Cyprus, Merkel’s next Greece?

This video is called Demonstration: Cypriot and Immigrant workers united – Limassol, Cyprus.

By Jordan Shilton:

Cyprus the focus of escalating regional tensions

14 July 2012

The government of Cyprus has indicated its intention to seek financial support from Russia, even as officials from the European Union (EU), European Central Bank (ECB) and International Monetary Fund (IMF) determine the requirements of a potential bailout.

President Demetris Christofias and Finance Minister Vassos Shiarly stated they planned to turn to Moscow for additional support, following the agreement of a 2.5 billion euro loan in 2011. Russian government sources confirmed last Friday that Cyprus was asking for a further loan of 5 billion euros—almost a third of Cyprus’s GDP. The talks have become more urgent after credit rating agencies Fitch and Moody’s downgraded Cyprus’s three main banks to junk status at the end of May.

Shiarly criticised troika policies, claiming that the cause of Cyprus’s economic problems was the deal struck in late 2011 to force a “haircut” on Greece’s creditors. The agreement saw the debt owed by Athens to private creditors cut by up to 100 billion euro. This resulted in losses for Cypriot banks of up to 80 percent of their investments in Greek government bonds, according to Schiarly, totalling 4.2 billion euro.

Speaking as Cyprus assumed the rotating presidency of the EU, Christofias insisted, “We maintain the right to have relations with third countries”.

Akel rejects troika’s austerity measures for Cyprus: here.

Will the ECB carry on bullying governments into doing what it wants? Here.