Monday

26th Jun 2017

Cypriot minister in Moscow as Putin enters bailout crisis

  • Russia - holding the key to the Cypriot debt crisis? (Photo: Holy Trinity Church of Pārdaugava)

Cypriot finance minister Michalis Sarris headed for Moscow early on Wednesday (20 March) for talks with his Russian counterpart, finance minister Anton Siluanov, in the latest twist of the island's bailout drama.

Speaking on Cypriot news channel CNA, Sarris said that he would not leave Moscow until a deal had been reached. "The situation needs to be resolved today," he said, confirming that the meeting with Siluanov would "discuss how Russia could assist in finding the billions needed."

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

The Moscow mission comes as Cyprus seeks an alternative to the controversial €10 billion EU rescue rejected on Tuesday night by the Cypriot parliament.

Following the vote, which did not see a single MP back the bailout, Russian President Vladimir Putin held a phone conference with Cypriot President Nicos Anastasiades.

According to a statement issued by the Kremlin, Putin "expressed concern about possible measures that could harm the interests of Russian legal entities and citizens" on the Mediterranean island.

The statement added that Putin and Anastasiades would "continue consultations on this issue both in a bilateral format and with the European Commission."

Earlier, Putin had described the EU's proposed €5.8 billion one-off levy on Cypriot savers' money as "unfair, unprofessional and dangerous."

The close involvement of Moscow in the Cypriot mess is a new development in the eurozone crisis.

But Cyprus and Russia have had strong links ever since the Mediterranean island declared its independence from Britain in 1960.

Economic and military ties between the two countries advanced since the collapse of the Soviet Union. Some EU officials have in the past referred to Cyprus, which joined the EU in 2004, as Moscow's "Trojan donkey."

Cyprus is officially the third largest foreign investor in Russia, while the island courted controversy and a diplomatic row with Turkey in 1998 after striking a $200 million deal to buy 40 surface-to-air missiles from Moscow.

Credit rating agency Moody's estimates that around €25 billion of Russian money is held in Cypriot bank accounts, with loans worth a further $40 billion (€32 billion) having been pumped in to Russian companies in Cyprus.

Cyprus is also hoping to delay the repayment of a €2.5 billion loan granted by Russia in November 2011.

Meanwhile, early on Wednesday reports on Cypriot TV channel Sigma, and covered elsewhere, indicated that Russian giant Gazprom had submitted an offer to the Cypriot government to take control of part of the country's banking sector in exchange for access and exploration rights to the country's natural gas reserves. Gazprom has yet to make an official comment.

Cyprus rejects bailout deal

The eurozone plunged into uncertainty on Tuesday after the Cypriot parliament rejected its EU bailout plan by an overwhelming majority.

Cyprus struggling on bailout Plan B

With no firm offer from Russia, Cypriot officials are scrambling to find alternative money to secure a €10 billion EU bailout.

Interview

Cheap meat is a bigger problem for climate and health

A leading scholar of sustainability issues has called on the EU to introduce protectionist food policies that impose tough health and environmental standards in order to stop the imports of cheap and poor quality meat.

Interview

Cheap meat is a bigger problem for climate and health

A leading scholar of sustainability issues has called on the EU to introduce protectionist food policies that impose tough health and environmental standards in order to stop the imports of cheap and poor quality meat.

News in Brief

  1. Berlusconi's party sees comeback in Italian local votes
  2. Low turnout in Albanian election set to mandate EU future
  3. Merkel and Macron hold symbolic joint press conference
  4. Juncker has 'no' clear idea of kind of Brexit UK wants
  5. Belgian PM calls May's proposal on EU citizens 'vague'
  6. UK lacks support of EU countries in UN vote
  7. Spain to command anti-smuggler Mediterranean force
  8. Estonia confirms opposition to Nord Stream 2 pipeline

Stakeholders' Highlights

  1. EPSUOn Public Services Day, Stop Austerity! Workers Need a Pay Rise!
  2. EGBAOnline Gambling: The EU Court Rejects Closed Licensing Regimes In Member States
  3. World VisionFaces of Today, Leaders of Tomorrow: Join the Debate on Violence Against Girls - 29 June
  4. ECR GroupThe EU Must Better Protect Industry from Unfair Competition
  5. Malta EU 2017Better Protection for Workers From Cancer-Causing Substances
  6. EPSUAfter 9 Years of Austerity Europe's Public Sector Workers Deserve a Pay Rise!
  7. Dialogue PlatformGlobalised Religions and the Dialogue Imperative. Join the Debate!
  8. UNICEFEU Trust Fund Contribution to UNICEF's Syria Crisis Response Reaches Nearly €200 Million
  9. EUSEW17Bringing Buildings Into the Circular Economy. Discuss at EU Sustainable Energy Week
  10. European Healthy Lifestyle AllianceCan an Ideal Body Weight Lead to Premature Death?
  11. Malta EU 2017End of Roaming Charges: What Does It Entail?
  12. World VisionWorld Refugee Day, a Dark Reminder of the Reality of Children on the Move

Latest News

  1. Cheap meat is a bigger problem for climate and health
  2. Ministers to reject minimum parking spaces for electric cars
  3. Macron’s investment screening idea watered down by leaders
  4. Leaders unimpressed by May’s offer to EU citizens
  5. New Irish PM praises unscripted nature of EU summits
  6. EU extends sanctions on Russia
  7. UK's universities set 'Brexit wish list'
  8. Decision on post-Brexit home for EU agencies postponed