| Author (Corporate) | European Commission |
|---|---|
| Series Title | COM |
| Series Details | (2013) 626 final (6.9.13) |
| Publication Date | 06/09/2013 |
| Content Type | Policy-making, Report |
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On 13 July 2010, the Council decided that an excessive deficit existed in Cyprus and issued a recommendation to Cyprus with a view to bringing an end to the situation of an excessive government deficit by 2012. On 27 January 2011, the Commission (following an assessment of action taken by Cyprus) concluded that, on the basis of information available at the time, Cyprus had taken action representing adequate progress towards the correction of the excessive deficit within the time limits set by the Council. On 11 January 2012, the Commission confirmed that Cyprus had taken effective action in compliance with the Council Recommendation of 13 July 2010 to bring its government deficit below the 3% of GDP reference value and considered that no additional step in the excessive deficit procedure was therefore necessary. On 25 April 2013, the Council addressed a decision to Cyprus on specific measures to restore financial stability and sustainable growth. In parallel the European Stability Mechanism (ESM) granted a financial assistance facility to Cyprus. In this context, a Memorandum of Understanding on Specific Economic Policy Conditionality (MoU) was signed on 26 April 2013 by the Cypriot authorities and the Commission, acting on behalf of the ESM. On 16 May 2013 the Council concluded that effective action had been taken but that unexpected adverse economic events with major unfavourable consequences for government finances had occurred after the adoption of the recommendation in 2010, making the time limit set by the Council in July 2010 for the correction of the excessice deficit no longer achievable. The Council therefore adopted a revised recommendation extending the deadline for the correction of the excessive deficit to 2016. The Council Recommendation of 16 May 2013 was based on the Commission 2013 Spring Forecast. The current assessment of effective action taken is based on the updated fiscal and macroeconomic projections in the context of the July review of Cyprus' programme. It takes into account the economic and budgetary developments since the revised recommendation under the Excessive Deficit Procedure (EDP) was issued. |
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| Source Link | http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2013:626:FIN |
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| Countries / Regions | Cyprus |
