THE government aims to slash the number of forest fires this summer by raising public awareness and increasing the efficiency of the fire department, the justice minister said yesterday.
“The protection of the environment and public safety are of the utmost importance to the government, and we expect all the services involved in those matters to be fully alert and coordinated in order to effectively deal with fires,” said Ionas Nicolaou, speaking at an event to launch the 12th annual fire safety week.
The government’s goal, the minister said, is to unite all the fire service units on the island within a new strategic plan which will clarify the responsibilities of each department and increase efficiency.
“Despite the financial crisis, the government has not, and will not, make any cuts when it comes to fire safety,” he said, adding his ministry was leasing more vehicles and hiring firemen.
In his speech to members of the fire service, the police force and the press, the minister said that this year the fire service and the government are concentrating on the prevention of fires in the countryside.
Nicolaou stressed that, during the hot summer months, a single spark could ignite a fire which could cause damage and destruction to the environment and threaten human lives and property.
“For this reason I call on everyone to be extremely careful and avoid any activities which could cause a fire,” he concluded.
“I wish and hope that by the end of this year we will have a smaller amount of fires than in 2012 when we dealt with 4194 fires in the countryside which was 463 less than in 2011,” said deputy fire chief, Marcos Trangolas.
Trangolas stressed that this year especially, due to the economic crisis, the public need to be more careful when it comes to fire by placing more importance on preventative measures.
“The fire service’s mission is to deal with fires in the countryside, in residential and industrial areas and also deal with dangerous situations including traffic accidents, earthquake rescues and flooding,” he said.
General-manager of CNP Laiki Insurance, sponsors of fire safety week, Andreas Stylianou, told members of the press that the insurance company and fire services’ common goal is to make the public aware of the dangers connected with fires. “Prevention is better than any form of healing,” he said. “It is our responsibility to be aware of the main ways to avoid starting a fire in order to take the correct preventative measures”.

The 12th annual fire safety week began yesterday under the auspices of the ministry of justice and public order. ‘Prevention through Knowledge’ is the slogan for the week, with planned events to inform the public on fire prevention, culminating with the Fire Service Games on Saturday, May 18 at 3pm at the Makarios Stadium in Nicosia 

KURDISH refugees who have been camping outside the interior ministry for 15 days were told yesterday that the government cannot offer them subsidiary protection.
Three members of the around 150 protesting refugees met with Interior Minister Socratis Hasikos yesterday after starting a hunger strike. He told them to provide him with a list of refugees without a home and those who have applied for work at the labour ministry by tomorrow afternoon and then leave or they will be arrested.
“By the end of the meeting the minister told us to leave his office and the ministry. If we do not do so by tomorrow afternoon we will be arrested,” said Selaheein Bair, a representative for the Kurdish group. “We were told that he cannot give us protection and that we should take this notion out of our minds. The only thing they can do is to consider each refugee’s case on an individual basis.”
When Bair asked the minister how the refugees can stay in Cyprus without protection, the minister said that Kurdish refugees cannot get protection because they are not covered by asylum law.
“We understand the Cypriot people’s problems but we do not know what to do now. Some of us do not have homes and are here illegally. About 43 Kurdish refugees’ visas have expired and they cannot be renewed if they find employment,” Bair said.
The representative said that they were not expecting this response after waiting for 15 days. “They do not want to recognise us as refugees and they just want this to all blow over,” he added.
Outside the ministry 30 men were wearing white T-shirts with slogans saying ‘hunger strike until they give us an answer.
Hasikos said the Kurds could not be offered subsidiary protection because this would mean that they had the same rights as Cypriot citizens.
“The ministry can offer them asylum and what they are entitled to under these rules, this being employment in specific working sectors such as agriculture and farming,” the minister said.
“They told me that some people do not have homes and we are willing to pay rent directly to the landlords in order for them to have shelter.”
The minister said that these refugees cannot expect to receive the same rights as Cypriot citizens, especially under the current circumstances. They should also not expect to get the benefits that the last government was giving them, he added.
“I am ready to help in any way I can but the Kurdish people should respect this country that has hosted them for over 15 years. We will also give them food stamps because we do not want to see anyone go hungry,” he said.
During the meeting yesterday Hasikos told the Kurdish representatives to remove the children from outside the ministry and to stop exploiting their presence.
Doros Polycarpou, the head of immigrant support group, KISA, who was at the ministry said the ministry had got its facts wrong.
“I am not sure if the minister is aware of the fact that all EU countries are obliged by law to give protection to Kurdish people or people of other nationalities that leave Syria due to the war,” he said.

THE BOARD of national carrier Cyprus Airways (CY) has handed in its resignation in protest at the government’s promise to find €20m in compensation to pay outgoing workers as part of a last-ditch effort to save the ailing airline from closure. 
According to state broadcaster CyBC last night, the CY board handed in its resignation to President Nicos Anastasiades, claiming that it simply cannot come up with the compensation money agreed between the government and unions to pay those workers that will be laid off as part of a restructuring plan. 
In a letter to Anastasiades, the CY board reportedly highlights its grievances with the latest arrangement to rescue the airline based on a government proposal, agreed last month by unions, board and government.
The proposal to restructure the company includes offering a redundancy package for 490 members of staff, from the 560 earmarked in the original restructuring plan for the airline, providing 50 per cent of the redundancy compensation initially demanded by the unions.
The CY unions approved the latest rescue deal for the airline last week while the pilots union PASYPY has bemoaned the fact that actual implementation of the rescue plan remains pending, noting that the longer it takes to start the less chance the airline has of surviving.
According to CyBC sources, the board’s biggest problem lies with the €20m the airline will have to find and hand over in compensation to staff made redundant. The board reportedly states it simply cannot raise this money, while the government’s own hands are tied by the European Commission which will not look positively upon more money being pumped into the airline by the state, however it’s dressed up. 
The ministers of finance and communications were out of the country yesterday, pushing back any decision on the CY board’s resignation until tomorrow. 
Regarding efforts to sell the national carrier, Communications Minister Tasos Mitsopoulos said last Friday that Middle East Airlines were no longer interested in investing in CY. He added that other investors were exploring the possibility of investing in the airline.

THE INTERIM board at the Bank of Cyprus (BoC) has pledged to take all necessary steps so the bank can swiftly move away from its current status of being under administration, the government said yesterday.
The island’s largest lender has been undergoing restructuring since March, after a decision by eurozone finance ministers to impose losses on deposits of over €100,000. Under that arrangement, previous shareholders were wiped out, making large savers the new shareholders via a deposit-for-equity swap. The Central Bank, in its capacity as the ‘Resolution Authority’ for Cyprus’ two affected banks - BoC and Laiki - has appointed the members of the BoC’s transitional board of directors.
The bank’s status was discussed at length yesterday during a meeting between the president, the Central Bank governor and the interim board of the BoC.
Speaking to reporters after, government spokesman Christos Stylianides confirmed that the bank’s board would select and appoint a new CEO “sometime over the next few days”.
The appointment of a new CEO - which must be rubberstamped by the banking regulator - is seen as a key step towards returning the stricken bank to normalcy.
Stylianides said the selection of a CEO is first and foremost an issue for the bank board, but added that any decision would be taken in consultation with the CB chief and the finance minister.
“It was agreed today that the person appointed to the job must be competent, that he can deal with the current challenges facing the bank, and that the appointment must be made as soon as possible,” the spokesman said.
Press reports suggest that banker Michalis Kolakides is a leading candidate for the job. Alithia reported that the 58-year-old Kolakides, who has been approached by the government, has asked for time to consider the offer. Kolakides, currently deputy CEO of Eurobank EFG, has previously held senior positions with Citibank Greece and Piraeus Bank, and has served on the board of the National Bank of Greece. He holds an economics degree from the London School of Economics and an MBA from London Business School.
The government has made no secret of its displeasure with the slow pace of restructuring at the BoC. Previously, the finance minister had pointed the finger at CB boss Panicos Demetriades, who initially promised to wrap up procedures by early this month but later hinted that the restructuring might not be complete before September.
Restructuring the lender will take time, however, due to a string of lawsuits filed by depositors against the decision to seize their cash.
Stylianides noted yesterday that any legal obstacles would be overcome once the bank exits its state of administration.
He said also that the government, in a display of confidence toward the banking sector, has decided to “boost and expand” the state’s banking transactions via Cypriot lenders, but did not elaborate.
Responding to a question, Stylianides said the government as well as the CB are keen on finding a strategic investor to invest in the BoC:
But that will have to wait until the bank can run its own affairs, he added.
BoC’s restructuring in March resulted in a drastic shake-up and dilution of the shareholder base. As stated by the CB chief last week, some 70 per cent of the savings affected by the deposit-for-equity swap (uninsured deposits) belong to non-Cyprus residents.
Uninsured depositors - which have suffered a ‘haircut’ of at least 37.5 per cent - are now the new owners of BoC.
Financial website Stockwatch reports that no single uninsured depositor now possesses over 2 per cent of bank stock - making it difficult for the new shareholders to be adequately represented on the board of directors.
On the capital restrictions and when they might be further eased, the spokesman said the government was awaiting the return of the finance minister - currently in Brussels - so that he could confer with the banking regulator.
A new decree on capital controls should be expected by Friday once the current one expires, said Stylianides.
Local media speculated that the new decree would permit companies to open accounts in banks other than in BoC and Laiki - so far prohibited - thus giving entrepreneurs access to more liquidity and enabling them to transact business more easily.
The previous decree exempted four credit institutions operating in Cyprus from the capital restrictions imposed on Cypriot banks: BLOM Bank SAL, Lebanon & Gulf Bank SAL, OJSC Promsvyazbank, and Russian Commercial Bank (Cyprus) Ltd.
It stated however that these banks are prohibited from servicing domestic customers that maintain accounts with their head office, or soliciting and obtaining new business from domestic customers or opening new accounts for domestic customers.

A KNIFE-WIELDING suspected robber was critically injured early yesterday after being shot three times by a plain clothes police officer at a bakery in Lakatamia.
According to head of Nicosia Police Kypros Michaelides, the officer who was patrolling in his car outside the bakery, noticed a suspicious looking man with a knife enter the bakery and attempted to stop him. Police said the man, a 34-year-old Greek Cypriot from Nicosia, attacked the policeman who was forced to use his gun to defend himself, shooting the thief once in the foot, once in the chest and once in the head.
The injured man was taken to Nicosia General Hospital where he was operated on. He is in critical condition and in the Intensive Care Unit.
According to police reports, the officer had initially asked the man to surrender and give up his weapon. The 34-year-old, who has not been named, allegedly refused to stop and the officer was forced to shoot him in the foot as a warning. Despite the policeman’s repeated demands that the suspect drop his knife, he refused to do so, resulting in the officer having to shoot him again, once in the chest and once in the head, police said.
The incident was witnessed by the bakery’s cashier whose statement police will examine during their investigations along with CCTV footage from the scene.
Justice Minister Ionas Nicolaou expressed his sadness over the incident and told reporters yesterday that he hoped the injured 34-year-old would recover from his injuries.
“Incidents like this are difficult to judge and need to be investigated fully without jumping to conclusions,” the minister said. Nicolaou added that a full investigation is needed to ascertain whether the officer used his weapon according to procedure.
“I have spoken with the Attorney-general and he assured me he will assign an official from legal services to the case who will investigate it objectively,” Nicolaou said.
He said the number of plain clothes officers patrolling outside late-night bakeries and kiosks have been increased as they are increasingly common targets for robbery.
He said that a man with a kitchen knife has terrorised a number of establishments in the last few months, although it is uncertain whether it is the same man.
“The culprit has caused headaches to the police so they have tried to find a way to combat his actions, which is why the officer was parked outside the bakery in his car on the lookout for any suspicious characters,” he added.
“The events which need to be investigated are why he used his revolver and whether he used it in self-defence,” the minister said.
He called on the public to adhere to police instructions and stressed that officers have firearms to protect themselves from potential assailants.
“The force is facing organised crime and desperate individuals who could be putting officers’ lives in danger so we need to provide them with the tools to protect themselves.”

Police officers investigate the scene of the bakery shooting

The evolution of local government in Cyprus is testament to the insistence of our politicians on setting the wrong priorities when formulating policy. This is the reason we have ended up with 30 overstaffed municipalities – we have not included the nine occupied municipalities which have a mayor - we cannot afford to sustain.
We could never afford them, but in past years the central government would guarantee loans, there was rescheduling of loan repayments, funding was secured from abroad and municipalities managed to get by. Despite the persistent financial difficulties faced by local authorities, our politicians, in their wisdom, created another six municipalities in 2011, thus adding to the state’s costs.
Now, nobody seems to know what to do. The Union of Municipalities held an extraordinary general meeting last Friday to discuss the lack of funds and decided that the way forward was restructuring, with the aim of increasing the autonomy of local government. Reducing the number of municipalities was not an option at present, the mayors decided. It is difficult to see how there could be more autonomy - which implies financial independence - through restructuring, without reducing the number of municipalities.
The troika, according to one report, had suggested that the number should be reduced from 39 to 10 and it is very difficult to disagree with our lenders, who view the issue from a more rational perspective than our politicians and mayors, who are primarily concerned with votes. We have so many municipalities because they serve the party system, offering positions to party members – as mayors or municipal councillors – and jobs to party supporters.
It suffices to say that 75 per cent of the municipalities’ budgets go on the payment of salaries and pensions. If we add loan repayments, office expenses and maintenance costs, how much is left for improving the quality of life of citizens, which all mayoral candidates claim is their priority? The truth is that municipalities primarily exist to serve their employees and political party clientelism. That is why we have such a ridiculously high number and cannot afford to keep them going.
If restructuring is to be meaningful, there should be a drastic reduction in the number of municipalities as the troika suggested. Admittedly, jobs would be cut, but local government would become much more cost-effective and financially sustainable. Only when a municipality becomes viable does it become autonomous and, more importantly, acquire the ability to serve people and even improve their quality of life. The existing model serves only highly-paid municipal employees and will eventually face bankruptcy.

THE EUROGROUP gave its blessings to the disbursement of €3 billion to Cyprus yesterday, with the first €2 billion already sent to the island as part of the first tranche of a €10 billion bailout expected to “buy time” for its ailing economy.
The group of eurozone finance ministers met for nearly six hours in Brussels yesterday, discussing among other things the bailout programmes of Cyprus and Greece and the troika’s assessment of Cyprus’ anti-money laundering measures.
During the first hour of the Eurogroup meeting, the European Stability Mechanism (ESM) board announced its approval of the Financial Assistance Facility Agreement with Cyprus and the disbursement of the first tranche of ‘rescue’ money worth €3 billion.
The first tranche will be transferred in two separate disbursements: the first €2 billion was transferred yesterday, while the remaining €1 billion will be transferred before June 30.
Both disbursements will be made in cash, and will be used for the general financing needs of the public sector, including the considerable sum of maturing debt the government is expected to pay next month, and the country’s fiscal needs.
“The loans granted by the ESM help to maintain financial stability in the euro area and buy time for Cyprus,” Klaus Regling, Managing Director of the ESM said.
“This time enables Cyprus to undertake the reforms necessary to rebuild its economy on a sustainable basis.”
In accordance with the Eurogroup decision on March 25, Cyprus will receive assistance of up to €10 billion during the next three years.
Cyprus signed a Memorandum of Understanding (MoU) with the European Commission containing many reforms demanded of the government in exchange for the loan at the end of April. Compliance with the MoU will be reviewed every three months before the next tranche is disbursed, with the first review likely to be in September.
Repayment of the loan will begin in ten years’ time and have a maximum maturity of 20 years while the interest paid will likely be between 2 and 3 per cent, depending on the ESM’s costs.
No portion of the €10 billion can be used to recapitalise the island’s biggest bank, Bank of Cyprus or Laiki, whose losses were considered too big to be covered by the EU. 
Instead, €3.4 billion of the funds will be used to cover Cyprus’ fiscal needs, €4.1 billion to redeem its medium and long-term debt, and €2.5 billion for the recapitalisation of Cyprus’ other banks.
Cyprus is not only the first fully fledged macro-economic bailout financed by the ESM, it is also the first country forced to contribute to its rescue package with a “bail-in” of over €10 billion by uninsured depositors of the island’s two biggest banks. A further estimated €3 billion will come from privatisations, state gold sale and fiscal adjustments.
On concluding their meeting late last night, eurozone finance ministers welcomed the ESM’s approval of the first tranche.
Eurogroup President Jeroen Dijsselbloem said it was an “important step towards the stabilisation of the Cypriot economy reflecting our unwavering commitment to preserving the financial stability of the euro area and its member states”.
The Dutch finance minister noted that Cyprus implemented all prior actions as agreed in the MoU before yesterday’s ESM decision on the first disbursement.
“The Eurogroup commends the Cypriot authorities for delivering on their commitments to date and reiterates its appreciation and understanding of the efforts made by the Cypriot citizens,” he said.
Dijsselbloem also referred to the independent assessments of compliance with the anti-money laundering (AML) framework in Cyprus prepared by the Council of Europe’s Moneyval and Italy’s private auditor Deloitte Financial Advisory.
A private audit of Cyprus’ AML framework was made a precondition of any bailout by the Eurogroup.
According to Dijsselbloem, the troika reported the key findings of the two AML reports to the Eurogroup and recommendations to “rectify deficiencies” will be integrated in the AML action plan to be agreed between the troika and Cyprus during the first review of the bailout programme in three months’ time.
“The action plan will need to target areas covering implementation of customer due diligence by banks, including through adequate supervision, and the functioning of the company registry, among others,” said the Eurogroup president.
According to the Cyprus News Agency, speaking to reporters, Dijsselbloem said the AML report shows that the legal framework in Cyprus is appropriate though there are some delays in its implementation.
There has been much speculation on the outcome of the anti-money laundering parallel audits given that allegations of money laundering, particularly by German lawmakers and media, were most rife in the months preceding the Eurogroup decision for a ‘bail-in’ bailout of Cyprus.
The EUobserver last week reported that opinion in Brussels was divided as to whether the actual AML report will ever be released, which would provide welcome clarity on the extent to which Cyprus truly was guilty of the accusations of money laundering, made by various EU partners.
Earlier this month, Finance Minister Harris Georgiades said Cyprus was given a clean bill of health in terms of its compliance with international anti-money-laundering rules.
“The situation for Cyprus is far better than what perhaps many abroad wished to portray,” the minister said, adding that any ‘loopholes’ in the local AML system would be closed.
Financial online news site Stockwatch yesterday reported that the ALM report states banks do not perform adequate due diligence on foreign clients while there appears to be excessive dependence regarding the identity and quality of clients on the introducers, ie, accountants, lawyers and fiduciary service providers. Problems were also reportedly found with the registrar of companies, complicating efforts to find information on beneficiary companies.
One German anti-money laundering expert, Andreas Frank, who has been following closely implementation of AML legislation around Europe yesterday noted that the ESM press release, issued almost five hours before the Eurogroup statement did not contain any mention of the results of the AML probe of Cyprus’ financial sector.
The ESM decision was alleged to be contingent on the results of the probe and improvements on the assumed money laundering deficits in the Cypriot financial sector, he said.
“To get the approval from the Bundestag for the rescue package, the German government had assured the MPs that the ESM would agree to the aid package only under the conditions that the money laundering allegations against Cyprus would be clarified. It becomes obvious that the Bundestag MPs were deceived and the ‘dirty money’ claims by some Eurogroup members were just an excuse for the bail-in,” he added.

Eurogroup president Jeroen Dijsselbloem

UP TO 80 fishermen are expected to opt out of the profession this year, as overfishing and dwindling fish stocks draw dolphins closer to shore waters looking for food while the puffer fish continues to damage nets. 

About 120 fishermen holding a licence to operate smaller vessels less than 12 metres long, have applied to a different scheme to encourage fishermen to retire, leaving behind a smaller and more sustainable number of fishermen. 

There are currently between 450 and 500 licensed fishermen - applications have not been fully processed yet so a precise figure couldn’t be given. Kyriacou said the fisheries department expected to help between 70 and 80 of those licensed fishermen to retire, with some €3.0 million available in total. 

Fishermen who retire their small vessels will get €20,400 plus the value of their boat as designated by a committee within the fisheries’ department that should come to about €17,000 on average. Under previous equivalent schemes, 12 bigger vessels have been retired with between 20 and 25 vessels remaining. And whereas there used to be eight Cyprus-flagged trawlers, there are now just two that are active off Malta, Kyriacou said. 

Professional fishermen used to get state help for damaged nets that was set according to how often they went out to sea in the previous year and reached up to €1,700 a year for the busiest fishermen, Kyriacou said. With austerity measures in place, the government stopped paying the subsidy in 2012.

Kyriacou said that a different compensation scheme would help control the puffer fish population, which is a consistent problem for fishermen in Cyprus. 

Dolphins sometimes manage to get fish out of nets without injury to themselves and can be a nuisance to local fishermen, but it is the Lagocephalus puffer fish that can inflict greater damage to fishermen’s nets, the department’s Yiannos Kyriacou said. 

Puffer fish damage nets and impinge on fishermen’s income with the professional fishermen in the Famagusta district previously protesting on what they said were unreasonable fishing quotas. Daily Politis yesterday quoted a fisherman from Famagusta’s Paralimni as complaining about a pod of dolphins destroying their nets a few days ago.

For the second year running, a €150,000 programme whose expenses are split with the European Commission, allows registered fishermen to net puffer fish during the summer period (until September) in exchange for compensation. Trading puffer fish is illegal because of the species’ toxicity, but participating fishermen will get €3.0 per kilo, with the fish being disposed of as waste according to specified arrangements, Kyriacou said. Because puffer fish breed in June and July, the hope is that the scheme will control the population. 

The United Nations and the European Commission regulate fishing on regional and national levels. Restrictions vary from imposing fishing quotas to specifying fishing season and methods for specific species.  “We all fish in the same seas, there is no point for one country to protect a migrating species if they are not protected elsewhere,” Kyriacou said.

Some €3 million is available to buy out 'retiring' fishermen

THE ATTORNEY-General and the Central Bank Governor are expected to appear before Parliament’s ethics committee next week to discuss how the country’s banking system came close to collapse. 

Head of the ethics committee Demetris Syllouris said he would encourage members of the committee to submit written questions to avoid repetitions. The MPs want to look into how, as part of a bailout, the country’s second biggest bank has been forced to wind-down with the biggest, Bank of Cyprus, undergoing radical restructuring. Syllouris previously said the committee would look at whether the Central Bank Governor Panicos Demetriades supplied sufficient and/or accurate information to parliament. 

The ethics committee’s report cannot be binding, since parliament’s job is to pass laws. A committee of inquiry is currently looking into the civil, political or criminal responsibilities.

Syllouris said yesterday that he had been called to testify at the inquiry.

He said yesterday he had asked Demetriades not to show up yesterday as originally planned, because some MPs would be absent from the hearings. 

Irni Charalambidou, MP for former ruling party AKEL, said Syllouris was accommodating ruling DISY leader Averof Neophytou “unilaterally and without prior communication” even though Neophytou was not a member of the ethics committee.

The committee also discussed the possibility of taxing those people who managed to withdraw their money from financial institutions on the island prior to the Eurogroup meeting on March 15.

The ethics’ committee met behind closed doors.

ATTORNEY-general Petros Clerides has appointed a three-person committee to investigate the events which led to a plainclothes police officer shooting and severely injuring an alleged robber at a bakery in Lakatamia on Monday. 

Police handed over evidence along with CCTV footage from the incident to the committee yesterday.

The officer who shot and injured the 34-year-old alleged knife-wielding robber on Monday was performing his duty as a policeman and had no other option but to fire, according to police association head Andreas Symeou.

According to police the officer had initially asked the suspect to surrender and hand over the knife but he allegedly refused, and the officer was forced to shoot him in the foot as a warning. Despite the policeman’s repeated demands that the suspect drop his knife, he refused to do so, resulting in the officer having to shoot him again, once in the chest and once in the head. The suspect is in critical condition at the Nicosia General Hospital. 

“I fully support the officer, not only because he is a member of the force but because he did his job as he was supposed to and prevented irreparable harm,” he said.

Symeou added that according to confirmed reports, the policeman could not have acted differently as the assailant was armed with a knife and was prepared to use it on him, a customer, or employee of the bakery.

He expressed the certainty that the investigation ordered by Justice Minister, Ionas Nicolaou, would find the officer innocent of any wrongdoing. The association would demand his promotion, Symeou said, adding that the officer’s actions would send a message to criminals. 

The 34-year-old alleged robber was named as Panicos Argyrou from Akaki. Police suspect him of a series of robberies – as many as 25 - carried out on bakeries in the Nicosia district over the last two months. 

The use of guns by police is the last and most painful form of state interventionism in constitutionally protected human rights, according to Ombudswoman, Eliza Savvidou’s office. “In cases where the use of guns is unavoidable it should be taken as a last resort and as an exceptional measure, to be exercised sparingly, as part of official duties and in accordance with the principles of legality, necessity and proportionality,” the statement said.

Savvidou added that in order to ensure police used their weapons correctly they should be required to follow certain training that would create a culture of respect for citizens' rights and to enhance transparency and accountability.

The Friends of the Police association expressed their deepest sympathies towards the injured 34-year-old and hoped he would make a full recovery. In a statement the association also gave its full support towards the officer who was carrying out his duty and service for the benefit of society.

“We applaud the immediate appointment of an independent investigative committee and call on the public to trust and help the police,” the statement concluded.

CYPRUS IS slowly losing its pariah status among EU partners though the country still has a way to go before proving its reliability, said Finance Minister Harris Georgiades yesterday. 

Speaking from Brussels where he attended the Eurogroup meeting on Monday night, Georgiades said: “We’re doing well, the climate has changed”. 

The Eurogroup had welcomed the disbursement of the first €3 billion of the EU bailout for Cyprus, €2 billion of which has already arrived in state coffers, while another €1 billion will be despatched at the end of June. 

Eurogroup President Jeroen Dijsselbloem noted that Cyprus had implemented all prior commitments as set out in the memorandum of understanding with the troika, triggering the release of the first bailout disbursement.  

The Dutch finance minister also acknowledged that Cyprus’ anti-money laundering legal infrastructure was in place, though more work was needed on its implementation, particularly with regard to banks’ due diligence of real beneficiaries and the need to make information at the Registrar of Companies more accessible. 

The Eurogroup’s conclusions came after it was briefed by the troika on the results of an anti-money laundering audit undertaken by the Council of Europe’s Moneyval and private firm Deloitte. 

Georgiades yesterday said the climate in the Eurogroup has changed in favour of Cyprus, though there was still room for further improvement, since some of Cyprus’ partners maintain their reservations with regard to Cyprus’ ability to manage the current situation in a better way.

“We need on our part to do plenty to prove in practice that we are ready,” he said.  

The minister argued that the findings of the independent assessments of compliance with anti-money laundering (AML) regulations in Cyprus do not justify a stricter approach by Cyprus’ EU partners.

However, recommendations to rectify any deficiencies will be integrated in an AML action plan to be agreed between the troika and Cypriot government during the first review of the bailout programme. 

“We have to clear our reputation as a state,” he said. 

“Money laundering is a global problem. The political climate has changed emphatically for the better, and this is not only related to efforts of the new government, but with the recorded declaration of Cypriot society to proceed with decisive steps, and correct existing problems that were allowed to be created,” he added. 

The ministerial committee set up to monitor implementation of the bailout programme will meet this afternoon

Following the Eurogroup decisions on Cyprus last March to implement the first ‘bail-in’ since the eurozone crisis began, some analysts highlighted Cyprus’ failure to build friends and allies within the group of eurozone ministers. 

Maltese finance minister Edward Sicluna described the mood when the Eurogroup took its first decision on a haircut of insured and uninsured Cypriot depositors on the long night of March 15 in an opinion piece shortly after. 

Sicluna noted that Cyprus was made to contribute to the bailout on account of it being recognised as a tax haven for the Russians “with abundant stories of flagrant gross money laundering activities”. 

The Maltese official referred to the “undignified… sight of a bankrupt person begging for assistance”, and referred to finance minister Michalis Sarris agreeing to the Eurogroup’s demands for a ‘bail-in’ but only after ten long hours and “with a pistol to the head”. 

“The feeling one got on exiting the meeting in the early hours of the day was that never in one’s life would one like to dream the experience let alone live it,” said Sicluna. 

Others have questioned why EU paymaster Germany made a huge stink about Cyprus’ so-called failure to tackle money laundering in the run-up to the March decision, with German lawmakers and media voicing opposition to using taxpayers’ money to save allegedly ‘dirty’ Russian accounts. 

The intense criticism has since died down, with the Eurogroup clearly taking a softer approach to Cyprus. Some argue this is because the Monevyal/Deloitte audit proved Cyprus is not the ‘bad boy’ of Europe in terms of anti-money laundering measures. 

Others have commented that the Eurogroup could hardly highlight Cyprus’ deficiencies and then approve the first tranche of the €10 billion bailout without setting stringent conditions first, particularly ahead of German elections this September. 

The unclear picture painted has led some member states like Finland to demand greater transparency, mainly through the publication of the Moneyval/Deloitte report.

STRICKEN Bank of Cyprus (BoC) has taken another step in the long road toward its restructuring by absorbing the balance sheet of Laiki Bank, the banking regulator said yesterday.

The absorption of Laiki’s balance sheet into BoC’s books took place late on Monday. Sources close to the Central Bank confirmed reported figures placing BoC’s assets at €38.3bn and liabilities at €34.7bn.

The BoC has equity capital amounting to €3.6bn, of which €3.1bn from a 37.5 per cent ‘haircut’ on uninsured deposits at BoC, plus another €500m from the sale of assets of the ‘bad’ Laiki.

These estimates are provisional, the sources stressed.

Under a decision by eurozone finance ministers taken in March, Laiki is to be wound down with the full contribution of equity shareholders, bond holders and uninsured depositors. Laiki is to be split into a good bank and a bad bank. The bad bank will be run down over time while BoC would absorb the good bank.

Laiki would transfer to BoC all of its assets, property titles and rights apart from certain exceptions. The exceptions relate mostly to Laiki shares in subsidiary companies outside Cyprus, Laiki assets and rights in the United Kingdom and Greece, and provisions relating to the offsetting of loans owed towards Laiki with deposits held therein.

In return BoC will take on some of Laiki’s obligations, including the €9bn of Emergency Liquidity Assistance debt that Laiki has accumulated, as well as Laiki’s insured deposits (i.e. deposits of less than €100,000).

The BoC, itself currently under administration by the Central Bank, is headed by an interim board of directors.

The bank is also struggling with capital restrictions, put in place to avert a feared bank run. A Central Bank spokeswoman said yesterday that a further and substantial easing of restrictions should be expected on Friday.

Under an agreement between Cyprus and international lenders (the Memorandum of Understanding of April 2013), 37.5 per cent of uninsured deposits in BoC will be converted into class A shares with full voting and dividend rights, providing the largest part of the capital needs with additional equity contributions from the legacy (old) entity of Laiki. The remaining uninsured deposits of BoC will be temporarily frozen.

Should the 37.5 per cent conversion turn out not to be enough in order to secure the 9 per cent capital adequacy that BoC requires, then up to a further 22.5 per cent of uninsured BoC deposits may be converted into Class A shares. In other words, 60 per cent of the uninsured part of BoC deposits is susceptible to a ‘haircut’ or conversion into equity. The remaining 40 per cent of uninsured BoC deposits is for the time being not subject to such conversion but 30 per cent of it remains frozen.

To ensure that BoC’s 9 per cent capitalisation targets are met, a more detailed and updated independent valuation of the assets of BoC and Laiki must be completed by the end of June. The valuation’s terms of reference will be agreed in consultation with the European Commission, the European Central Bank and the International Monetary Fund - the troika of international creditors.

According to the MoU, “Following that valuation, and if required, an additional conversion of uninsured deposits into class A shares will be undertaken to ensure that the core tier one target of 9 per cent under stress by end-program can be met.”

Sources tell the Mail that, following the valuation which should be completed by end of June, it would take about an extra 90 days to sort out the final balance sheet for BoC. That would determine the final ‘haircut’ on BoC uninsured depositors - essentially the new shareholders - and thus pave the way for a shareholders AGM to elect the new bank board.

The same sources said the Attorney-general’s office has furnished the Central Bank with a legal opinion, which recommends that BoC’s status of administration should end only once the haircut amount has been finalised. This is now the policy of the banking regulator, the sources added.

Determining the new shareholder base is a key stage toward returning the island’s largest lender to normalcy. But the size of the ‘haircut’ will depend also on the success or failure of a string of lawsuits filed by depositors against the decision to seize their cash.

The government is anxious that BoC return to normal business as fast as possible, arguing that this would end the period of uncertainty and inject some confidence back into the liquidity-starved market. But commentators have highlighted another factor: a power play between the government and the Central Bank. A law passed in March has given the banking regulator sweeping powers over commercial banks.

Still, government spokesman Christos Stylianides yesterday sounded an upbeat note on BoC’s prospects:

“The efforts for the survival and rescue of the Bank of Cyprus are on a solid path. The crisis is not over..but positive signs are emerging indicating that we are in a better position than a month ago,” Stylianides said.

Another important step is the appointment of a new CEO, who needs the blessing of the Central Bank. Central Bank Panicos Demetriades yesterday met with an undisclosed number of candidates for the job. Among them, according to media reports, was the leading contender, 58-year-old Michalis Kolakides, currently deputy CEO of Eurobank EFG.

The absorption of Laiki's balance sheet into BoC's books took place late on Monday

FIVE viable bone marrow donors have been found for five-year-old George Philippides from Kili in Paphos who has been diagnosed with leukaemia and needed urgent treatment.

The good news was given to the Phillipides family on Monday according to the boy’s uncle, Marios Philippides. 

He revealed yesterday that during the last few days suitable donors had been found in five countries including Germany, Israel and the USA, although only two of those donors were currently available. According to Philippides, if the donor is from a country in the same region then arrangements are made to bring that person to Cyprus in order to carry out specialised examinations to see if they are a match with the little boy.

According to the head of Paediatrics at the Makarios Hostpital, Loizos Loizou, both available donors are around 90 per cent compatible with the young boy. 

The final decision on any donor is made by the doctors, the uncle told reporters, adding that the family was awaiting news from them to see when to take the 5-year-old to a medical centre in Germany in two weeks to perform the operation.

Philippides thanked the public for their support and expressed the hope that others afflicted with leukaemia would also receive help in the future.

Little George is currently being cared for in the paediatric wing of the Makarios Hospital in Nicosia where he will remain until he leaves for Germany. He has two older brothers aged 18 and 21.

A campaign began in April to find a suitable donor four him. Last month national guardsman, Andreas Vassiliou, who had received a successful bone marrow transplant in 2000, made a public plea along with Defence Minister, Fotis Fotiou for a donor to be found for the five-year-old.

CYPRUS Airways unions are questioning the logic behind reported intentions by the airline to hire three executives of Lufthansa Consulting for a combined fee of €1.3m.

The three have been approached by the board of CY to supervise the restructuring of the ailing airline until the end of the year. It’s understood the Lufthansa execs were on the island for talks with the CY board last week.

Reports yesterday said the three have been offered a whopping €1.3m between them for the remainder of the year - a figure, which if accurate, does not sit well with CY trade unions who are facing pay cuts of up to 25 per cent as part of the airline’s restructuring and downsizing.

Unconfirmed reports said also the Lufthansa execs would be acting as consultants but at the same time would be given executive powers.

The airline could not be reached for comment yesterday.

But Andreas Pierides, head of the airline’s largest union CYNIKA, said that if the reports were true they raised a series of questions.

“First, who are these people, and are they familiar with the Cypriot market?” he said.

“Second, why is the government and/or the company hiring people from Lufthansa? Would it not make more sense to hire consultants from Air France-KLM, the same people who drafted the restructuring plan and know it inside out?”

Moreover, Pierides asked, “given that these people are outsiders, how will they be held accountable for any mistakes or omissions?

“And how is the company going to come up with the €1.3m to pay these foreign consultants? Not to mention that this amount is insulting to the airline employees who are facing 20 to 25 per cent cuts in salary.”

The trade unionist also questioned the wisdom of hiring consultants now, at the start of the summer season, since all the deals and routes for the summer are already in place.

“If it was at the start of the winter season, then fine. But now, what will they be doing to earn €1.3m? Work on their tans?”

In a loaded comment, Pierides pointed out also that Lufthansa and Aegean Airlines - a competitor of CY - are partners in Star Alliance, the largest global airline alliance that has code-sharing agreements in place, among others.

The proposal to restructure the national carrier includes offering a redundancy package for 490 members of staff, from the 560 earmarked in the original restructuring plan for the airline, providing 50 per cent of the redundancy compensation initially demanded by the unions. 

CY unions approved the latest rescue deal for the airline last week.

Around 150 Syrian Kurds – including many children – have been camped outside the Ministry of the Interior for the past two weeks, demanding that the government either give them ‘protection’ (i.e. the right to live and work in Cyprus) or help them move on to another European country.

THE BOARD of Cyprus Airways may have made many mistakes during their term but they deserve congratulations for taking a stand over the agreement on redundancy compensations between the government and the unions. All members of the CY board submitted their resignations in protest against the government’s scandalous decision to allocate €20 million of the airline’s money to compensate staff who would take early retirement.

The board had made it quite clear that the company did not have the money while the government, which reached this deal, cannot provide the funds as it had been strongly warned by the European Commission against offering any financial support to the airline. So how did the ministers that negotiated with the unions agree to such a deal? Did they not know that the airline was on the brink of bankruptcy and did not have €20 million to pay as compensation? But even if it could raise this amount, would it not be better being used in the effort to save the company from looming closure?

It is not even as if the airline’s overpaid and underworked employees have a right to compensation that is 50 per cent higher than redundancy pay they are entitled to by law. Why is it that workers at state companies believe they are entitled to bigger redundancy pay-offs than private sector workers? Are they a higher class of worker? They certainly did not have a more taxing working life. On the contrary, the CY unions squeezed so much money out of the company in benefits, overtime and salaries for their members that the company is now, technically, bankrupt. 

These privileged workers are giving one last illustration of their greed and selfishness by trying to squeeze even more money out of the company they had been plundering for decades. Worse still, the government, betraying gross populist irresponsibility, has given its approval to the costly, preferential treatment of CY staff. By what logic does the government expect a bankrupt company to give €20 million it has no legal obligation to pay in additional compensation to staff? 

Surely it should have taken a position on principle - that state workers should not be treated differently from private sector workers when it came to redundancy pay. Instead we have a bankrupt state committing a bankrupt state company to pay €20 million it does not have to workers who are not entitled to it. Our economy may have collapsed but our politicians have learnt nothing from the experience and remain as irresponsible as they have always been.

ONE WAY or another the government will implement the rescue plan for national carrier Cyprus Airways (CY), Labour Minister Zeta Emilianidou said yesterday in a veiled warning to the CY board, which submitted its resignation earlier this week. 

Communications Minister Tasos Mitsopoulos echoed his colleague, noting that time was running out for more dialogue. If the airline is going to survive, there is little room for manoeuvre, he said.

Board members handed in their resignation en masse in protest against last month’s decision to allocate around €20 million of company funds to compensate staff made redundant as part of a last-ditch effort to save the airline from closure.

The sum agreed between the government, board and airline unions last month was 50 per cent of the compensation package offered by the company in its last redundancy plan.

It is understood the compensation offered is over and above what CY employees are entitled to by law; a common practice within the wider public sector, though rarely seen in private sector redundancy deals.

According to government sources, before leaving office, the previous government had agreed with the unions in December to give 80 per cent of the original compensation package.

When the unions met with the current government and board in April, they negotiated the figure down to 50 per cent.

However, on Monday, the board reportedly sent a letter to President Nicos Anastasiades listing its grievances with the latest arrangement to rescue the airline based on a government proposal to reduce operating costs, which includes a redundancy package for 490 members, and the downsizing of its fleet by four planes. Three Lufthansa consultants will also be hired for a nine-month period to oversee implementation of the rescue plan.

Since the April agreement, two CY planes have already been returned while the leases on a further two are due to be rescinded. Redundancies are expected to start next week, while compensation will be paid out in stages, starting in 2014. The government is also on the lookout for a strategic investor after Middle East Airlines declared they were no longer interested.

According to reports, the board’s biggest problem lies with the €20m the airline will have to find from the company’s depleted assets and hand over in compensation to staff made redundant.

Meanwhile the government’s own hands are tied by the European Commission which opened an “in-depth investigation” last March into whether €104 million in state aid granted to CY complies with EU state aid rules.

When making the announcement, the commission said, on the face of it, it had “doubts whether these measures are in line with EU state aid rules”. 

The commission further doubted the credibility of the CY’s restructuring plan, and questioned the intention to grant compensation to redundant personnel over and above what they were entitled.

In the same month, the airline revealed that it had more than doubled its losses in 2012 to €55.8 million, making the search for a further €20m now even more challenging.

Another violation being investigated is the fact that CY already received aid in 2007, though EU state aid rules specify that companies in difficulty can receive rescue and restructuring aid only once over a ten-year period.

The government, a majority shareholder in the airline, has since hired the services of Brussels-based lawyers to counter the charges.

In a clear dig at the board’s decision to resign and the reasons given, Emilianidou yesterday said: “The board was present throughout (last month’s) negotiation.”

Asked to comment on the shaky future of the airline, the minister told the Cyprus Mail: “A decision has been taken by cabinet, meaning the government has adopted the agreement. Since the government has taken a decision on Cyprus Airways, it has to be implemented.”

The assumption appears to be, if this board refuses to implement the deal, the government will simply appoint another one.

However, the finance ministry is responsible for new appointments and according to some sources, the ministry was not fully supportive of the 50 per cent compensation agreement.

Asked to comment, Emilianidou repeated: “There is a cabinet decision on the matter.”

Mitsopoulos told the Cyprus Mail yesterday he will try to hold a meeting today with the board and the ministers of finance and labour to discuss the problem, warning, however, that many months have already been spent in dialogue and not enough in implementing the rescue plan.

“An agreement was reached last month. We have not started implementing the most important parts of it yet. The biggest cost is the staff and they are still there,” he said, adding, “there is no room for manoeuvres anymore”.  

Regarding the board resignations, he said: “When we sat down with the board and unions, the board didn’t say there was a problem. Today, they are telling us they had reservations from the start. 

“But it was the board and unions that began negotiations first, then the government joined in.” 

Mitsopoulos said the cabinet decision was to keep the airline afloat, not just until the summer passes, but in the long-term. 

He argued against those who claim the government is only thinking in the short-term to guarantee summer tourist arrivals. 

“The company has reached a stage where even if it closed today, it won’t have a huge impact on tourism. Around 150,000 tourists may be lost but the company doesn’t transport as many passengers as it used to.”

“But our intentions are honest, to work to put the company back on track and consolidate its finances. We are a remote island and we need a Cypriot-interest company, not a state company, but a company that will serve Cyprus,” he said.  

“Implementing the rescue plan is a precondition, some haven’t realised that yet,” he added.

The minister bemoaned the conflicting climate that continues to plague the company: “One union fights another. I believe some have illusions that the state can give millions each year to keep it alive like in the past.” 

Cyprus Airways has already started to cut back on the size of its fleet

IT IS not the job of unions to decide who will run Cyprus Airways (CY), said pilots’ union head Petros Souppouris yesterday, in a clear dig at other airline employee unions who have protested against the appointment of foreign experts at the national carrier. 

Representatives of the pilots union PASYPI met with Labour Minister Zeta Emilianidou and Communications Minister Tasos Mitsopoulos yesterday to discuss implementation of the restructuring plan aimed at saving the airline from imminent closure.  

Despite recording losses of €55.8m last year, the national airline has yet to implement key elements of the restructuring plan written up by Air France-KLM, mainly making 490 staff redundant.

With the government under investigation by the European Commission for granting €104 million to CY, the airline is facing imminent closure if it does not implement a turnaround in management, operations and fortunes soon.  

The CY board recently handed in its resignation over a decision taken last month to provide redundant staff with 50 per cent of the compensation initially sought by unions, counting for €20m. 

On Tuesday, a number of CY unions voiced opposition to the government’s intention to hire three executives of Lufthansa Consulting for a combined fee of €3.1m to supervise the restructuring of the ailing airline until the end of the year. 

Emiliniadou yesterday told the pilots that the government remains committed to implementing the restructuring plan. 

Mitsopoulos warned unions to get on board with the restructuring plan in a spirit of cooperation or else face the consequences.

“In reality, time is running out, as are the capabilities and endurance of the company,” he said. 

If the company is to stay in operation and become viable, “the company needs a spirit of cooperation which unfortunately doesn’t exist today”.

After “marathon meetings and consultations”, the government hoped the airline could make a new start so by the end of the year it would be on a healthier path and even attract a strategic investor. 

Mitsopoulos expressed his “deep disappointment” that instead, he is now seeing “actions that undermine what has been agreed and in practice bring into doubt the path set for the next few months with all the negative consequences this misguided behaviour brings”.

On the appointment of Lufthansa consultants, the minister highlighted that part of the agreement reached with the unions and board was to seek foreign experts to offer know-how on managing the company. 

“In all the many meetings we had, this issue was not raised, unless I’m living in another universe.”  

For his part, Souppouris said PASYPI supports the ministerial committee’s efforts to take swift action to implement the restructuring plan. 

“It is the only way to rescue Cyprus Airways and get foreign investors interested.” 

On the Lufthansa appointments, he said: “Deciding who will manage the company is not the job of unions. It is the job of the owner which is the state and has the right to decide. It’s not about reaching agreement with the unions”.

SPEAKING out against wasting taxpayers’ millions to set up a Medical School by the University of Cyprus, MP for ruling party DISY Andreas Themistocleous said politicians needed to “get real”. 

Themistocleous who has submitted a bill to parliament to postpone plans to set up the medical school in September 2013 said that the country faced a choice “of either getting real and actually looking at the country’s situation or else – and I’m willing to bet on this – destroying ourselves”. 

“It will cost €100 million a year to run the medical school, you heard me right, €100 million,” Themistocleous said adding that each graduating doctor would cost the state about €1.0 million. “These are outrageous amounts,” he said.

“Say you are a struggling member of the public, what would you say if parliament imposed another tax just to maintain this school?” 

When AKEL was still in power in November, opposition MPs rescinded on a move to freeze supplementary funds to set up the school, after previously saying they wanted to ensure the money would be well spent, and raising concerns over the government’s ability to meet the September 2013 deadline. One deputy, DISY’s Nicos Tornaritis, said his party did not want to be blamed for delays in establishing the school.

But since November, Cyprus’ has agreed to an EU bailout and is expecting the economy to continue contracting for at least two years. 

“Cyprus is now facing its biggest economic crisis since its inception and the country’s long-term and short-term needs dictate that we immediately reset our priorities,” Themistocleous said.

AKEL’s Christos Christofides who represents the party on education policy and is also a  former deputy government spokesman said yesterday that postponing the medical school’s opening would have negative consequences. The medical school will benefit public health and keep students in Cyprus, preventing money from leaving the country he said. If the school opens in September next year, it should welcome about 40 students. Christofides also said that students and patients from abroad would come to Cyprus, while the medical school could get funds from the EU or elsewhere, creating more jobs. 

The Cyprus Medical Association also said yesterday despite the crisis, matters of education and health needed to be treated differently and “with more sensitivity”. A medical school would contribute to upgrading the country’s medical practice improving health care provision, the association said.

Asked how much money had already been spent to pave the way for the medical school Themistocleous said he was not interested in how much money had been spent already but rather in preventing any more from going towards a project that could be postponed.

“We’ve got by without a medical school (for decades). Can’t we survive for another five years?” he said.

The University of Cyprus wants its own medical school but the economy is in crisis

A BRITISH teenager that pleaded guilty to a charge of manslaughter over the stabbing death of a British soldier will be sentenced tomorrow.

In a change of plea last month, Mohammed Abdulkadir Osman, 19, admitted killing Private David Lee Collins, 19, during a confrontation at a nightclub in Ayia Napa in the early hours of November 4 last year.

His change of plea from not guilty to guilty saw charges against two of his friends being dropped. 

The two friends, who are now back in the UK put themselves at the scene of the crime but insisted they played no part in the violence.

In mitigation yesterday, Osman’s legal team claimed there was no premeditation when his client stabbed the soldier, and asked the court for leniency.

"That there was no premeditation on the part of the defendant is proven by the facts since the victim and defendant didn't know each other," lawyer Kypros Andreou told judges at Larnaca District Court.

Andreou added that the court should take into account the fact that everyone involved in the brawl had been drinking alcohol prior to the stabbing. 

The mitigation hearing was attended by the mother of Private Collins and the parents of Osman.

A day after being arrested, Osman, who is of Somali origin admitted stabbing Collins, but insisted he was acting in self-defence when he and his friends were allegedly attacked by a group of off-duty soldiers.

Osman claimed he waved a knife solely to intimidate them. But one had “jumped on to the blade”.  

Private Collins was stationed at Dhekelia garrison with the Second Battalion Royal Regiment of Fusiliers.

An autopsy concluded Collins died from a “ruptured heart caused by a sharp instrument”.

Police said a switchblade was recovered at the scene of the crime and 11 similar knives were found in the trio’s hotel room along with a sizeable quantity of cannabis and a knuckleduster.

Osman admitted buying the weapons at a shop in Ayia Napa but said they were to take home as gifts for friends, police said.

Manslaughter carries a maximum life sentence in Cyprus.  State prosecutor Andri Constantinou said Osman may request to serve his sentence in a British jail.

The fatal confrontation happened near Ayia Napa’s central square – an area long out of bounds to all British forces personnel between 5pm and 10am because of previous incidents.