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Cyprus to be 'out and about' in bond markets in 2017 - finance minister
December 7, 2016 / 4:24 PM / a year ago

Cyprus to be 'out and about' in bond markets in 2017 - finance minister

LONDON (Reuters) - Cyprus plans to be “out and about” in bond markets next year, its finance minister said on Wednesday, after a successful first debt sale in July since its 2013 banking collapse and bailout.

Cyprus' Finance Minister Harris Georgiades attends an interview with Reuters in his office in Nicosia March 5, 2015. REUTERS/Yiannis Kourtoglou

Cyprus’ economy has begun to recover after the financial turmoil during the euro zone crisis and its exit from a three-year bailout in March was followed four months later by a 1-billion-euro bond sale.

In an interview with Reuters, that also touched on Cyprus’ unification hopes, Brexit negotiations and the clouds gathering over Greece again, Harris Georgiades told Reuters he was sizing up the bond markets again.

“There is nothing imminent and it is something that has to be decided but we shall be out and about on the markets,” he said.

July’s bond got Cyprus its lowest ever borrowing costs and smoothed out repayments that were threatening to bunch up, but it knows it will have to maintain regular market access if it is to fully pull clear of crisis.

It still has the largest problem-bank loans in the euro zone and needs to push through politically sensitive privatisations to further repair its finances.

It also has close ties with Britain through a large expatriate population and tourism and uncertainty is weighing over Brexit.

“I had a very productive meeting with Michel Barnier, the European (Brexit) negotiator a few days ago,” Georgiades said.

But “it is too early for anyone to provide any insight, we haven’t really seen the direction which we shall follow”, he said, referring to how hard a line the EU was likely to adopt in the exit negotiations with Britain.

The big issue for Cyprus, though, is talks to reunify the island. It was split in a Turkish invasion in 1974 triggered by a brief Greek-inspired coup and efforts to bring to two parts back together faltered again last month.

Another push now looks to be under way however, with talks between senior officials in Brussels on Wednesday.

Neighbouring Greece also remains an issue for Cyprus. There was disappointment this week after euro zone finance ministers agreed only minimal debt relief and the International Monetary Fund was still not part of the bailout programme.

“Some progress was made but more needs to be done,” Georgiades said.

“Everyone should acknowledge that Greece has to be brought back on a solid macroeconomic recovery and also to establish sustainable market access. That should be the guiding principle for all parties,” he said.

Editing by Louise Ireland

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