Anastasiades says Cyprus will stay in eurozone
Source: Agencies |
March 30, 2013, Saturday
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THE president of Cyprus said yesterday the risk of bankruptcy had been contained and the country had no intention of leaving the euro, in a speech laden with criticism of Europe's currency union for "experimenting" with the island's fate.
Conservative leader Nicos Anastasiades spoke a day after banks reopened following an almost two-week shutdown to avert a run on deposits by worried Cypriots and wealthy foreign depositors as the country raced to clinch a rescue package from the European Union.
Anastasiades said restrictions imposed on bank transactions in Cyprus - unprecedented in the currency bloc since euro coins and banknotes entered circulation in 2002 - would be gradually lifted. But he gave no time frame.
Cyprus's difficulties have sent jitters around the fragile single European currency zone, and the imposition of capital controls has led economists to warn that a second-class "Cyprus euro" could emerge, with funds trapped on the island worth less than euros that can be freely spent abroad.
In a speech to civil servants in the capital, Nicosia, Anastasiades hit out at banking authorities in Cyprus and Europe for pouring money into a crippled Cypriot bank that now faces closure under the terms of the 10 billion euro (US$13 billion) bailout plan that averted the immediate risk of financial meltdown.
"How serious were those authorities that permitted the financing of a bankrupt bank to the highest possible amount?" Anastasiades said.
"I don't want to say more," he added. "Now is not the time to say who bears more or less of the blame."
The president, barely a month in the job and wrestling with Cyprus's worst crisis since a 1974 war split the island in two, accused the 17-nation euro currency bloc of making "unprecedented demands that forced Cyprus to become an experiment."
But he added: "We have no intention of leaving the euro. In no way will we experiment with the future of our country."
European leaders have insisted the raid on big bank deposits in Cyprus is a one-off in their handling of a debt crisis that refuses to be contained.
The Cyprus rescue differs from those in other eurozone countries because, for the first time, bank depositors have had to take a hit.
Conservative leader Nicos Anastasiades spoke a day after banks reopened following an almost two-week shutdown to avert a run on deposits by worried Cypriots and wealthy foreign depositors as the country raced to clinch a rescue package from the European Union.
Anastasiades said restrictions imposed on bank transactions in Cyprus - unprecedented in the currency bloc since euro coins and banknotes entered circulation in 2002 - would be gradually lifted. But he gave no time frame.
Cyprus's difficulties have sent jitters around the fragile single European currency zone, and the imposition of capital controls has led economists to warn that a second-class "Cyprus euro" could emerge, with funds trapped on the island worth less than euros that can be freely spent abroad.
In a speech to civil servants in the capital, Nicosia, Anastasiades hit out at banking authorities in Cyprus and Europe for pouring money into a crippled Cypriot bank that now faces closure under the terms of the 10 billion euro (US$13 billion) bailout plan that averted the immediate risk of financial meltdown.
"How serious were those authorities that permitted the financing of a bankrupt bank to the highest possible amount?" Anastasiades said.
"I don't want to say more," he added. "Now is not the time to say who bears more or less of the blame."
The president, barely a month in the job and wrestling with Cyprus's worst crisis since a 1974 war split the island in two, accused the 17-nation euro currency bloc of making "unprecedented demands that forced Cyprus to become an experiment."
But he added: "We have no intention of leaving the euro. In no way will we experiment with the future of our country."
European leaders have insisted the raid on big bank deposits in Cyprus is a one-off in their handling of a debt crisis that refuses to be contained.
The Cyprus rescue differs from those in other eurozone countries because, for the first time, bank depositors have had to take a hit.
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