An estimated €16bn bailout for troubled Cyprus is to be delayed by some two months. Banks in Cyprus suffered major loses from Greek debt and loans, and €10bn of the bailout funds would go into recapitalising them. The country’s sovereign debt also stands at 90 percentage points of output, a level the IMF deems unsustainable.

Publically, Cypriot officials have said that the delay stems from a protracted review into its banking sector’s capital requirements but it is rumoured that EU officials are waiting for presidential elections in the country to remove current leader Demetris Christofias, the bloc’s only communist head of state. Christofias has resisted all calls to sell off partially state owned companies as part of any bailout deal, a position that has frustrated the troika of international lenders – the IMF, European Commission and European Central Bank. “We are all quite fed up with Christofias’ lack of willingness to accept the reality of the situation,” a senior official involved in the talks told the Financial Times.

Negotiators estimate that a privatisation deal could bring in as much as €2bn and February elections are expected to bring in Nicos Anastasiades of the centre right Democratic Rally party, a candidate likely to be more amendable to privatisation.