Saturday, 23 March 2013
Varoufakis, Orphanides and Pissarides on the Cyprus economic crisis
Above are three takes on the Cyprus economic crisis, from Yanis Varoufakis, Athanasios Orphanides and Christophoros Pissarides.
Varoufakis, speaking last night on BBC Radio 4, suggests that the Cyprus economic model – which, according to him, entailed the island becoming the Switzerland of the Eastern Mediterranean – was a bad idea from the start and was now, thankfully, dead and buried. On the other hand, Athanasios Orphanides, professor at MIT, and former governor of the Cyprus Central Bank, before he was removed last year by the island’s former president, Dimitris Christofias, speaking to Bloomberg TV on 19 March, defends Cyprus’ economic model, asserting that it was functioning well and was basically sound. He also asserts that the treatment of Cyprus by the EU indicates to him that what we are witnessing now is the ‘slow death of the European project’. Nobel prize-winning economist Christophoros Pissarides, recently appointed head of Cyprus’ Economic Policy Council, being interviewed by Channel 4 News last night, can barely contain his outrage and disgust at the way the Troika has perfunctorily wreaked havoc on the Cyprus economy, which, like Orphanides, he suggests was fundamentally healthy. Pissarides asserts that the problems facing the banking sector in Cyprus could have been overcome without a wholesale repudiation of the island’s economic model.