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13 May 2014

Fourth evaluation of Cyprus by Troika

After Cyprus has successfully passed three previous Troika reviews, the time has come to go under the microscope once again since on May 6th 2014, the European Commission, the European Central Bank and the International Monetary Fund representatives came back to Cyprus for a fourth review to measure the country’s progress in implementing the terms of its 10 billion-euro rescue, but this time around, focusing more on Non-performing loans (NPLs) and the roadmap for the implementation of the National Health Scheme (NHS).

The three earlier reviews were very positive, showing that the country’s bailout program was on the right path with the Cypriot government comfortably meeting its fiscal targets.

Several issues are scheduled to be reviewed relating to the bailout program at a technocratic as well as political level. Discussions will be held on three levels including the Finance Ministry, the Central Bank and the Directorate General for European Programes in relation to public finances and macroeconomic developments, issues regarding the banking sector and structural reforms.

The ministry has submitted to the Troika the roadmap for the autonomy of state hospitals and Heath Minister Philippos Patsalis said that, an important issue to be looked at closely and on Troika’s agenda, is the roadmap for the implementation of the National Health Scheme (NHS) and explained that the roadmap includes all the important steps including legislations, decrees, regulations and the reform of state hospitals and the ministry.

The International lenders are also expected to re-evaluate the commercial banks’ operational capacity in loan management units, which is scheduled to be completed for co-operative banking by the end of May. An important factor, is that the law on insolvency and the framework for property repossessions, as well as the institution of paying rent instead of mortgage, will help to promote effective re-structuring and re-servicing of loans.

Article published by: ServPro Accountants & Consultants, 13 May 2014

 

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