31.03.2022
Christine Lagarde said she was very happy to be back in Cyprus, noting that today they exchanged views on the global economic situation, as well as the drama that is happening next door to Europe as a result of a terrible war. Russia in Ukraine. We discussed the economic implications that this will have for our countries in Europe and in particular in the euro area.
“We are all shocked and frightened by the pictures of war and everyone is doing everything possible to rectify the situation,” she said, noting that the ECB in the euro system and the National Bank of Cyprus are participating in the exercise. “We are trying to ensure price stability, financial stability, but we are also careful about what kind of support can be provided, and we are very interested in ensuring that the sanctions that have been adopted at the European level are also respected and implemented with full honesty and rigor; this is what needs to happen,” she said.
All of this has economic implications, Lagarde noted, and those countries that have developed an extensive service sector are clearly affected. She said that in the past it has been like this: “Cyprus has shown its ability to change, improve, innovate and move from one business model to another and I really hope that this is the case again because it is, of course, the fact that this will affect, in particular, tourism activities.”
“I am fully confident that Cyprus, with the help of its partners, with the help of Europe and other members of the eurozone, will be able to recover, rebalance and return to prosperity and the path it was on before, even during COVID.years that you have shown incredible energy and ability to withstand shocks,” she said.
Lagarde said she was very pleased to see that Cyprus is “not at the far end of Europe, but in the center of Europe” and is a key player and a key member in Europe, and assured that as President of the European Central Bank, the voice of Cyprus is well listened to and he is highly respected at the governing board table and Cyprus plays an important role in Europe and of course, from my point of view, a very important role in the financial circle.
Konstantinos Herodotus said he expressed his gratitude for accepting the invitation and taking the time to visit Cyprus. According to him, Europe, including Cyprus, has already entered a new difficult phase that requires immediate action, and action is being taken both at the ECB and here in Cyprus.
“In these challenging environments, we need to further step up our efforts to create a sustainable growth and financing model by taking all necessary steps. With Lagarde, we are already active on the ECB Governing Council and I am optimistic that we will again face long-term and long-term challenges in the best and most active way,” he said.
Regarding the local banking system, the Governor said that despite the effects of the pandemic and new challenges, he assured Lagarde that it is sound and can absorb any shocks or spillovers as it emerges from bad loans and moves into a new era of technology and automation with sufficient capital cushion and strong liquidity.
