Cyprus’s Finance Minister Michalis Sarris says there has been “significant progress” in talks with EU-led creditors.
He was speaking in Cyprus after meeting representatives of the International Monetary Fund (IMF), the European Central Bank (ECB), and the European Commission — collectively known as the troika.
“There has been significant progress for a solution at least on the level of the troika, which will make its own suggestions to the Eurogroup. During the discussions certain issues arose that will require further study,” Sarris said.
The talks in the Cypriot capital centered on a proposal to impose a one-time charge on savings held at the Bank of Cyprus, the island’s biggest lender.
Sarris said it was unclear when new legislation raising funds would be completed and put to a vote in parliament, but that it could be as early as the evening of March 23.
Politicians in Cyprus are racing to complete an alternative plan for raising funds necessary for the country to qualify for an international bailout after lawmakers rejected an unpopular initial plan that would have seized up to 10 percent of people’s bank accounts.
Cyprus has been told it must raise 5.8 billion euros in order to secure 10 billion euros in rescue loans from other European countries that use the single currency, and from the IMF.
The European Central Bank has warned it will stop providing emergency funding to Cyprus if a new plan for handling the country’s debt has not been agreed on by March 25.
Without ECB’s support, Cypriot banks would collapse on March 26, pushing the country toward bankruptcy and a potential exit from the 17-nation eurozone.
The Cyprus crisis is expected to be discussed at a euro-zone finance ministers’ meeting in Brussels on March 24.