Regions

Eurozones finance ministers to discuss Cyprus bailout

April 12
9:36 AM 2013

Eurozones finance ministers will meet in Dublin on Friday  to discuss a bailout for Cyprus, the cost of which has rise to 23 billion euros from 17.5 billion euros.

The bailout is being put together by the European Union and the International Monetary Fund.

The ministers will also review how Cyprus can raise its contribution. In order to secure 10 billion euros from the EU and IMF, Cyprus should raise the remaining 13 billion euros, about 6 billion euros more than what was previously estimated.

Various options are being considered to raise the amount. According to a Cypriot government spokesman, one fundraising option being considered was the sale of some of the country's gold reserves.

Cyprus faces a huge challenge with the increase in the cost of the bailout, according to analysts.  Chief European economist at Capital Economics Jonathan Loynes noted that the "biggest burden of the increase in the bailout will fall on depositors and bank bond-holders, whose combined contribution will rise from an expected 5.8 billion euros to 10.6 billion euros."

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