ONE OF Louis Vuitton sac Cyprus' most senior civil servants yesterday likened his country's treatment by Germany and the IMF to the shooting of a pigeon with an atomic bomb, saying they had destroyed an economic system that worked.
Christos Patsalides, permanent secretary of the Ministry of Finance, was speaking to a committee inquiry which launched a public hearing yesterday into the circumstances that led to the countryâs economic meltdown.
He described the international lenders as "forces of occupation" that cared nothing for human Hermes Kelly Wallet Golden rights.
Patsalides took part in the recent bailout negotiations between Cyprus and the European Union and International Monetary Fund.
He told the three-man inquiry that an "unrelenting" team of technocrats had dispensed savage fiscal punishment to cash-starved Cyprus.
"With the imposition of Germany and the IMF ... they shot a pigeon with an atomic bomb," he said.
But the size of the bailout they were discussing, some EUR17.5 billion, was equivalent to a mere 0.1 per cent of the European Unionâs annual needs, Patsalides said.
Many Cypriots saw their life savings vanish in March when authorities imposed losses on uninsured deposits in two of Cyprusâ banks Laiki and Bank of Cyprus which were badly stung by an EU-sanctioned write-down on Greek sovereign bonds.
The depositor losses, which also hit overseas depositors, many from Russia, were part of Cyprus's contribution ensure it received a EUR10 billion bailout from the EU and IMF.
With Laiki Bank in resolution, the Bank of Cyprus was forced to take on Laikiâs Emergency Liquidity Assistance (ELA) Hermes Birkin Bag Skyblue Golden that the ECB provided to Laiki via the Central Bank of Cyprus (CBC) and was allowed to rise to EUR6.3 billion, Patsalides said.
ELA is meant to be given to viable banks for a limited period, so why Hermes Birkin Tote Bag Peach 25CM was Laiki financed for
Patsalides asked, adding that a question mark hung over the ECBâs actions.
Asked if the government was wise to acquire in May 2012 an 84 per cent stake in Laiki, bailing it out to the tune of EUR1.8 billion, Patsalides said the position that prevailed at the time was that letting Laiki collapse would have been catastrophic to the whole banking system.
But it was
no secret
that for years, the then Central Bank governor, the Finance Minister and the President
Patsalides said. This made promoting policy on a technocratic level more difficult, he added.
And he said that a due diligence test on the banks carried out by investment experts PIMCO with a Central Bank mandate was saddled with [quote]non realistic [quote] assumptions that raised the banksâ estimated needs.
But with the benefit of hindsight, it has become clear that Cyprus did not take enough action to curb expenses and strengthen the economy, Patsalides said. There were plenty of warnings on a technocratic level, Patsalides said, but refused to explicitly state that there was inaction on the part of previous political leadership.
Cyprus, which had modelled itself as an offshore financial services centre for lack of any other resources, now faces a grim future with its reputation in tatters and its economy deep in recession.
"They destroyed an economic system that worked," Patsalides said. "Yes, we have our shortcomings, but the magnitude of the punishment is far greater than the size of the problem."
Asked whether forcing losses on depositors was compatible with their individual rights, Patsalides replied: "When you are dealing with forces of occupation, they don't talk about human rights."
