IMF releases €83.5m loan payment for Cyprus

The International Monetary Fund Friday released the next installment of its bailout of Cyprus, 83.5 million euros ($114 million), a desperately needed support for the struggling eurozone economy. The IMF financing is part of 10-billion-euro bailout package for Cyprus with the European Union. The IMF said the 83.5 million euros were made available to Cyprus following the completion of the IMF executive board's second review of Cyprus's performance under an economic program supported by a one-billion-euro loan approved in May. The new disbursement brings the total amount of the IMF's three-year loan extended to Cyprus to 250 million euros. In return for the bailout, Cyprus agreed to a raft of painful reforms, including a massive downsizing of its banking sector. The international lenders in early November said that the review showed that Cyprus remained on target to meet the terms of its bailout agreement. The so-called troika of international lenders -- the IMF, the European Commission and the European Central Bank -- said in a statement that Cyprus was making progress on structural reforms and recapitalization and restructuring of the financial sector. The lenders forecast that Cyprus's gross domestic product would contract by about 7.7 percent in 2013, or 1.0 percentage point less than previously estimated.