THE bad news on the economy has been coming thick and fast a fortnight ago, we learned there was a gaping hole in public finances of 600 million euros, likely to send the public deficit spinning beyond the eurozone's permitted threshold of three per cent; last week came confirmation of what everyone has been dreading, as Cyprus officially slipped into recession with its second consecutive quarter of negative growth....

Asked last week to comment on the situation, Finance Minister Charilaos Stavrakis, replied, “I am on holiday. I cannot talk. Thank you.” Well, the holiday is well and truly over for Cyprus, thank you very much.... The danger of course, lies in the favourite recourse to denial, a collective burying of heads firmly in the sand, in which government, opposition and trade unions are complicit, none of them willing to face the grim reality of unpopular remedial action.... Only last December ... Stavrakis spoke of Cyprus as a “financial oasis” in the global economic storm — a startlingly optimistic scenario....

The government can no longer play with figures....

In the first six months of 2009, public sector expenditure rose by 13.2 per cent, while total revenues fell 4.1 per cent. Those revenues will fall further in the second half of the year, making current spending levels unsustainable. There are signs that the government has realised the party's over while the first reaction to the global economic crisis last year was to spend its way out of trouble — an acknowledged economic stimulus that coincided with the communist administration's preference for big government, pumping money into grand public projects and handing out generous social assistance — ministers have now begun to make noises about cuts....

This is a chance for the government to show real leadership by overriding vested interests for the greater good. Will it take that chance, or will it continue ... hoping the problems will just go away? — (Aug 23)