ECONOMY

In Brief

VAT decision to help real economy in Cyprus Cyprus’s decision to cut the amount of time the island’s 81 largest companies have to pay value-added tax will further support the «real economy,» the Ministry of Finance said. «The measure for quicker collection of the owed VAT from really big companies will reinforce public finances,» the Nicosia-based ministry said in an e-mailed statement yesterday. «This will allow the government to continue to support the real economy and average citizen.» The window of payment is being cut from four months, 10 days to two months, 10 days, which will speed up the state’s collection of 50 million euros ($73.9 million), the ministry said. Cyprus’s economy will shrink 0.5 percent this year, down from a May forecast of a 1 percent growth rate, as the world slowdown dents the east Mediterranean island’s tourism and real estate industries, Finance Minister Charilaos Stavrakis said on September 12. (Bloomberg) Growth of Bulgarian debt slows in July SOFIA (Reuters) – Growth of Bulgaria’s gross foreign debt slowed to 6.4 percent year-on-year in July as banks curbed lending, central bank data showed yesterday. The debt, which has made Bulgaria more vulnerable in the global financial crisis, rose to 36.3 billion euros ($53.46 billion), or 107.2 percent of gross domestic product at the end of July. But that was down 0.9 percent from a month earlier, as tighter global liquidity made commercial banks more vigilant and limited lending. A year ago, the European Union member’s foreign debt had risen 39.7 percent on an annual basis and economists say its huge current account deficit has undermined its ability to ride out external shocks as the global downturn unfolds, cutting investment inflows. But gross private debt dropped 1.1 percent to 32.2 billion euros last month and public and publicly guaranteed external debt rose 0.4 percent to 4.1 billion euros, the data showed. The new center-right government of the GERB party, which won July general elections, has pledged to keep fiscal policy tight and avoid tapping international markets or seek external financing to back up its public finances this year. It has already cut public spending by 15 percent to avoid an end-year budget deficit that may put pressure on Bulgaria’s currency board regime and lev currency peg to the euro. Athens-NY flights Continental Airlines will resume direct flights between Athens and New York as of May 28, 2010, the company said yesterday. There will be five flights a week to Newark Liberty International Airport until September 6, and four per week thereafter. Bad loans Erste Group Bank AG’s nonperforming loans from the Czech Republic to Romania have peaked and may decline from the middle of next year as the lender’s key markets recover, CEO Andreas Treichl said. «We don’t expect them to increase,» Treichl said yesterday in a phone interview from Vienna. The level «we’ve seen in the last two quarters, we’ll probably see for a number of quarters. In mid-2010, we might see an improvement.» (Bloomberg)