Cyprus economy not in danger, ESM chief says

European Stability Mechanism (ESM) chief Klaus Regling said on Monday following a Eurogroup meeting that none of the five member states in the Post-Programme Monitoring (PPM) framework is in immediate fiscal danger.

The ESM chief explained that Cyprus, Ireland, Portugal and Spain have adequate fiscal reserves, market access, have been recently upgraded by credit rating agencies, and also have access to the EU’s Recovery and Resilience Facility.

However, Regling said that the financial situation in these countries is being closely monitored since they collectively have a €72 billion debt to the ESM and the European Financial Stabilisation Mechanism (EFSM).

In the case of Greece, Regling said that while progress has been made in regards to reforms and the reduction to non-performing exposures (NPEs), challenges remain, stemming from the effects of the pandemic and high energy prices.

However, the ESM chief noted that these issues are manageable, adding that both the pledge for further reforms and the implementation of Greece’s Recovery and Resilience plan provide additional opportunities for growth.