I want to believe that right now, everyone will show the necessary prudence to provide opportunities and safeguards so that the state has the possibility of funding."
Under the 10-billion-euro bailout deal struck with the European Union, European Central Bank and International Monetary Fund to prevent financial meltdown, Cyprus is obliged to drastically reduce the size of its bloated banking sector, raise taxes and downsize the public sector workforce.
In late 2012, the Cypriot government has already borrowed the money from state-owned companies.
Last week, the administration of the President of Cyprus Nikos Anastasiadis said that the authorities had made postponement of the loan agreement with the EU and IMF for a year - until 2018, which will enable Cyprus to soften the necessary spending cuts and tax increases.
At the request of government spokesman Christos Stylianidis, Cyprus received a "softening of the time", which allows better to implement a program to reduce unemployment and provide new jobs.
Cyprus also has introduced attractive to foreign investors, the tax on dividends, as demanded by the "troika" of creditors, said Stylianidis.
March 25 finance ministers of the 17 eurozone countries signed a preliminary agreement on financial assistance to Cyprus in the amount of 10 billion euros. The idea of one-time tax on contributions was rejected.
In exchange for financial assistance from the European country's largest bank - Bank of Cyprus-be restructured and cut down in size. The second largest bank in Cyprus - Cyprus Popular Bank (Laiki) - will be closed.
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