AKEL ON STATEMENTS BY OLI REHN AND RUSMUSSEN
AKEL C.C Press Spokesman Georgios Loucaides
EU Economic and Monetary Affairs Commissioner Olli Rehn and NATO Secretary-General Anders Fogh Rasmussen under sharp criticism from Members of the European Parliament about the way the Troika chose to “rescue” the Cyprus economy, put forth various excuses to justify what is unjustifiable. Although they correctly referred to the very bad situation of the financial sector in Cyprus as the reason for the country’s problems, at the same time they couldn’t in any way explain how the recipe of the destruction of the financial sector and the economy, which they imposed coercively, is viewed as a rescue. Neither could they provide any explanations why it wasn’t at all taken into account that the Cypriot banks underwent a haircut on the Greek bonds that reached 25% of Cyprus´ GDP. In addition, they also didn’t avoid the biggest contradiction, namely that on the one hand they declare that the European Central Bank only provides support to sustainable banks, whilst at the same time claiming that the Popular Bank, with less Emergency Liquidity Assistance in March 2013 in comparison to July 2012, wasn’t sustainable.
Furthermore, in their attempt to shake off their responsibility for their own actions and decisions which they took with the consent of the Anastasiades government, which anything but were within the spirit of community solidarity, through political criteria they tried to shift the responsibility on the previous government by promoting various unsubstantiated allegations.
With regards the reference that it was the delay in the conclusion of the memorandum which imposed the recipe that was enforced, as the situation of the banks supposedly worsened, the evidence proves otherwise. Namely, that from last July until 15th March 2013 the Troika was constantly referring to 17 billion Euros of assistance to Cyprus. What did change suddenly on 5th March 2013 was the Troika’s completely new demand for a bail-in by internal means and not a bail-out by external means, indeed in an unprecedented way which has never before been implemented, that is to say the haircut on all the deposits without exception.
Regarding the position about a delay in the signing of the memorandum by the previous government, this is refuted by the developments themselves, since as from November onwards and despite the conclusion in principle of an agreement for the memorandum, the IMF, Germany and the Troika deliberately delayed the signing so that a new President would be elected cooperative and accommodating for them, as they themselves were saying, but also because they had disagreements with the agreement in principle, as the German Deputy-Minister revealed in a letter replying to a Member of the German Bundestag of the Left Party.
Finally, Olli Rehn and Rasmussen are right when they say that the previous government sought solutions to avoid the Stability Mechanism and the program. However, developments themselves have fully vindicated it, given that the events of 15th and 25th March proved that no country can have any trust in the Troika and in the disastrous recipes it is imposing in an undemocratic way.
