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"The government remains committed to meeting its fiscal targets, implementing growth-oriented measures and policies and to securing the necessary funding to cover the state's financial needs," the ministry said. It added that in conjunction with the central bank, it's looking at all options to effectively handle the problems that banks face. Moody's said the scale of the downgrade was limited in light of the government's move to curb public spending and the discovery of substantial natural gas deposits off the island's shores. The hope in the government is that the austerity being pursued will shrink the deficit to around 3 percent of Cyprus' gross domestic product. Longer-term, the gas discovery should support the country's finances too, though Moody's noted that Cyprus won't enjoy the full benefits for at least a decade. Moody's said although the Russian loan helps Cyprus get by this year, there's uncertainty over how the government will secure some euro2 billion to meet its financing needs for 2013. It said that it may turn to Europe's bailout fund for support, but the fact that the government turned to Russia for a loan suggests that it's reluctant to tap EU financing due to the strings attached to such a move. The three countries that have been bailed out
-- Greece, Ireland and Portugal -- have had to enact harsh austerity measures in return for rescue loans.
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