|No handout deal yet for indebted Cyprus
Cyprus, the next euro zone bailout candidate after Greece, Ireland and Portugal, is unlikely to get a rescue accord agreed this month, eurogroup head Jean-Claude Juncker said.
The 17 euro zone finance ministers are due to meet on January 21 and and the single currency group will “not be in a position to [reach a] solution,’’ this month, Juncker said, adding: “It will take longer.’’
German Chancellor Angela Merkel said on Wednesday that Cyprus would not be allowed any exceptional terms as it seeks a bailout worth 17 billion euros, with talks likely to continue for some time, AFP reports.
“There are no special conditions for Cyprus ... We have generally accepted rules in Europe and we are a long way from finishing the negotiations,'' Merkel said.
Cypriot Finance Minister Vassos Shiarly was expected to hold talks with EU diplomats today to thrash out the possible terms of a bailout that would be equivalent to an entire year's output for the tiny island economy.
German finance ministry spokesman Johannes Blankenheim said that the January 21 meeting would serve to provide “a basis for further discussion,’’ but noted that decisions were unlikely.
“When financial markets are nervous, the bankruptcy even of a small country can lead to negative contagion effects. We must bear this in mind,’’ Blankenheim added.