Moscow hopes Cyprus won't need its help
Russian Prime Minister Dmitry Medvedev said Moscow needs to study the consequences for the country of the Cyprus bailout deal agreed in Brussels. President Vladimir Putin has ordered the restructuring of the € 2.5 billion loaned to Cyprus in 2011.
Russia’s Prime Minister Dmitry Medvedev said Moscow needs to
study the consequences of the Cyprus bailout deal agreed in
Brussels, especially for Russia. Meanwhile Vladimir Putin ordered
to restructure the € 2.5 billion Cyprus loan issued in
"We have to figure out what this story turns into in the long
run, what the consequences for the international financial and
monetary system will be - and thus, for our own interests as
well," Medvedev said in Russia's first official reaction to the
deal agreed over the weekend.
As the EU 10 billion bailout loan has been secured, First Deputy
Prime Minister Igor Shuvalov, a close ally of President Vladimir
Putin, said "the situation looks like no further help [for
Cyprus] from the Russian government will be required."
He added that Moscow will reconsider extending the loan to
Cyprus due to be repaid by 2016, after studying the full details of
the Brussels package.
On Monday spokesperson Dmitry Peskov said President Putin
instructed "the government and the Russian ministry of finance
to work with their partners on the issue of restructuring the loan
previously issued to Cyprus."
'Stealing what's already been stolen'
Analysts believe that Russian depositors whose savings in
Cypriot banks total around €25 billion will suffer the most from
the “haircut”. The Financial Times reports almost one third of all
deposits in Cyprus belong to Russians, which is more that the
“Let’s speak about what’s going on in Cyprus. In my view they continue stealing what's already been stolen,” Dmitry Medvedev said.
According to Medvedev it’s very important that “actions of
those, who withdrew money from the Russian economy, were assessed
by the government.” In this case, those people “could be
brought to justice and their money could return to Russia,” the
Russian Prime Minister added.
“Europe today is in a situation comparable to that of the
French revolution or the Bolshevik revolution. By that I mean an
entire class of people, in this case the so-called rich Russian
oligarchs, who apparently have been laundering their money in
Cyprus bank accounts, are going to be expropriated, not taxed, and
treated as if they were criminals,” John Laughland, the
director of studies at the Institute of Democracy and Cooperation
in Paris, told RT.
“It’s just as in the two revolutions I mentioned aristocrats
were hung on the lampposts because it was decreed that their
property had been criminally obtained. This is a very bad
precedent, because it means that bank deposits, which are private
property, are no longer safe in European banks.”
Cyprus and the European creditors are yet to agree on the final
details of the deposit “haircut” agreed within the 'Plan B'
emergency legislation. The new rescue plan calls for a one-off
fixed levy on large deposits.
Depositors in the Bank of Cyprus, the biggest bank on the
island, will reportedly lose "around 30 percent" on their holdings
above €100,000, the chairman of the Cypriot parliamentary finance
committee said on Monday.