Spiegel: Just a kick in the balls of Greece and, hey, success in Cyprus

From the trusted department of the @Spiegel: How low and stupid can we go?

The Spiegel guys felt there were too many headlines on Greece, even as it now has become the dumping ground of refugees grâce à la stupidity of the most powerful female politician in the world. So head a hundred sea miles down south and report some real good news from Cyprus.

Why Cyprus did not become a second Greece

It's in German but the gist is,

The Cypriots are praised by their sponsors: "Economic growth and fiscal results continue to exceed expectations," it says in the last IMF report. Even the Nobel laureate Christopher Pissarides is satisfied. The completion of the program was a "great success story," said the native Cypriots SPIEGEL ONLINE. "Cyprus is moving toward a solid, sustainable recovery."

How awesome is the economy? Pretty:

Yet unemployment is, however, at 15 percent, the growth this year is estimated to be more modest 1.5 percent. Under these circumstances, finds journalist Seitanidis the word "success story" slightly high but a model could already be his home. For the responsible actions of politicians

Well let's look here. These are 2015 numbers. GDP, but keep an eye on the numbers of 2013 and 14:

The Gross Domestic Product (GDP) in Cyprus expanded 0.4 percent in the fourth quarter of 2015, slowing from a 0.5 percent growth in the previous three months, preliminary estimates showed. GDP Growth Rate in Cyprus averaged 0.30 percent from 2001 until 2015, reaching an all time high of 2 percent in the first quarter of 2007 and a record low of -1.90 percent in the first quarter of 2013. GDP Growth Rate in Cyprus is reported by the Statistical Service of the Republic of Cyprus.

GDP per capita here. Nice.

Now something unpleasant and typical EU South, unemployment.

Unemployment Rate in Cyprus decreased to 15.30 percent in January from 15.70 percent in December of 2015. Unemployment Rate in Cyprus averaged 7.38 percent from 2000 until 2016, reaching an all time high of 16.90 percent in October of 2013 and a record low of 3.30 percent in March of 2002. Unemployment Rate in Cyprus is reported by the Eurostat.

Fancy the inflation rate, where the ECB target is 2%?

Consumer prices in Cyprus dropped 2.60 percent in February of 2016 following a 1.3 percent fall in the previous month.

Ready for government debt to GDP?

Government Debt in Cyprus is expected to rise to 108.4 percent of GDP in 2015 from 108.2 percent in 2014, according to European Commission's Winter 2016 Economic Forecast. Government Debt to GDP in Cyprus averaged 66.21 percent from 1995 until 2014, reaching an all time high of 107.50 percent in 2014 and a record low of 48.90 percent in 2008.

Sure, there is still something lurking in the closet. Like NPLs. Nothing to worry, as some have only stopped serving those loans as they watch developments from the beach front.

Although the Institute sit according Zentralbank still nearly 50 percent on bad loans. Giannis Seitanidis, head of the economics department at the Cypriot newspaper "Politis", this figure considers it highly exaggerated. Many borrowers had their loans only temporarily not served, because they wanted to await further developments. Moreover, the number of bad loans through a new law is expected to sink facilitates foreclosures.

This gentleman begs to differ.

The loans, mainly non-performing but not only, will be sold at huge discounts. Some experts go as far as predicting that the price to various funds and other anxious takers will be even below the amount provided for by the Banks.  That in itself is very alarming as this will inevitably create further losses which will need to be covered by new capital. But the huge paranoia is with regard to the general belief that is put forward by some politicians in particular which suggests that if only we could somehow sell off the non-performing loans we will also get rid of the problem. What they fail of course to point out is that loans (whether non-performing or not) are assets that the banks hold and which secure the repayment of deposits and other obligations they have.  It is not serving anyone, least of all the tax payers who will inevitably be called to recapitalise a failed bank, to allow the current shareholders of our banks to sell off these assets at will and without regulating the price so as to ensure maximisation of value for the bank.

Read the whole.