Gov’t asks Cyprus church to help secure Russian loan

FAMAGUSTA GAZETTE – 24/1/13

THE CYPRUS government appears to be seeking divine intervention in times of distress and has asked the head of the church to help secure a €5 billion loan from Russia.

Archbishop Chrysostomos will intervene on its behalf to the Church of Russia regarding a request by Cyprus for financial assistance from Moscow.

The primate of the church of Cyprus said on Thursday that the government had asked him to mediate towards the Church of Russia in order to intervene to the Russian government in an effort to secure a positive approach to the Cypriot request.

Archbishop Chrysostomos said that he communicated with the Russian Patriarch and asked him to visit the President of the Russian Federation to convey his request.

He also expressed optimism for a positive outcome of this attempt.

“The church is always at the government’s disposal”, the Archbishop said, expressing optimism about the future of the Cyprus economy.

Since the formal request for a second loan last year, Russia has appeared reluctant to help, given Nicosia’s ability to repay in the current circumstances.

On Tuesday, RT reported Russian Deputy Prime Minister Igor Shuvalov said Moscow could not afford to rescue European countries suffering from the debt crisis, without first thinking about its domestic needs.

“We need to be very frugal at the moment, very conservative,” Igor Shuvalov told Bloomberg.

According to Shuvalov, Russia is not prepared to write off a €2.5 billion loan granted by Moscow last November.

The loan was supposed to last three years, and earlier in January the Russian government announced it would consider granting loan concessions to Cyprus.

In December, President Vladimir Putin said that Russia would consider giving financial assistance to Cyprus as a part of international rescue package after the euro area takes a unified stance on aiding the island.

Cyprus applied on June 25 for financial assistance from the EU bailout mechanism after its two largest banks sought state aid to meet their capital requirements, following a massive write-down of their Greek bond holdings as a result of the Greek sovereign debt haircut and bad loans in Greece.

The Cypriot authorities and the Troika agreed last November on a fiscal adjustment programme. The Cypriot bailout is estimated to reach 17.5 billion euro.  — Copyright © Famagusta Gazette 2012

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