KT 3-4-2013_Layout 1 - Kuwait Times

Business
WEDNESDAY, APRIL 3, 2013
Chinese tanker loads
Iran oil, first since July
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Record unemployment
clouds euro-zone hopes
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UAE strategic hub for foreign investments Page 26
NICOSIA: Finance Minister Michalis Sarris resigned yesterday,
hours after a judicial probe was launched into
how Cyprus was pushed to the verge of bankruptcy
before having to agree a crippling euro-zone bailout. He
said he was stepping down as he would need to cooperate
with judges probing the failure of Laiki Bank, of
which he was chairman for much of last year. The bank’s
collapse was a major contributor to the island’s near
financial meltdown.
President Nicos Anastasiades accepted his resignation
with “sadness” and lauded his “high political ethos”
for stepping down to facilitate the probe. The president
named current labor minister, 40-year-old economist
Haris Georgiades, to replace Sarris, spokesman Christos
Stylianides said.
Zeta Emilianidou, permanent secretary at the commerce
ministry, becomes the first woman in the cabinet,
taking over Georgiades’s post, Stylianides added.
Meanwhile, the government wrapped up talks with
international lenders that will open the way for Cyprus
to receive a 10-million euro bailout, Stylianides said.
“Today we have completed the forming of the memorandum,
which is a precondition for the loan agreement,”
he said, adding that the period to implement the
deal was extended by two years to 2018 to “ease pressure
on the economy.” And the central bank announced
an easing of capital controls imposed last week, raising
the limit on business transactions from 5,000 euros to
25,000 and allowing people to issue cheques of up to
9,000 euros.
With public anger mounting, the government set up
a judicial inquiry on Tuesday into the banking collapse.
Anastasiades called on the three-judge commission-
George Pikkis, Panayiotis Kallis and Yiannakis
Constantinides-to investigate himself and his family
members as a “matter of priority” and with “extra vigour”.
This is seen as a move to counter unsubstantiated
allegations that his relatives used privileged information
to get money out of the country before deposits were
locked down. Accusations have also been made against
other leading politicians and business figures that they
took advantage of their position to protect their assets
from a hit on bank deposits imposed by EU-led creditors
last month. Anastasiades said nobody was immune from
the inquiry, not even his extended family or the law firm
in which he was a partner until recently. “A series of acts
or omissions from those authorized to manage the
economy or the banking system led the country to the
brink of bankruptcy, the dissolution of one its largest
banks and the loss of billions from an impairment of
deposits,” Anastasiades said at the swearing-in ceremo-
ny. The massive losses suffered by savers in the island’s
two largest banks in the first euro-zone rescue package
to punish larger depositors has sparked huge resentment
against anybody seen as having taken unfair
advantage to shirk their share of the burden.
The president lauded what he said was the “high
political ethos and political sensitivity” reflected by
Sarris’ resignation, which he said “constitutes a phenomenon
of a new approach with regard to what is happening
in the Cypriot political life.” Central bank official
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Cyprus finance minister quits
Probe to unravel causes of crisis, bailout
MOSCOW: Cyprus’ Finance Minister Michalis Sarris (center) leaves after his meeting with Russian Finance Minister Anton Siluanov at the building of Russian Finance Ministry in
Moscow. —AP
Yiangos Demetriou told state radio meanwhile that
savers in the island’s largest lender, Bank of Cyprus,
would also be able to access 10 percent of their deposits
over 100,000 euros.
But he added that the representatives of the troikathe
European Central Bank, the European Union and the
International Monetary Fund-had asked for more information
before agreeing to release the full 40 percent of
deposits over that threshold that savers can be sure of
retaining. — AFP