Cyprus Parliament Rejects Privatization Bill Jeopardizing Bailout

International efforts to bail out Cyprus’ debt-laden economy have been thrown into doubt after its parliament rejected a key part of the plan.

As part of the 10bn-euro (£8.25bn; $13.7bn) deal with the EU and International Monetary Fund, lawmakers have until 5 March to pass a bill allowing state firms to be privatised.

But on Thursday, they threw it out, jeopardising the next tranche of cash.

The government says it will re-submit the bill with some amendments.

The deal was agreed in March last year in an attempt to stave off the collapse of Cyprus’s banking sector and the wider economy.

It included moves to restructure the banks, along with other measures such as tax rises and privatisations.

Late on Thursday, the privatisation bill was narrowly defeated after parliament split 25-25 on the vote, with five abstentions. This meant the legislation failed to pass.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza