economy – is the huge number of non - performing loans. there is an ongoing debate in cyprus about how the country will handle this problem, a debate which practically “ freezes ” the last review of the cypriot economic adjustment programme. do you see any signs of a derailment of the cypriot programme? what might be the effects on the banking system? cyprus has a remarkable track record in implementing the conditionality of the programme. one of the key objectives of the programme is to reduce the high level of non - performing loans and restructure the excessive indebtedness of the private sector. this is a key condition for the banking system to be in a position to finance economic growth and job creation. in this respect, a swift adoption of the insolvency framework and application of the foreclosure framework are not only key elements to guarantee compliance of cyprus with the programme, but also essential to support the economic recovery. bis central bankers ’ speeches the main political goal of the government is to conclude the programme and the financial assistance provided by the troika earlier, probably before the end of this year. the ecb is part of the troika. as such, does it consider this goal achievable? whether or not there should be a follow - up arrangement is for the cypriot government to decide. what matters to the ecb is to establish the conditions for sustainable growth and for a lasting return of cyprus to market funding when the programme ends, i. e. in the spring of 2016. to this end, it will be essential that the banking sector has turned the corner and the non - performing assets have been addressed. the ecb is starting its programme of quantitative easing ( qe ). how and when can cyprus benefit from that? cyprus should and will benefit from our asset purchase programme. this will be possible whenever the review is successfully concluded. many analysts interpret qe as europe ’ s first step away from austerity programmes and towards more growth - friendly policies. i also read that inflation is the safest way for european countries to reduce their debts and the ecb will help them move in that direction with its qe. in that respect, is qe a programme created as a result of economic need, of political pressure, or as a result of fear for the future of the euro? the ecb ’ s sole mandate is to maintain price stability for the euro area as a whole, which we define as consumer price inflation being below

the country has and will have specific financing needs over the next 18 months. is a new programme for greece a scenario that ’ s being considered? the eurogroup has outlined a clear sequence. when the current review is concluded successfully, and if the greek authorities so wish, a follow - up arrangement will be discussed with the eurogroup. but it is first and foremost the responsibility of the greek government to create growth and regain financial independence. this requires in my view a clear resolve to boost economic reforms, a prudent fiscal path and an unequivocal confirmation that greece will honour its international commitments. doubts about the country ’ s creditworthiness will then recede and foreign investors will return to greece. the new government is negotiating with the european commission, the ecb and the imf in full awareness of the fundamental hypothesis that in the end no one would want a grexit. if that is true, why didn ’ t europe realise earlier that the greek programme was not working effectively? the recession and unemployment in greece cannot be compared with the recession and unemployment in cyprus, ireland, portugal and spain. my question is : would a failure of the programme eventually undermine the future of the euro area? from a very difficult starting position, and through painful efforts, greece has made good progress in restoring fiscal and external sustainability, as well as in putting banks on a sound footing and strengthening the basis for growth and job creation. by the end of 2014, economic indicators were clearly pointing to positive growth and better prospects ahead. indeed, in its forecast released one month ago, the european commission expected greece to grow by 2. 5 % in 2015 and 3. 6 % in 2016, one of the highest growth rates in the euro area. and the arduous efforts of the greek people need to be recognised here. but let ’ s not fool ourselves : adjustment was inevitable and, believe me, it would have been much worse without european and international support. that said, we should always learn from the past. for instance, i believe that the programme should have put more emphasis, at an earlier stage, on reducing rents – in the economic sense – and fighting vested interests in the greek economy, to allow for a fairer sharing of the adjustment burden. also, in its crisis - fighting toolbox, europe did not have at its disposal instruments available to institutions such as the world bank, which supports social safety nets when countries undertake structural adjustment. according to some rumours, the ecb played a