Cyprus faces last ditch chance to save economy

[dipsydoodle]

Source: Reuters

(Reuters) - Cypriot President Nicos Anastasiades, seeking a last-minute reprieve from financial meltdown at talks in Brussels on Sunday, has a "very difficult task" ahead of him if he is to save the island's economy, a government spokesman said.

With Cyprus facing a Monday deadline to avert a collapse of its banking system and potential exit from the euro, late night talks in Nicosia to seal a bailout from the EU and International Monetary Fund broke up without result.

Anastasiades then headed to Brussels in a private jet sent by the European Commission to hold talks with EU, European Central Bank and IMF leaders ahead of a crunch meeting of euro zone finance ministers at 6 p.m. (5 p.m. British Time).

The president and his team have a "very difficult task to accomplish to save the Cypriot economy and avert a disorderly default if there is no final agreement on a loan accord," the spokesman said.

Read more: http://uk.reuters.com/article/2013/03/24/uk-eurozone-cyprus-idUKBRE92F07R20130324

[Benton D Struckcheon]

1. 'Banco de Mattress’ looms for Cypriots

It amazes me that they didn't think of Cyprus after they finished taking care of Greece. Stunning incompetence.
Or as John Dizard notes in this week's FT, (http://www.ft.com/intl/cms/s/0/71bc9bec-6a32-11e2-a7d2-00144feab49a.html#axzz2OT83INEM) Through their bumbling and stumbling, the European authorities have shown that you better think ahead and prepare, since it’s clear that they don’t.

Exactly right.

[another_liberal]

2. The system itself is broken . . .

The system itself is broken, nothing short of a complete restructuring can save our international economy from more and worse disasters. The current style of unrestrained Free Market Capitalism which dominates financial systems World-wide is unavoidably flawed. The good of the many can never be properly served by a system based solely on personal greed as it's motivation and driving force. The age of neo-liberal Capitalism is clearly over, and the sooner we recognize that fact the better for us all.

[LiberalLovinLug]

3. I am truely naive about economic etc..

But looking at it in that naive perspective, I don't understand why Cyprus, or for that matter Greece can't just grow their own food and make products for each other, and sell off shore any exports like Olive oil etc to companies directly. Its not like they are living off of a dry parched desert. Create a new co-op Credit Union and go back to their old currency if they think they need an institution. And tell the World Bank, the WTO, and the IMF to go fuck themselves....and they'll pay them back whenever things are better.
Would they be militarily invaded or something? What good would that do?

[amandabeech]

4. Many commentators are suggesting that Cyprus leave the Euro

and go back to the Cypriot lira. That would allow them to do what you write.

There's been a lot of talk of various economically crippled countries that use the Euro to return to their old currencies: drachmas for Greece, pesetas for Spain, lira for Italy.

The Euro is something of a straight jacket for many, or so I've read.

[pampango]

10. Here's one: Head of Cyprus's Orthodox church urges exit before eurozone collapses

The powerful head of the Orthodox church in Cyprus recommended his country prepare to abandon the euro as talks on an EU bailout came down to the wire. Archbishop Chrysostomos II endorsed the position, increasingly popular inside Cyprus, alongside an appeal to Russian investors to continue banking with the island despite the threat of a government raid on their deposits.

"The euro cannot last," Chrysostomos told Realnews, a Greek newspaper. "I'm not saying that it will crumble tomorrow, but with the brains that they have in Brussels, it is certain that it will not last in the long term, and the best is to think about how to escape it.

The archbishop's comments carry considerable weight on the island, and not just because of his religious position. More than just a spiritual haven for Cypriots, the Orthodox church is the country's biggest landowner and a major investor in everything from hotels and construction to a brewery. It also holds a majority stake in Hellenic Bank, Cyprus's third biggest.

Chrysostomos said in a second interview, published on Sunday, that he would appeal to rich Russian investors not to flee the island. A proposed levy on accounts over €100,000, designed to contribute to underpinning of a tranche of the bailout worth €5.8bn (£4.95bn), would hit foreign investors particularly hard. Russians are believed to hold nearly half of all deposits in Cypriot banks.

http://www.guardian.co.uk/world/2013/mar/24/cyprus-orthodox-church-exit-eurozone

[joesdaughter]

5. How this happened

Cyprus became a tax haven.

http://www.grandforksherald.com/event/article/id/259638/group/Opinion/

[dipsydoodle]

7. Its not a tax haven

Its a low tax jurisdiction fully compliant with OECD rules. Its on their white list for bi-lateral double taxation treaties with all developed nations.

That's not splitting hairs - there is a complete diference.

[joesdaughter]

8. Thanks

I am obviously out of my league here. Your response will require some homework on my part to get a better grasp of the situation. I have family who worked for State and they were posted there for several years in the late 60s. I tried to keep up with the news from Cyprus. I just could not understand how this former Greek/Turkish chess piece got into so much trouble.

[dipsydoodle]

9. You'd posted a good artilcle never the less.

I just happened to pick up on that bit.

[riderinthestorm]

6. Well we should know the resolution soon since the meeting's underway nt

[dipsydoodle]

11. Meeting was delayed

and has yet to start.

[Bosonic]

12. ...and now bombs!

Now-bang in a bank in Cyprus

Blast occurred a few minutes ago in Bank of Cyprus, Kato Polemidia, Limassol.

Under lemesos-blog.com explosive device placed at Bank of Cyprus, Kato Polemidia, Limassol.

Specifically the explosion destroyed the window of a branch of the Bank. The area has been blocked by the Cypriot police.

http://www.google.com/translate?hl=en&ie=UTF8&sl=auto&tl=en&u=http%3A%2F%2Fwww.enikos.gr%2Feconomy%2F131361%2CTWRA-Ekrhxh_se_trapeza_sthn_Kypro.html