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Cyprus

Government optimistic that insolvency framework will pass

Foreign Minister Nicos Christodoulides

The government is optimistic that the House will pass the insolvency framework after the fifth and final bill was approved by the cabinet on Friday, Government Spokesman Nicos Christodoulides said on Saturday.

A green light from Parliament on the insolvency framework would then pave the way for implementation of the foreclosures legislation, which must come into force prior to completion of the fifth review of the island’s bailout programme. Then Cyprus can avail of the next tranche of aid, which has been postponed since December over the repeated suspension of the foreclosures law.

The House had passed the foreclosures bill into law in September but had voted to suspend its implementation on December 18, until the insolvency framework, meant to create a safety net for people affected by the crisis, could also be implemented.

“We expect that the House of Representatives which meets this week to discuss the matter will reach a positive outcome so that we can overcome this obstacle, this situation which has been created and the review on our lenders part can be positively completed, so that we can proceed to take the next very important steps forward,” Christodoulides said, adding that the government was optimistic deputies would do the right thing.

“The goal is by and large a common one,” he said.

The spokesman was also asked on Saturday ‘who knew what, and when?’, and to what extent the government had opted to turn the screws on depositors, in respect of the March 2013 deposits haircut, an issue that has hit the political arena in recent days.
Christodoulides said the politicians currently bickering over the issue should be more honest.

“Can anyone imagine that this government or any other government would not opt for a better solution had there been one?”, he said. “How could anyone imagine such a scenario?”
The alternative to the bail-in would have been the dissolution of the Bank of Cyprus, the island`s largest lender, and not just Laiki. (CNA)

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