ESM hails "the euro area's latest success story"
Cyprus has officially concluded its three-year financial assistance programme with the European Stability Mechanism (ESM) today.
In the end, the Cypriot government availed of €6.3 billion, as well as €1 billion in loans from the IMF. It did not need the remaining €2.7 billion of a potential €10 billion loan package.
ESM Managing Director Klaus Regling lauded Cyprus' approach to the programme and its ahead-of-schedule completion, calling it "the euro area's latest success story".
"I congratulate the government and people of Cyprus for their achievements over the last three years.
The country has managed to restore economic growth and repair public finances much faster than expected. Cyprus’s financial sector – which was the main source of the crisis – was restructured, recapitalised and downsized, and the legal and supervisory framework was modernised.
The country regained the trust of investors and returned to the bond market, where it continues to finance its debt at sustainable rates.
The end of the programme is not the end of the reform agenda in Cyprus. More efforts are needed to reduce the non-performing loan ratio, continue labour market reforms, and maintain fiscal discipline".
The nine loan tranches disbursed from May 2013 to October 2015 will be repaid from 2025 to 2031.
Cyprus follows Ireland, Spain and Portugal to become to fourth country to exit an EFSF or ESM programme without requesting further financial assistance.
The ESM will continue to receive regular reporting from Cyprus and will join the European Commission twice a year for its post-programme surveillance missions.