Cyprus’ parliament in a last minute repeat vote passed a privatization bill that the island’s creditors said was a prerequisite for receiving the next tranche of €236 million bailout cash.
"Apart from being an obligation, the privatization program is also an opportunity to attract investment, bolster efficiency and competitiveness and shed the weight of state control on significant sectors of the economy," Finance Minister Haris Georgiades said.
Hundreds protested outside the parliament as MPs passed the bill. The new law provides a framework for the privatization of a host of state-owned concerns, including the electricity and communications utilities. It passed by 30-26 votes following a rejection of the bill on February 27, when the Democratic Party (DIKO) left the ruling coalition after it disagreed with renewed efforts at peace talks with the Turkish-Cypriots.
This time round all of DIKO’s MPs voted for the bill, after revisions were made to addressed some of the issues raised by utility employees and DIKO who wanted a greater sayon privatizations for parliamentariansalong the way.
Cyprus has received a €10 billion bailout from the EU and the International Monetary Fund (IMF). The troika (made up by the European Commission, European Central Bank and the IMF) that oversees the implementation of the country’s economic recovery program had warned that the bill had to be passed by March 5 for it to agree to the release of bailout funds.
The government had warned that another rejection of the legislation could put the country at risk of bankruptcy in the next couple of months.
Cyprus aims to raise €1.4 billion from the privatizations.