News / Europe

Cyprus Bailout Moves Forward; EU Eyes Bank Stabilization

Cyprus' Finance Minister Harris Georgiades (C) and Central Bank of Cyprus Governor Panicos Demetriades (R) sit with Holland's Finance Minister Jeroen Dijsselbloem in a portrait session at Dublin Castle during an informal meeting, Apr. 12, 2013.
Cyprus' Finance Minister Harris Georgiades (C) and Central Bank of Cyprus Governor Panicos Demetriades (R) sit with Holland's Finance Minister Jeroen Dijsselbloem in a portrait session at Dublin Castle during an informal meeting, Apr. 12, 2013.
VOA News
European Union finance ministers are pushing ahead with plans to bail out Cyprus and stabilize Europe's banking sector.

Ministers meeting in Dublin, Ireland Friday faced questions following reports that the cost of the Cyprus bailout had jumped by several billion dollars.  But EU Monetary Affairs Commissioner Olli Rehn said such worries were not justified.

"People have been comparing apples and pears and coming up with oranges. I will refrain from remarking that this is what happens when stories are written based on leaked documents,'' Rehn said.

The $13 billion bailout plan calls for Cyprus to contribute about $9 billion.  But the costs may still grow.  Rehn confirmed Friday the economic fortunes of the offshore tax haven are worse than first thought.

"We are revising the growth forecast and of course there is plenty of uncertainty about the exact trajectory of economic growth in Cyprus,'' he explained.

Before the meeting, Cypriot Finance Minister Harris Georgiades was resolute. "We have a deal and we shall make it work,'' Georgiades asserted.

The bailout deal Cyprus patched together with international lenders must still be approved by the parliaments of several EU countries before aid can start flowing, as early as next month.

Also Friday, the ministers agreed on the creation of a single supervisory mechanism to watch over European banks.  

Rehn said the move will "further enforce financial stability."

To help ease the financial crunch, Cypriot officials say they are looking at other types of aid, some from the EU.  But to raise additional money, the island could be forced to sell about three-fourths of its gold reserves for about $524 million, levy additional taxes and sell state assets.  

The terms of the bailout have already required Cyprus to confiscate 60 percent of the deposits of its biggest account holders, many of them wealthy Russians.

Such terms continue to upset many Cypriots, like shop owner Ritsa Constantinou, despite her growing optimism that the country's fortunes are improving.

"They shouldn't be so strict. They're choking us," she said. "On the one hand they give us a loan, but they say you have to repay it tomorrow. This isn't possible. If I weigh 100 kilos and the doctor tells me you have to lose weight tomorrow, will I be able to lose it in one day?''    

Such anger may continue to simmer.  Eurogroup finance ministers agreed In Dublin to give Ireland and Portugal  another seven years to repay emergency bailout loans.

Eurogroup President and Dutch Finance Minister Jeroen Dijsselbloem says "Ireland is a living example that adjustment programs do work, provided there is a strong ownership and genuine commitment to reforms."

But Nicosia shop owner Luis Komitis sees nothing wrong with continuing to help Cyprus be accountable.

"I don't believe our partners in Europe want what's bad for us.  I am one of those who believe that Germany, as well as Holland, who we wrongly accuse every day, want what's best for us," Komitis said. "They want to sort out the mistakes that happened in the past, repeatedly, and for many years and by all governments. Germany, and the other countries we accuse wrongly every day, are the ones who want to help us."

Cyprus is the fifth of the 17 nations in the eurozone to need a bailout. But it is the first time that other European countries, the European Central Bank and the International Monetary Fund forced large bank depositors to pay part of the cost.

You May Like

Uganda Court Annuls Anti-Gay Law

Court says law was passed in parliament without enough members present for a full quorum More

Multimedia Thailand Makes Efforts to Improve Conditions for Migrant Laborers

In Thailand, its not uncommon for parents to bring their children to work; one company, in-collaboration with other organizations, address safety concerns More

In Indonesia, Jihad Video Raises Concern

Video calls on Indonesians to join Islamic State of Iraq and the Levant, ISIL More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
In Thailand, Some Efforts to Improve Conditions For Migrant Laborersi
X
Steve Herman
August 01, 2014 6:22 PM
Thailand has been facing increasing international scrutiny as a hub of human trafficking and slave labor. Some of the kingdom’s companies are striving to improve working conditions, especially for the millions of migrant laborers from surrounding countries. VOA Correspondent Steve Herman in Bangkok takes a look at one initiative for children at construction sites
Video

Video In Thailand, Some Efforts to Improve Conditions For Migrant Laborers

Thailand has been facing increasing international scrutiny as a hub of human trafficking and slave labor. Some of the kingdom’s companies are striving to improve working conditions, especially for the millions of migrant laborers from surrounding countries. VOA Correspondent Steve Herman in Bangkok takes a look at one initiative for children at construction sites
Video

Video Public Raises its Voice on Power Plant Pollution

In the United States, proposed rules to cut pollution from the nation’s 600 coal-fired power plants are generating a heated debate. The U.S. Environmental Protection Agency, charged with writing and implementing the plan, has already received 300,000 written comments. As VOA’s Rosanne Skirble reports, another 1,600 people are lining up this week at EPA headquarters and at satellite offices around the country to give their testimony in person.
Video

Video Information War Rages Alongside Real One in Ukraine

The downing of the Malaysian airliner two weeks ago, and allegations that Russians are shelling Ukrainian troops across the border, have moved the information war swirling around the Ukrainian conflict to a new level. VOA's Al Pessin reports from Kyiv.
Video

Video When Fighting Eases, Gazans Line Up at Bakeries

When there is a lull in the conflict in Gaza, residents who have been hunkered down in their apartments rush out to stock up on food and other necessities. Probably the most important destination is the local bakery. VOA’s Scott Bobb reports from Gaza City.
Video

Video China Investigates Powerful Former Security Chief

The public in China is welcoming the Communist Party's decision to investigate one of the country's once most powerful politicians, former domestic security chief Zhou Yongkang. Analysts say the move by President Xi Jinping is not only an effort to win more support for the party, but an essential step to furthering much needed economic reforms and removing those who would stand in the way of change. VOA's Bill Ide has more from Beijing.
Video

Video US-Funded Program Offers Honduran Children Alternative to Illegal Immigration

President Obama and Central American leaders recently agreed to come up with a plan to address poverty and crime in the region that is fueling the surge of young migrants trying to illegally enter the United States. VOA’s Brian Padden looks at one such program in Honduras - funded in part by the United States - which gives street kids not only food and safety but a chance for a better life without, crossing the border.
Video

Video 'Fab Lab' Igniting Revolution in Kenya

The University of Nairobi’s Science and Technology Park is banking on 3-D prototyping to spark a manufacturing revolution in the country. Lenny Ruvaga has more for from Nairobi's so-called “FabLab” for VOA.
Video

Video Immigrant Influx on Texas Border Heats Up Political Debate

Immigrants from Central America continue to cross the U.S.-Mexico border in south Texas, seeking asylum in the United States, as officials grapple with ways to deal with the problem and provide shelter for thousands of minors among the illegal border crossers. As VOA's Greg Flakus reports from Houston, the issue is complicated by internal U.S. politics and U.S. relations with the troubled nations that immigrants are fleeing.

AppleAndroid