NICOSIA - There would be risks to the entire Eurozone if Cyprus was allowed to slide into bankruptcy. This was the warning from Jorg Asmousen, an member of the European Central Bank’s executive board.
In an interview published today in the online edition of the newspaper "Handelsblatt" Asmousen says he expects a rescue package for Cyprus by the end of March, adding that "it is not possible to wait until the federal elections" that will held in September in Germany.
"And there is no doubt: if Cyprus does not receive outside help, it will driven into bankruptcy", says German official.
Noting the risks for the entire euro system from a possible bankruptcy of Cyprus, Asmousen stressed that:
"If we let a systemically relevant country to fall, then we put at risk the progress we have made over the last year to tackle the euro crisis and with high economic and political costs."
He said that a rescue plan was a two way process and explained that the Cyprus Government will have to meet strict criteria. "This means that the banking sector will be significantly reduced."