A member of the European Central Bank’s executive has revealed that he believes an aid package for Cyprus could be ready by as soon as the end of March.
Jorg Asmussen told German newspaper Handelsblatt ; “I expect the aid programme for Cyprus to be in place by the end of March. There must be no doubts about this: if Cyprus gets no external help, it will slide into default.”
The small island nation’s possible bailout has sparked controversy amongst the EU members. Politicians in Germany are hesitant about granting the funds because of its status as a tax haven for rich Russians, many of whom use it for money laundering or criminal activity.
Finance ministers are due to gather in Brussels later today to discuss the terms of the €17 billion bail-out. Negotiations over Cyprus’s needed bailout began last November, and it is thought that the island’s banking sector alone will need €10 billion to stay afloat.
Despite their concerns, the German member of the ECB’s executive board highlighted the risks of letting Cyprus go under. “There must be no doubt about this: if Cyprus gets no external help, it will slide into default … putting at risk progress made last year on the euro crisis – and that would have high financial and political costs.”
Today’s talks are expected to focus on burden sharing and decide who will foot the bill for bank losses which emerge after it comes under the supervision of the ECB and appears on the balance sheet of the EU’s bailout fund, the European Stability Mechanism (ESM).
Under the ESM treaty agreed by EU leaders in 2011, the bailout fund has access to €500 billion.
Euro Exchange Rates
As of 11:00 pm
The Euro to Pound Sterling exchange rate is currently trading in the region of 0.8522
The Euro to US Dollar exchange rate is currently trading in the region of 1.3402
The Euro to Australian Dollar exchange rate is currently trading in the region of 1.3043
The Euro to New Zealand Dollar exchange rate is currently trading in the region of 1.6108
The Euro to Canadian Dollar exchange rate is currently trading in the region of 1.3487
The Euro to Emirati Dirham exchange rate is currently trading in the region of 4.9222
The Euro to Swiss Franc is currently trading in the region of 1.2272
The Euro to Japanese Yen exchange rate is currently trading in the region of 124.9762
