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ECOFIN removes Cyprus from excessive deficit process
2006-07-11 16:14:52

by Nicos Bellos

Brussels, Jul 11 (CNA) - ECOFIN decided today, at the suggestion of the European Commission, to revoke the excessive deficit process, which had been activated for Cyprus in 2004. The Council accepted the Commission's position that Cyprus had managed sustainable fiscal corrections, restoring the deficit below the 3% GDP ceiling.

Cypriot Minister of Finance Michalis Sarris, who participated in today's ECOFIN meeting, received the praises of his counterparts, the Finnish presidency and the Commission, who noted that Cyprus' efforts were effective.

Commissioner for Economic and Monetary Affairs Joaquin Almunia said Cyprus was a paradigm to be copied, since it is the first of the new EU countries that is taken out the excessive deficit process, adding that if a country has the political will, it can achieve much in a very short time.

ECOFIN notes in its conclusions that the deficit has dropped from 4.1% to 2.4%. The Commission projects that the deficit will drop to 2.25% in 2006 and to 2% in 2007.

Referring to today's development, Sarris said the result was based on permanent measures, adding that the implementation of the national programme for the Lisbon Strategy will contribute to maintaining high growth rates.

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