Economy

Uncertain Financial Future for Cyprus

Douglas A. McIntyre

Cyprus is in the midst of trying to keep capital in the country, as smart individuals, companies and investors pull money from the troubled nation. The notion that savings could be taxed as a means to raise money was destroyed in parliament. An idea to tax pensions is probably dead on arrival. Aid from Russia, which was the last best hope for Cyprus, has not materialized.

MarketWatch reports:

Doubt over Cyprus’ financial future showed no sign of lifting Thursday, with officials reportedly set to introduce new legislation to try to prevent capital exiting the country, amid negotiations to shore up the country’s finances.

Laws to impose capital restrictions to stem deposit flight from the country and to set out new rules for insolvent banks will likely be put before the country’s parliament on Thursday.

The laws would be needed before the banks reopen their doors to customers — an event now reportedly to take place next Tuesday.