NICOSIA, May 17 (Xinhua) -- Cyprus's international lenders expect recession in the crisis-stricken eastern Mediterranean island to be shallower than originally projected, Finance Minister Haris Georgiades said on Saturday.
Announcing the successful conclusion of the fourth review of Cyprus's adjustment program, Georgiades said the technocrats of international lenders adjusted their original projections for a 4.8 percent drop in GDP to a recession of 4.2 percent.
"It was noted that progress was achieved in all sectors of the economy," Georgiades told a press conference after a 2-week review by technocrats of the European Commission, the European Central Bank and the International Monetary Fund.
"They confirmed progress in all important sectors of the economy, such as structural reforms, restructuring of the banking sectors and fiscal control .. The projection for a positive economic development in 2015 remains firm," Georgiades added.
Cyprus was bailed out in March 2013 under a 10-billion-euro (13.7-billion-U.S. dollar) loan agreement which was also provided for the recapitalization of its largest lender with depositors' money and the winding down of another bank which had been overburdened with over 9 billion euros in emergency liquidity assistance from the European Central Bank.
Despite the chaotic conditions brought about by the bailout austerity program and the collapse of the banking system, the Cypriot economy outperformed projections, mainly because of a strong tourism and a resilient services sector.
The Eurogroup is expected to approve on June 19 the release of a 186-million-euro tranche to go towards funding government operations. Cyprus will also receive just under 690 million euros for the servicing of maturing debt.
Georgiades said this amount will not be enough for repaying the full amount of maturing debt and Cyprus had to acquire 100 million euros by issuing a bond through private placement.
Georgiades said Cyprus expects to return to the markets as early as the second half of 2015, two years ahead of troika estimates.