By Michele Kambas
NICOSIA (Reuters) - Cyprus re-submitted a controversial privatization law to parliament on Friday in a last-ditch attempt to win support from fractious lawmakers threatening to derail its international bailout program.
The island's opposition-dominated parliament threw out a proposed roadmap for the sale of state assets on Thursday. The 'No' vote raises the risk the island will be plunged back into fiscal turmoil just a year after the 10 billion euro lifeline from the European Union and IMF pulled it back from the brink of default.
Parliament will review the amended privatization motion on Tuesday, one day before a deadline by lenders to approve the plan expires.
Under that plan, Cyprus must privatize its ports, telecoms and electricity companies to raise up to 1.4 billion and pay down debt by 2018. Centre and left wing parties rejected the privatization scheme.
Government officials said the new proposals addressed concerns over legacy rights of workers at corporations which would be privatized.
The setback was particularly galling for the Cypriot government, which has repeatedly earned praise from lenders for exceeding its reform targets.
"A confrontational approach will undermine our interests, and those of our economy," said Harris Georgiades, Cyprus's finance minister. "We have to understand that if we sink, we all sink."
Parliament voted down the roadmap for privatizations in a cliffhanger vote which ended in a tie, but was defeated because of abstentions.
Cypriot President Nicos Anastasiades, who brokered the initial accord with lenders a year ago, said reforms would continue. "I am determined that the country continue its path towards stabilization and recovery," he said on his official Twitter account.
Thursday's vote was reminiscent of a chaotic bailout a year ago, when lawmakers rejected initial bailout terms only to accept considerably harsher conditions from lenders later, including the closure of a major bank.
Parliament's structure, where no one party has an absolute majority, has proven problematic to governments in the past. Cyprus has a presidential system of government, but parliament's chequered profile renders approval of key pieces of legislation, particularly controversial ones, problematic.
Reform efforts were almost derailed in September when parliament again vetoed a bill recapitalizing co-operative banks, before another hastily-convened session hours later approved it.
"We hope to have the consent of parliament so we don't have anything off-tone which affects the credibility and reputation of the Republic of Cyprus, particularly at a time when it is regaining that credibility and things are stabilizing," said Christos Stylianides, the government spokesman.
The Cypriot finance minister has previously warned that the roadmap must be approved by March 5 for Cyprus to receive new aid worth 236 million euros.
(Reporting by Michele Kambas; Editing by Toby Chopra)