Cyprus Bailout: 'Near Future Will Be Very Difficult' Warns EU's Olli Rehn

Category: Markets / Finance / Mar 25, 2013 11:17AM EDT
Down to the wire, Eurozone finance ministers approved a Cyprus bailout plan to spare the country from financial meltdown. "The program will be based on ambitious measures in areas of fiscal consolidation, structural reforms and privatization. The authorities will also take decisive action to safeguard the stability of the financial sector, including bank resolution and deep restructuring measures concerning the two largest banks. A levy on deposits across the whole banking sector can and will therefore be avoided," said Eurogroup Chairman Jeroen Dijsselbloem. "The instruments that we are choosing now could have been chosen a week ago, but they could not have chosen a week ago, because there simply wasn't a political possibility to reach that agreement. So, within the political possibilities last week, we chose different instruments and now we have the better solution, in worse circumstances, I am sorry to say," Dijsselbloem said. "I expect to be in the position to make a recommendation to the IMF executive board in the coming weeks, and that recommendation will aim at including the financial participation of the IMF," said Christine Laguarde, President of the International Monetary Fund. "It is clear that the depth of the financial crisis in Cyprus means that the near feature will be very difficult for the country and for its people. The Commission will do everything possible to alleviate the social consequences of this economic shock and help protect the most vulnerable people," said Olli Rehn, the EU Commissioner for Economic and Monetary Affairs. (Video Source: REUTERS)