The Slovak Finance Ministry welcomes the consensus on the financial aid for Cyprus reached on Monday. “The agreed approach should prevent the uncontrolled default of the biggest Cypriot banks. It rejects any across-the-board levy or tax that could have an adverse effect on the safety of deposits up to €100,000. On the other hand, this proposal cuts off the link between the state and banks Laiki and Bank of Cyprus, as the aid resources equalling up to €10 billion won't be used for the recapitalisation of these banks. This will work to significantly reduce the future risks of the programme,” said Finance Ministry press department head Radko Kuruc.
In cooperation with the International Monetary Fund, the European Central Bank and European Commission, Cyprus has to prepare a draft memorandum based on which it will be possible to allocate the financial resources of the European Stability Mechanism (ESM) to its aid. “Slovakia will agree to this use of financial resources only under the condition that Cyprus commits itself to exchange information with us about Slovak individuals and companies registered there in order to avoid paying taxes in Slovakia,” said Kuruc.
Slovak economic analysts are a bit more cautious in their statements. “We will see what will be the impact on the euro as a currency. It might happen that citizens of the South European countries and the capital existent there will not trust the euro anymore in which case the currency gets into troubles again,” says Matuš Pošvanc, an analyst with F.A.Hayek Foundation. Juraj Karpiš from the Bratislava based think-tank INESS agrees that Spaniards can be worried by what has happened in Cyprus: “Their banks are in a very bad shape and the last thing they need is for clients to have a run on them because of panic.”
Anca Dragu
