Russia could take Cyprus loan decision as early as end of 2011

 

RUSSIA will decide on going ahead with a long-term loan to Cyprus no earlier than the end of 2011, Deputy Finance Minister Sergei Storchak said late on Thursday.  

“We will reach final agreement probably no earlier than at the end of the year,” Storchak told journalists on the sidelines of the International Monetary Fund/World Bank fall meeting in Washington DC.  

Earlier this month, Cyprus said it was in talks with Russia for a loan of up to €2.5 billion, aimed at alleviating its budgetary strains and outstanding debt burden.  

“The volume will depend on the needs of the borrower,” Storchak said. “Calculations will be made virtually at the last moment, when we sign the agreement.”  

Cyprus has around €1 billion in debt maturing early next year, and its current high yields have fanned speculation it could be a candidate for an EU bailout because its borrowing options seem limited.  

Interest on the loan is said to be 4.5 per cent.

Cyprus is a leading offshore centre for Russian capital and finance, and ranks in official statistics as the largest source of foreign direct investment into Russia. 

Most of that investment capital is Russian in origin, financiers say.

 

The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.