Apr 12, 2013

Cyprus To Appeal For Extra Help

Portugal and Ireland are to be granted an extra seven years to pay back their emergency bailout loans.

The European Union and the IMF bailed out the Republic of Ireland in 2010 and Portugal in 2011.

The 17-member group that uses the euro currency agreed to the terms at a meeting of finance ministers in Dublin.

Meanwhile, the ministers also said a 10bn euro ($13bn; £8.5bn) EU bailout loan for Cyprus was ready for approval by member states.

That could happen by the end of the month and, if the IMF also gives the go-ahead, the first bailout money could be released by mid-May.

The plan for Ireland and Portugal is intended to give the countries' financial systems more time to recover from the debt crisis after their bailout loans run out.

Ireland's bailout money will run out later this year, and Portugal's will run out in 2014.

The Irish and Portuguese repayment extensions are expected to be backed by all 27 European Union members, which includes those outside the eurozone, later on Friday.

While confirming that up to 10bn euros in loans will be provided to Cyprus, the eurozone finance ministers also rejected reports that the country might be granted more financial assistance.

Earlier on Friday, Cyprus president Nicos Anastasiades had said he would appeal for extra assistance from the European Union.

On Thursday, it emerged that Cyprus would need to raise an extra 6bn euros to secure the 10bn euro bailout from Brussels and the IMF.

A draft document prepared by the country's creditors said the cost of the rescue had risen to 23bn euros from 17.5bn euros, with Cyprus now having to find 13bn euros of this.

A Cypriot official in Dublin told BBC economics correspondent Andrew Walker that for its part, Cyprus was not seeking more bailout money, but was seeking help from the EU to reduce the burden of the conditions to make the bailout possible.

Source: BBC News


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