- failed mission : Iran defiant as UN nuclear talks fail
- austerity : French Socialists dig in heels on EU austerity
- gangster violence : Sweden's ‘Chicago’ grapples with deadly wave of shootings
- Cyprus : Cyprus EU presidency enlists world's fastest yacht
- brussels : Christofias begins contacts in Brussels
- death : Two western Journalists killed in Syria
- bank of cyprus : BoC takes €1 billion hit on Greek debt
- Apostolos Andreas : Our View: Petty disputes have no place in restoration of...
- bills : Bill to sideline the executive on gas going to a vote
- benefits : Mountain dwellers plan to protest cut in fuel allowance
Second tranche of Russian loan delivered
THE government said yesterday it has secured the second tranche of a €2.5 billion bilateral loan from Russia to cover its financing requirements this year.
The Republic received a €1.32 billion instalment, the finance ministry said, following the €590 million it received in December.
The third tranche, also €590 million, will be disbursed at the end of March.
Part of the amount would be used for bond redemptions falling due in coming months.
Effectively shut out of international capital markets since last May, Cyprus was the first eurozone country to tap bilateral borrowing instead of resorting to a bailout.
Yields on its traded bonds have made it too costly to borrow from conventional markets as its credit ratings have been slashed over the past 18 months as Europe's debt crisis took its toll.
Standard and Poor’s recently downgraded the island to ‘junk’ while the other two ratings agencies – Moody’s and Fitch -- are expected to complete their evaluations soon.
Finance Minister Kikis Kazamias said they were providing the two agencies with comprehensive information on the economy, the banks, and developments following the discovery of natural gas in a bid to avoid a repeat of the S&P action earlier this month.
A big role in the downgrades is played by the banking sector’s heavy exposure to the troubled Greek economy.
The agencies say the island’s two big banks may need financial support, which the state may not be able to provide.
Kazamias said the banks did not need help to respond to the challenges posed by the 50 per cent haircut in Greek bonds.
“I judge that as things stand at this moment, the banks are in a position to respond on their own and resolve any questions and demands,” he said.
Kazamias added that “this is the assessment we have at the finance ministry, which is not only ours, but you realise I am not authorised to speak on behalf of anyone else.”
Cyprus has already put austerity measures in place in a bid to rescue its ailing economy and the ministry is now working on ways to boost growth.
Kazamias said processing the measures will be completed today and by next Tuesday they are expected to be submitted before the cabinet.
Before that, the measures will be discussed with political parties, he said.
