This article talks about the recent 10 billion euro international bailout for the Cyprus financial sector. The plan to go ahead was agreed about a weak back which would help in stabilizing the banking system and government finances. This plan is going to cause heavy loses for depositors in the nations two largest banks the bank of Cyprus and Laiki. Even after a conclusion has reached on the bailout the government has still placed restrictions to make sure that a large sum of money doesn't leave the country as it would cause further damages.The restrictions include a daily withdrawal limit of 300 euros from the ATM machines and a maximum of 1000 euros can be taken out of the country. The new finance minister Harris Georgiades, said that the restrictions would be taken out eventually when the situation starts to stabilize.
The IMF which has agreed to contribute a maximum of 1Billion euro has said that for this bailout to be successful it would require a lot of support from the Cypriot population. Cyprus currently faces high levels of unemployment levels which currently stand at 15% and its GDP fallen by 3.5 % this year. It plans to recover this by increasing taxes and cutting down on government spending. After seeing this crisis the IMF also commented that changes in the banking supervision and transparency would be seen.
http://www.bbc.co.uk/news/business-22014500
The IMF which has agreed to contribute a maximum of 1Billion euro has said that for this bailout to be successful it would require a lot of support from the Cypriot population. Cyprus currently faces high levels of unemployment levels which currently stand at 15% and its GDP fallen by 3.5 % this year. It plans to recover this by increasing taxes and cutting down on government spending. After seeing this crisis the IMF also commented that changes in the banking supervision and transparency would be seen.
http://www.bbc.co.uk/news/business-22014500
It is imperative that economic officials in Cyprus study the causes of this crisis and implement new regulations that will help avoid any more crisis's in the future.
ReplyDeleteIt is important that they find the actual cause for the start of this crisis so it doesn't happen again. Cyprus are also trying to improve the transparency in the banking system which was one of the reason why this crisis started.
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