EC approves Cyprus' exit from its bailout program

Cyprus has implemented the economic adjustment program with positive results, European Commissioner Valdis Dombrovskis declared on Thursday after a round of meetings with officials here.

"I would emphasize the fact that Cyprus has implemented the program with clear determination and positive results," said Dombrovskis on the first day of a three-day visit.

Dombrovskis, who oversees the European Commission (EC)'s euro and social dialogue portfolio, is visiting Cyprus with the aim of finalizing Cyprus' program.

Cyprus is set to exit at the end of this month from its three-year economic adjustment program under a 10-billion-euro (11 billion U.S. dollars) bailout.

Dombrovskis said he would also discuss some direction of the future work to be done to keep Cyprus on the development track.

The Commissioner noted Cyprus had achieved an expansion of its 18-billion-euro annual economy by 1.5 percent in 2015, after about four years in recession and is projected to mark a further growth of 2.0 percent this year, according to EC projections.

"The economy is turning around, we see already a second year of economic growth," Dombrovskis said.

He added that according to the Commission's forecast, this trend would continue next year and Cyprus would also achieve a fiscal surplus of 0.5 percent.

As for the unemployment rate, it stood at 15.8 percent at the end of 2015 but dropped to 15.5 percent in January and was dropping further, while the state was addressing social challenges, Dombrovskis said.

Dombrovskis said after meeting labor minister Zeta Emilianidou that important reforms had been made in terms of the labor market, wage setting mechanisms, and the introduction of minimum guaranteed income scheme.

However, both Dombrovskis and Cyprus' finance minister Harris Georgiades said the end of the bailout program was not the end of the road.

"It is a new beginning for the further reform and streamlining of the Cypriot economy... far from the mistakes of the past," the commissioner said at a joint press conference with Georgiades.

He added that Cypriot President Nicos Anastasiades had renewed his commitment to continue the policy of reforms and disciplined spending.

Dombrovskis also hinted at a possible solution of the Cyprus problems in negotiations between the estranged Greek and Turkish Cypriot communities.

He said he discussed with Georgiades ways in which the European Commission could help so that a reunified Cyprus could effectively perform as a European Union and eurozone member.

He was also scheduled to meet Turkish Cypriot leader Mustafa Akinci. Endit