AKEL on the level of private debt in Cyprus
Statement by Charis Polycarpou, member of the C.C. of AKEL
AKEL C.C. Press Office, 4th May 2017, Nicosia
Figures released by the Central Bank of Cyprus reflect the difficult position of households in Cyprus due to their increased borrowing obligations. Total household debt exceeds € 22 billion in an economy with an annual output of just € 18 billion.
Cypriot households today find it hard to cover their loans since they are forced to pay the greater part of their income to repay their installments. At the same time, the uncertainty over pension benefits, the nonexistence of a General Health Scheme and the absence of adequate social protection generate even more uncertainty and make the management of private debt more difficult.
Unfortunately, the Government is content with making empty wishes and issuing recommendations to the Central Bank and banks when it comes to providing support to borrowers. On the other hand, when it comes to giving new tools to the banks it shows an increased zeal and has no problem to turn against borrowers.
AKEL calls on the government to study ways of supporting not banks alone, but also borrowers. It should proceed with measures to boost household incomes instead of pursuing policies to reduce wages and salaries, particularly in the private sector. Finally, it must realize that the dismantling of the welfare state is not only socially, but also economically unbeneficial.
