Greek Cypriot leader rejects ‘Greek-style’ bailout model

Greek Cypriot leader rejects ‘Greek-style’ bailout model

ATHENS- Agence France-Presse
Greek Cypriot leader rejects ‘Greek-style’ bailout model

Greek Prime Minister Antonis Samaras (L) talks with the President of Greek Cyprus, Dimitris Christofias, during an official meeting in Athens, Greece. EPA photo

Greek Cyprus President Demetris Christofias rejected yesterday a Greek-style international bailout for his nation’s struggling economy, arguing that “deadly” policies on pay cuts and state asset sales had failed.

“The neo-liberal method of dealing (with the crisis) is bankrupt, this is clear from the situation in Greece,” Christofias, a Communist, told Greek state television NET.

“The policy of the ‘troika’ is deadly,” he added, referring to auditors from the European Union, the International Monetary Fund and the European Central Bank that are supervising bailouts for Greece, Ireland, Portugal and now Greek Cyprus.

Christofias said he would not approve the elimination of inflation-pegged wage increases “and two-three other measures” demanded by creditors such as the sale of profitable partially state-owned companies.

“It is a vicious circle,” the Cypriot president said.

“We are not simply saying ‘no’, we are making counter-proposals,” he said, dismissing as a “fairy tale” the notion prevalent in northern Europe that southern EU nations are “idlers.” In return for two bailouts, Greece has had to implement sweeping salary and pension cuts over the last two years that have led to record unemployment and plunged the economy into a deepening recession.

Another round of austerity measures worth 7.8 billion euros ($10 billion) is planned by the Greek government for next year.

Christofias was in Athens on Sept 2 for talks with Greek Prime Minister Antonis Samaras.
Troika representatives have visited Cyprus twice since June, when the country called for help after both Bank of Cyprus and Cyprus Popular Bank said they could not raise funds to meet recapitalization requirements.

A third visit to sign a memorandum has been postponed, as the EU is awaiting the government’s counter-proposals for austerity under the terms of an eventual loan deal.