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Coronavirus: Cyprus economic package to amount to €1.5 billion

Finance Minister Constantinos Petrides warned repeatedly that if spending was not brought under control the system would collapse

The finance ministry is working to finalise a revised economic support package which will amount to at least €1.5 billion, approximately 7% of GDP, reliable sources told the Cyprus News Agency (CNA) on Monday.

Last week Finance Minister Constantinos Petrides announced a financial support package amounting to €700 million, equivalent to 3% of Cyprus’ GDP. However, Petrides following a meeting with parliamentary parties, announced the government will approve additional measures, including the provision of government guarantees.

According to a ministry source, Petrides will continue contacts today and tomorrow with Central Bank Governor Constantinos Herodotou, representatives of political parties and with the CEOs of commercial banks.

Petrides will meet Herodotou on Monday along with the ministry and CBC dedicated teams to discuss the issue of granting government guarantees to borrowers affected by the coronavirus epidemic.

The aim is to finalise the revised economic package by Tuesday the latest in a bid to submit bills to the Council of Ministers for approval, the same source told CNA.

“The package will amount to at least €1.5 billion,” a high-ranking official told CNA, noting that it will include direct support, deferred government income in the form of payment suspension of direct and indirect taxes and other fees, as well as government guarantees which will not incur fiscal impact unless they materialise.

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