Just days before taking over the rotating presidency of the EU from Denmark, the tiny island nation became the fifth eurozone country to ask for a multi-billion euro bailout. The move followed the decision by a credit rating agency to cut Cyprus’ sovereign rating to junk status and an urgent need to recapitalise one of the country’s main banks.

Speaking at the Flemish Parliament last week, Cyprus’s deputy European affairs minister Andreas Mavroyiannis, who has previously worked as the country’s ambassador to Ireland, France, the UN and the EU, said that the bailout was necessary because Cypriot banks had lost €3 billion as a result of last November’s agreement to write off huge swathes of Greek debt. Th e €3bn loss represents almost half of the country’s annual government budget of €7bn and a sizeable chunk of its annual GDP of €23bn.

For a country with a population of just 800,000, providing a lead to the EU for the following six months will be a challenge, 56-year old Mavroyiannis (pictured) admitted to Axel Buysse, Flanders representative to the EU, who was interviewing him before the parliament.

It is the first time that Cyprus has been at the helm of the union since joining in 2004. Because of its distance from the centre of continental Europe, the plan is to pilot a “Brussels-based presidency” with most of the meetings being held in Brussels rather than Cyprus. The country plans to triple the number of civil servants manning its representation to the EU during the presidency, with an extra 150 being drafted in from ministries in the capital Nicosia. Nevertheless, some of the most important meetings will take place in Nicosia, where a former hotel has recently been converted into a conference centre that will be used to host around 15 ministerial meetings between July and December.

The most pressing challenge over the coming months will be trying to find solutions and reaching agreement on solving the eurozone debt crisis. Mavroyiannis said he hoped that roadmaps on banking and economic governance would be in place by the end of the year and that, as a result, Europe would be able “to respond better to the challenges of our times”.

Another key aim will be to make progress on setting the EU’s budget for the period 2014 to 2020, the so-called multi-annual financial framework. “We will build on the work of the Danish presidency in the hope of reaching agreement by the end of the year,” Mavroyiannis said.

Another priority, he said, would be to reach agreement on an integrated maritime policy. The policy, which would provide a framework for a wide variety of activities from fishing, shipping to off shore wind farms, has largely been kicked into the long grass since 2007, when Portugal held the presidency of the EU. Other areas that Cyprus hopes to deliver on include the establishment of a common EU asylum policy and ironing out problems with the border-free Schengen area.

On the same day as Mavroyiannis’ speech to the Flemish Parliament, some 400 Turkish Cypriots marched through the streets of Brussels to protest against Cyprus’ presidency of the EU, claiming that their rights are being ignored.

The protest was a further reminder of the tensions that will accompany the island’s presidency. Turkey has said it will suspend relations with the Cypriot presidency, due to a lack of progress in reunification talks on the island. 

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