President Demetris Christofias likens the EU, European Central Bank and IMF to a 'colonial force'
Less than 24 hours before Cyprus resorted to the European rescue fund, its President Demetris Christofias lambasted the fiscal remedies meted out by the troika – the EU, European Central Bank and IMF– on the countries it had sought to save.
The Cypriot leader told the Sunday Vima newspaper that, more often than not, the troika had operated like a "colonial force", pushing austerity measures and neo-liberal policies on nations that had asked for help. The result had been disastrous for Greece and, by extension, Cyprus whose banks had been heavily exposed to the debt-stricken country.
His harsh words reflect the reluctance of Cyprus to resort to the mechanism. Senior officials have openly expressed reservations about the conditions that might be slapped on the island in return for financial assistance.
"Cyprus is facing the prospect of entering [a rescue] mechanism not because of the fiscal state of the economy, but because of the need to recapitalise Cypriot banks which have important exposure to the Greek economy," said the veteran communist.
"In every downgrade of the Cypriot economy, the exposure of our banks to Greece is portrayed as the main cause." In all other ways, the Cypriot economy was robust, he said.
"The economy of Cyprus continues to have healthy foundations despite the problems, distortions and inequalities accumulated over the years."
While refusing to stipulate just how much it will request in EU financial assistance, the Nicosia government asserted that the crisis-hit Mediterranean island would continue to pursue efforts to secure a bilateral loan outside the EU, either from Russia or China. "One doesn't preclude the other," said the government spokesman Stefanos Stefanou.
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