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Our View: If Cyprus wants to sue anyone for providing Laiki with ELA, it should be the CBC boss

EVERY few days we seem to hear another ingenious idea, for solving the economy’s problems, from the members of our ruling elite. All that is required is a few seconds’ thought to realise that the idea makes no sense.

For instance Giorgos Lillikas’ assertion that we could pre-sell €10bn worth of natural gas we had not yet found in order avoid the memorandum of understanding was a shining example of the genre. It assumed that a state or company would part with €10bn on the promise of receiving a massive quantity of natural gas that might not exist in Cyprus’ EEZ, at the earliest, in six to seven years’ time. He did not stop repeating it, as if by repeating this fairy-tale it would suddenly come true.

Meanwhile the Cyta chairman and his colleagues at EAC and the Ports Authority came up with an even more ingenious idea to prevent the privatisations of their organisations. They would borrow the €1bn the government hoped to raise from their privatisation and hand it over to the state. This was based on the absurd assumption that a reputable credit organisation would lend such an astronomical amount, for an unproductive purpose.

And should we mention the government’s brilliant idea to promise unions that the bankrupt national carrier would pay redundancy compensation totalling €20m to the 400-plus employees it would get rid of? Where would a bankrupt company that just about manages to stay in business find this kind of money to pay out? Cyprus Airways’ previous board resigned because it could not find the funds, so the government appointed a new board, as if it would find the €20m that is not available.

On Monday, the new DISY chief Averof Neophytou urged the government to sue the President of the ECB Mario Draghi for authorising the transfer of billions in emergency liquidity assistance to Laiki Bank despite the fact it was insolvent. Apart from the stupidity of bankrupt Cyprus picking a fight with an organisation that could annihilate what survives of its economy in a day, the idea also ignores the line of command.

If the Republic wanted to sue anyone for providing Laiki with ELA, it is the Governor of the Cyprus Central Bank, as he was the one applying for liquidity assistance from the ECB. It was the Governor who reported to the ECB telling it that Laiki and subsequently the state (when it was nationalised) had provided adequate collateral to cover the loans. And the Governor admitted he had not resolved the insolvent bank because he had instructions from the previous government – not from the ECB or Draghi – to do this after the presidential elections. He was the one authorising more ELA for Laiki.

But The Republic will sue Draghi, because he did not prevent the Governor of our Central Bank from taking reckless decisions at the behest of the president that appointed him.

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