Cypriots reacted with shock that turned to panic on Saturday after a 10% one-off levy on savings was forced on them as part of an extraordinary 10bn euro (£8.7bn) bailout agreed in Brussels.
People rushed to banks and queued at cash machines that refused to release cash as resentment quickly set in. The savers, half of whom are thought to be non-resident Russians, will raise almost €6bn thanks to a deal reached by European partners and the International Monetary Fund (IMF). It is the first time a bailout has included such a measure and Cyprus is the fifth country after Greece, the Republic of Ireland, Portugal and Spain to turn to the eurozone for financial help during the region's debt crisis. The move in the eurozone's third smallest economy could have repercussions for financially overstretched bigger economies such as Spain and Italy.
People with less than 100,000 euros in their accounts will have to pay a one-time tax of 6.75%, Eurozone officials said, while those with greater sums will lose 9.9%. Without a rescue, president Nicos Anastasiades said Cyprus would default and threaten to unravel investor confidence in the eurozone. The Cypriot leader, who was elected last month on a promise to tackle the country's debt crisis, will make a statement to the nation on Sunday.
The prospect of savings being so savagely docked sparked terror among the island's resident British community. At the Anglican Church's weekly Saturday thrift shop gathering in Nicosia, Cyprus's war-divided capital, ex-pats expressed alarm with many saying that they had also rushed to ATMs to withdraw money from their accounts. "There's a run on banks. A lot of us are really panicking. The big fear is that there soon won't be cash in ATMs," said Arlene Skillett, a resident in Nicosia. "People are worried that they're automatically going to lose ten present [of their savings] in deposit accounts. Anastasiades won elections saying he wouldn't allow this to happen."
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President Xi Jinping will establish the direction of future China-Russia ties with Russian President Vladimir Putin during his first foreign visit to the country on Friday.
The two leaders will push the China-Russia comprehensive strategic partnership of coordination to a higher level, Chinese and Russian experts said on Monday during a video conference held by Russian Information Agency Novosti.
Xi and Putin will draw up strategies for the future development of bilateral ties and identify fields of possible cooperation between China and Russia, said Wan Chengcai, a researcher of Russian studies at the Xinhua Center for World Affairs Studies.
China-Russia ties are maintaining strong momentum, and Xi's visit shows that China will continue the partnership under the new leadership, he said.
According to Wan, the two leaders may talk about economic cooperation projects that could help achieve the goal of increasing bilateral trade volume to $200 billion by 2020.
Given that the United States is moving its diplomatic focus to the Asia-Pacific region and the world economy is still stuck in sluggish recovery, the two leaders may also discuss international trends and common challenges, Wan added.
Xi's visit shows Russia is still a priority for China's foreign policy, and the two countries will play a constructive role in the healthy development of an international system, said Wu Enyuan, a researcher on Russian studies with the Chinese Academy of Social Sciences.
Choosing Russia as Xi's first destination shows continuity and stability for the China-Russia relationship, which means strategic cooperation between China and Russia will be improved, no matter who leads the two countries, said Alexander Lomanov from the Institute of Far Eastern Studies at the Russian Academy of Sciences.
Xi's visit has more symbolic than practical meaning as it is the first meeting between the new leadership of the two countries, said Lomanov.
China and Russia have enjoyed a healthy relationship since they established diplomatic ties in 1949. The former Soviet Union was the first country to officially recognize New China.
The political ties between China and Russia have developed well as the two countries have set up exchange mechanisms between officials from all levels and the two ruling parties.
The two countries held the same or similar positions on global issues such as UN Security Council reform, global economic governance, climate change, food security and energy security.
Eurozone finance ministers - the Eurogroup - discussed the situation in Cyprus in a conference call on Monday evening.
Following the talks, its president Jeroen Dijsselbloem issued a statement saying the group backed fully guaranteeing deposits below 100,000 euros and said Cyprus would "introduce more progressivity in the one-off levy", provided that the same amount of funds were raised.
He urged "a swift decision by the Cypriot authorities and parliament to rapidly implement the agreed measures".
Earlier European Commission spokesman Simon O'Connor defended the group's actions, saying its original decision on the bailout was "taken by unanimity, all the member states of the eurozone, including Cyprus".
Key officials in the ECB, Germany and France have all insisted Cyprus is free to decide how to raise the 5.8bn euros, but that the money must be forthcoming.
Even if policymakers now
row back from taxing small depositors in Cyprus, the damage has been done."
The Genie is out of the bottle.
We now see what the EU is capable of doing.
In times of trouble, raid the bank accounts of savers, tearing up every legal guarantee of security.
What this tells us is that the EU is the Wild West, where law counts for nothing and there's no sheriff to be seen.
Where was the European Court of Justice at the weekend?
Where were the judges?
Why did no-one step in and tell the 17 bandits of the Eurozone that this was an illegal act?
This is theft - plain and simple - the fact that the Cypriot government put the interests of their richest and most influential citizens above the needs of the ordinary person is a scandal of huge proportions unravelling.
What was Berlin and Brussels thinking by NOT making a few phone calls and telling the Cypriot government that this kind of thinking could be disastrous on a meta-political scale??
I've held the maxim - NEVER TRUST A BANK - ever since I was a young man; they only ever lend to people who don't need it - and always take it away from you when you do. Kind of taking away a person's umbrella when it starts to rain. I've been stung - many people I know have been stung by them. You can not be sure that as well as NEVER TRUSTING A BANK - you can NEVER TRUST POLITICIANS as citizens either.
No wonder the National Rifle Association of American urges all citizens to bear arms in case the government needs overthrowing....!
but the liberals you are referring to and the 'liberal' in this discussed neo phrase are not the same thing and is not meant to be.Neo lib is a different usage ..however in a broader ideological sense you are wrong..regardless of individual opinions there is a connection between the 18th century conceptions and the current 'liberal' politicians.
Folks here are whining about usage of a term...ok why not just call them carpetbaggers?...that just about sums it up. similar methodology...move in..exploit local conditions favourable to you and move out again to new pastures...sounds like capitalism to me.
Little capitalists who support the free market idea are fools.. they have swallowed the game and are the first minnows to get crunched by the big fish...and that is just what the big fish desire...in fact you could invert and apply an old term to small business and working fans of capitalism at this tsgae in history..useful idiots perhaps?
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