"I don't think it's helpful for the economy of Cyprus to be raising this issue because the 10 percent rate is one, but not the only one competitive advantage that a service economy like Cyprus needs to have in order to protect its public finances and economy in order to pay its loan from international creditors."
He also dismissed speculation that more, tougher austerity measures may be needed to clinch approval for the bailout from fellow Eurozone states.
"If we start messing around and adding more measures, there is a risk that the program becomes less consistent, there is a risk that the recovery won't happen as predicted," Demetriades said. "Although Cyprus is a small country, history teaches us that even small events can trigger large crises."
Demetriades acknowledged that Cypriot authorities may have been at fault for delaying bailout talks last year, but the country — which has enough cash on hand to pay public sector salaries until March — is ready to sign "yesterday."
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