Cyprus is looking for alternatives

There has been a lot of unrest in Cyprus in recent days. In other parts of Europe, too, insecurity among the population is rising. The unrest began on Tuesday when the government came up with the alternative of taxing the savings in the accounts in Cyprus. In this way, Cyprus wants to raise money to pay off the debts.

To prevent a bank run, all bank accounts have been closed. This created a lot of anger and fear among the people of Cyprus.

This proposal was supposed to bring Cyprus $5.8 billion, but was rejected by parliament on Tuesday evening.

Because Cyprus's debt has to be paid off anyway, the government is now looking for alternatives. Crisis talks with political leaders have been in full swing since 9:30 a.m. this morning and will continue late into the evening. They are looking for other alternatives to pay off the debts. An example of this is entering into a partnership with Moscow in order to get more money and support.

There are currently many discussions taking place between Cyprus and Russia on the  financial and energy sectors, with the addition of a loan. The agreements that have to be made for this will have to be in the interest of Russia.

Cypriot Finance Minister Michael Sarris told Moscow on Thursday:

"There are a lot of teams working on a number of issues, some cooperation and support is possible from Russia is." 'Of course we asked for help, but it also has to make economic sense for Russia'.

If Cyprus enters into a partnership with Russia they would like to take out a loan of $2.5 billion. If this alternative is approved, Cyprus would have to seek $5 billion in aid. According to some sources in Moscow, VEB's Russian development bank would have joined the talks.

For the people of Cyprus, there is still little clarity. The bank accounts are closed until at least Tuesday and in many places it is only possible to pay in cash.

Another alternative to get rid of debt is to use the pension pot.

There are about €2 billion to €3 billion in the pension funds of the governments in Cyprus.

An alternative to issuing 'emergency bonds' is also being discussed. The emergency bonds are linked to the proceeds of gas reserves that will take place in the future. This alternative has the disadvantage that the debts will only continue to increase.

MIf the alternative of taxing savings accounts is the solution, exemptions will be granted for all accounts with balances up to €100,000.