Cyprus Mail

Georgiades: recession seems to have run its course

The finance minister said on Tuesday the downturn on the island appeared to have bottomed out, after the economy showed an improvement over the past four quarters.

“The long recession seems to have run its course,” Harris Georgiades told the Economist Conference in Nicosia.

Quarterly data for the past four quarters showed the depth of recession was losing steam, Georgiades said. “There has been stronger than expected resilience of main productive sectors of the economy and confidence has been re-established,” he said.

Georgiades said Cyprus expected to achieve a marginal primary fiscal surplus and would exit an excessive deficit procedure two years earlier than scheduled.

But the island needed to rely on international lenders’ confirmation that it was on the right course to reform and consolidate its economy and “rectify mistakes of the past,” Georgiades said.

“We do need the Troika institutions for a little while longer,” Georgiades said. “For me, what’s even more important than the cheap financing, that also of course, but what is even more valuable, is the seal of approval of the International Monetary Fund and the European institutions which comprise the Troika”.

Georgiades added that while having third parties interfere in Cyprus’s domestic political process “is never pleasant,” the island needed their confirmation that it was doing things right when it came to restoring confidence in the economy, which will help lay the “foundation of a more viable economic model,” attract investment and create jobs and opportunities.

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