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Cyprus

Georgiades hits back at AKEL’s “provocative” criticism

Finance Minister Harris Georgiades

Finance Minister Harris Georgiades dismissed criticism by AKEL on the government’s economic policy and its demand that the latter should give up the “painful austerity” in favour of policies promoting growth and improving the standard of living of workers and vulnerable groups.

“It’s a provocation to have AKEL criticise this government for prescribing painful austerity and ask for the consolidation of public finances plus tax relief,” Georgiades told reporters in Nicosia on Tuesday according to the emailed transcript of his comments.

In his strongly worded statement, the finance minister was responding to comments made by Andros Kyprianou, the general-secretary of communist AKEL.

Kiprianou Andros AKELAccording to the Cyprus News Agency, Kyprianou said that after the country’s economy experienced violent changes after March 2013, when the newly elected government under Nicos Anastasiades agreed the terms of a €10bn bailout, leading to a drop of incomes for the majority of citizens benefiting the incomes of the few.

Kyprianou, who was also talking to reporters five days before Cypriot voters are asked to elect a new parliament, the first major test for the DISY-led government after Cyprus completed its adjustment programme in March, said that AKEL’s philosophy on economic policy is based on establishing a socially sensitive state, fiscal consolidation, tackling tax evasion in an attempt to release resources for growth and social cohesion, according to the Cyprus News Agency.

“Let me remind that during the AKEL administration, the largest (ever) fiscal deterioration was recorded,” the finance minister continued adding that the government generated a budget shortfall of €911m in 2010, and over €1.1bn in each 2011 and 2012.

“They burdened these fiscal deficits to the taxpayer by imposing a series of tax increases,” he said. “They resorted to applied austerity and led the economy into a deep recession”.

The Anastasiades administration “has assumed responsibility to correct this situation,” Georgiades said. “From 2014 onwards, our state works with a balanced budget. We have created an environment favouring growth”.

Georgiades added that the government generated in the first quarter of 2016 a fiscal surplus of €147m, or 0.8 per cent of economic output, which he described as “very satisfactory” and added that the government intends to reduce the burden on the taxpayer which resulted from “irresponsible practices of the past”.

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