EIB’s Hoyer says unemployment still high in Cyprus despite “progress” (Update-1)

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(Adds Hellenic Bank comment in sixth paragraph)

By Stelios Orphanides

The president of the European Investment Bank (EIB) Werner Hoyer said that while Cyprus’s economy “made huge progress” following the financial crisis of 2013, the unemployment rate remains high and much remains to be done.

“Obviously the rate of unemployment is still much too high, this is obvious but the situation is recovering well,” Hoyer told reporters on Monday after meeting President Nicos Anastasiades in Nicosia.

The banker who is in Cyprus to sign €50m loan guarantee agreement with Hellenic Bank to finance small and medium size enterprises and mid-capitalisation companies at low-interest rates said that the European Union’s bank already exceeded its financing target for Cyprus by €30m raising it to €230m. “We will stay after the crisis and even continue and increase our business,” he said.

“It was a very good year and in addition to that for the so-called Juncker plan, investment plan for Europe in the last year we had the first big programme in Cyprus,” Hoyer said in reference to the European Fund for Strategic Investment named after the chairman of the European Commission Jean-Claude Juncker. “Cyprus is now one of the all 28 countries in which the Juncker plan is active. So, it was a very good opportunity to exchange views”.

Cyprus’s unemployment rate stood in January at 14.1 per cent, which is the third highest in the EU, compared to 13.1 per cent in January 2016, according the EU’s statistical office Eurostat. The economy is projected to have expanded 2.8 per cent last year compared to 1.7 per cent in 2015, helping the government generate a slight fiscal surplus.

hellenic-702x336In an emailed statement, Hellenic Bank said that following the signing of the agreement with the EIB, the bank will extend loans worth €66.7m as the bank will add further €16.7m in own funds.

“Hellenic Bank’s aim is the support of the economy and the financing of enterprises in basic branches such as industry, energy, tourism, healthcare and communications,” the Cypriot bank said.

The deal was signed by Hoyer, the chairwoman of Hellenic, Irena Georgiadou, and the permanent secretary of the ministry of finance Christos Patsalides.

Georgiadou said that since September 2014, Hellenic extended in cooperation with EIB a total of €166.7m in loans to Cypriot companies.

 

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Stelios Orphanides is a journalist at CyprusBusinessMail.com. To contact Stelios Orphanides: stelios@cyprus-mail.com