IMF: Cyprus making good progress on program

The International Monetary Fund said Cyprus’s economic adjustment program was on track, but that vigilance was needed because of deep uncertainties ahead.

“This review found the program to be on track, with authorities having made good progress towards meeting their objectives,» IMF Mission chief Delia Velculescu said on Wednesday during a conference call closing a mission to Cyprus.

Lenders from the EU, the ECB and the IMF, known as the troika, wrapped up their first assessment visit to the Mediterranean island since it agreed to a 10 billion euro bailout package in March.

Their report is key to Eurozone finance ministers unlocking a further tranche of aid of about 1.5 billion euros to Cyprus in mid-September.

Velculescu said fiscal measures introduced by Cypriot authorities in December 2012 and in April 2013 led to a ‘better fiscal performance measured up against program targets’.

But high uncertainty remained for the macro economic outlook which called for continuous fiscal prudence, she said.

“Available indicators do not indicate that a revision to the macro economic projections underlying the program are warranted at this time, however uncertainty remains large,» she said.


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