Cyprus must do more to combat money laundering, Schaeuble says

European finance chiefs told Cyprus’s government that it must do more to combat money laundering before it can hope to win an international bailout, German Finance Minister Wolfgang Schaeuble said.

A gathering of European finance ministers in Brussels conveyed the message “intensely” to their Cypriot colleague, Vassos Shiarly, that “they have to do some more to convince the international community they not only have passed the money laundering laws, but that they’ve also implemented them,” Schaeuble told reporters Tuesday at the meeting’s end.

“It’s of decisive importance” that the Cypriot government bring clarity on money laundering, Schaeuble said. “It was a very intense debate and I hope that the Cyriot colleague has understood that.”

Cyprus is still awaiting a decision on outside aid eight months after it made a request, with some members of Chancellor Angela Merkel’s government questioning the need to help the Mediterranean island nation representing just 0.15 percent of euro area output. Schaeuble’s ministry has said Cyprus isn’t eligible for aid unless it threatens contagion and hence the stability of the entire euro region.

In Europe, “we all fully agree that work on Cyprus has to be driven forward,” Schaeuble said. “But on the other hand we know that there are elections in Cyprus and that no decisions can be taken before the election.”

Presidential elections are due to be held in Cyprus on Feb. 17, with a run-off on Feb. 24 if no candidate wins an outright majority. [Bloomberg]

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