In this first evaluation since Cyprus’ exit from the MoU, it will be revealed that Cyprus still has a long way to go to satisfy the Troika obligations, and to surpass the political obstacles in the House of Representatives.

Technical teams from the European Commission, the European Central Bank and the International Monetary Fund will examine the implementation of commitments taken up by the Cyprus Republic in the reform and finance sectors.

The meetings will include a briefing by Minister of Finance Harris Georgiades and the Central Bank of Cyprus. The technical teams of the Troika conduct teleconferences on a frequent basis with Cypriot technocrats, so they are unlikely to be surprised by their findings.

One of the largest open issues is the matter of state employee salaries, and the reform of the public sector. There are significant political obstacles for the government before it can pass a new policy on salaries.

This bill is considered very important for the government to convince foreign credit agencies that the fiscal clean-up will be ongoing, as it caps the percentage of salary increases in the public sector, tying them to increases in the nominal GDP.

Source: InCyprus