Cyprus Mail www.cyprus-mail.com
Tuesday, May 14, 2013
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EU releases first ¤2b in bailout aid Eurogroup studies two anti-money laundering reports, pushes action plan By Stefanos Evripidou
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HE EUROGROUP gave its blessing to the disbursement of €3 billion to Cyprus yesterday, with the first €2 billion already sent to the island as part of the first tranche of a €10 billion bailout expected to “buy time” for its ailing economy. The group of eurozone finance ministers met for nearly six hours in Brussels yesterday, discussing among other things the bailout programmes of Cyprus and Greece and the troika’s assessment of Cyprus’ antimoney laundering measures. During the first hour of the Eurogroup meeting, the European Stability Mechanism (ESM) board announced its approval of the Financial Assistance Facility Agreement with Cyprus and the disbursement of the first tranche of ‘rescue’ money worth €3 billion. The first tranche will be transferred in two separate disbursements: the first €2 billion was transferred yesterday, while the remaining €1 billion will be transferred before June 30. Both disbursements will be made in cash, and will be used for the general financing needs of the public sector, including the considerable sum of maturing debt the government is expected to pay next month, and the country’s fiscal needs. “The loans granted by the ESM help to maintain financial stability in the euro area and buy time for Cyprus,”
Robber shot three times by police officer By Peter Stevenson A KNIFE-WIELDING suspected robber was critically injured early yesterday after being shot three times by a plain clothes police officer at a bakery in Lakatamia. According to head of Nicosia Police Kypros Michaelides, the officer who was patrolling in his car outside the bakery, noticed a suspicious looking man with a knife enter the bakery and attempted to stop him. Police said the man, a 34year-old Greek Cypriot from Nicosia, attacked the policeman who was forced to use his gun to defend himself, shooting the thief once in the foot, once in the chest and once in the head. The injured man was taken to Nicosia General Hospital where he was operated on. He is in critical condition and in the Intensive Care Unit. According to police reports, the officer had initially asked the man to surrender and give up his weapon. The 34-year-old, who has not been named, allegedly refused to stop and the officer was forced to shoot him in the foot as a warning. Despite the policeman’s repeated demands that the suspect drop his knife, he refused to do so, resulting in the officer having to shoot him again, once in the chest and once in the head, police said. The incident was witnessed by the bakery’s cashier whose statement police will examine during their investigations along with CCTV footage from the scene. Justice Minister Ionas Nicolaou expressed his sadness over the incident and told reporters yesterday that he
Klaus Regling, Managing Director of the ESM said. “This time enables Cyprus to undertake the reforms necessary to rebuild its economy on a sustainable basis.” In accordance with the Eurogroup decision on March 25, Cyprus will receive assistance of up to €10 billion during the next three years. Cyprus signed a Memorandum of Understanding (MoU) with the European Commission containing many reforms demanded of the government in exchange for the loan at the end of April. Compliance with the MoU will be reviewed every three months before the next tranche is disbursed, with the first review likely to be in September. Repayment of the loan will begin in ten years’ time and have a maximum maturity of 20 years while the interest paid will likely be between 2 and 3 per cent, depending on the ESM’s costs. No portion of the €10 billion can be used to recapitalise the island’s biggest bank, Bank of Cyprus or Laiki, whose losses were considered too big to be covered by the EU. Instead, €3.4 billion of the funds will be used to cover Cyprus’ fiscal needs, €4.1 billion to redeem its medium and long-term debt, and €2.5 billion for the recapitalisation of Cyprus’ other banks. Cyprus is not only the first fully fledged macro-economic bailout financed by the ESM, it is also the first country forced to contribute
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Police officers investigate the scene of the bakery shooting
(Christos Theodorides)
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