Skip to main content

Fear, despair as bailed out Cyprus faces uncertain future

By Carol Jordan, CNN
updated 10:39 AM EDT, Thu March 28, 2013
Philippos Philippou, an unemployed electrician, stands in line with his mother outside a bank in the Cypriot capital, Nicosia, waiting for the bank to open after a 12-day lockdown on Thursday, March 28. After days of negotiation, Eurozone finance ministers have agreed to terms for a 10 billion euro bailout deal, which aims to prevent the collapse of Cypriot banks and ensure that Cyprus remains in the Eurozone. Philippos Philippou, an unemployed electrician, stands in line with his mother outside a bank in the Cypriot capital, Nicosia, waiting for the bank to open after a 12-day lockdown on Thursday, March 28. After days of negotiation, Eurozone finance ministers have agreed to terms for a 10 billion euro bailout deal, which aims to prevent the collapse of Cypriot banks and ensure that Cyprus remains in the Eurozone.
HIDE CAPTION
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
Bank crisis in Cyprus
<<
<
1
2
3
4
5
6
7
8
9
10
>
>>
STORY HIGHLIGHTS
  • Cyprus' banks reopen for first time in nearly two weeks
  • Cyprus agreed to allow big losses for large deposit holders in exchange for €10 billion bailout
  • Young Cypriots see the bailout and its harsh terms as a threat to their future

Nicosia, Cyprus (CNN) -- "It is a jungle," the taxi driver told me. "It is a jungle and we are the rabbit surrounded by lions." It's a dramatic analogy, but one that accurately sums up Cypriots' disgust and helplessness at what they perceive to be the ultimate betrayal by the European Union.

The last two weeks have been the most dramatic in decades for Greek Cyprus, still reeling from the harsh terms of a €10 billion bailout from international lenders to save the island nation's banking sector. Large bank deposit holders are being forced to take huge losses, and unprecedented limits on the movement of cash have been imposed here.

LATEST: Cyprus' banks reopen for first time in two weeks

The prevailing mood is one of utter helplessness. Greek Cypriots are used to fighting. They fought Turkey for the very land they live on. But today there is no battle to fight against the nameless, faceless group of EU and International Monetary Fund bureaucrats and officials who have now become deeply involved in the future of their country.

Cyprus banks are back in business
Cyprus bailout lessons learned
Weber: Cyprus will be back for more
Cyprus: Template for future bailouts?

"We wanted to be Europe's friend," continues the driver, "but now it is turning on us."

It's difficult not to sympathize. Groups of locals sit in pavement cafes in the capital city of Nicosia, anxiously watching state television, waiting for the next move, waiting for the next development in a seismic event which has rocked the Cyprus economy to its very core. Every interview, every comment is being dissected assiduously.

MORE: Bitcoin currency surges post-Cyprus bailout

The biggest question this week was whether money would really be there when Cyprus' banks finally reopened Thursday. It is, but it can only be withdrawn €300 at a time. But Cypriots are also discussing and arguing about the long-term effects of the bailout. What does austerity mean? How come the Irish and the Spanish didn't lose their savings? Why us?

Walking down Nicosia's main shopping streets, there is little sign of an economic crisis. No queues at the ATMs. Restaurants are busy. Tourists are browsing through the many local stores. Heated discussions over Cypriot coffee can be heard everywhere, and although I can't understand the words, I can sense the frustration.

These people are stuck in a state of limbo. Journalists bandy the term "an uneasy calm" around quite a lot, but it seems a perfect fit to describe the mood here. What's the point in getting angry if you don't know what you're getting angry about? What can you say to the government when their hands are being forced by Europe? What does it all mean for Cyprus?

Ironically, it is Cyprus' youth who seem to have foreseen the long term effect of the bailout. Hundreds of high school students have taken to the streets to voice their dismay over what they see as a threat to their future, though they weren't blaming the government for everything. Placards bearing unflattering comments about the German Chancellor Angela Merkel peppered their morning marches, orchestrated to pass under the gaze of the cameras of hundreds of journalists who set up camp in one of Nicosia's main squares and at the parliament building.

The feeling of worry was palpable. The Russians might lose their money, the young protesters seemed to be saying, but what about us? We could have just lost our future.

I reached the end of the street and at the border crossing stumbled across a completely different, more Turkish side of Cyprus. I walked about 100 meters and spotted the bank. The bank's doors were open, its Turkish flag blowing in the wind. Here people are pleased with the weather. Summer is coming. It's the high season for tourists and hopefully this year will be fruitful. Spare a thought for your Greek counterparts? A shop assistant shrugged.

What the long term effect of this bailout will be is anybody's guess. The rules change every day and while the government insists that the bailout -- and all that comes with it -- is the lesser of two evils, the people sitting in the cafes, those trying to run a business, and the shoe shiner trying to eek out a living remain unconvinced.

The last two weeks have shattered Cypriots' confidence in their country, and the people are fully aware that like a rabbit in the jungle, Cyprus has been well and truly cornered.

ADVERTISEMENT
Part of complete coverage on
updated 3:43 PM EDT, Tue August 27, 2013
German Finance Minister Wolfgang Schaeuble says the eurozone's problems are not solved, but "we are in a much better shape than we used to be some years ago."
updated 11:28 AM EDT, Wed September 4, 2013
The G20 is held in Russia but, amid disagreements over Syria, can anything be done? John Defterios investigates.
updated 11:02 AM EDT, Wed July 10, 2013
Summer could not have come soon enough for Lloret de Mar, a tourist resort north of Barcelona. Despite the country's troubles, it's partying.
updated 1:50 PM EDT, Fri June 7, 2013
The euro club has suffered major shockwaves but its newest member has emerged as an economic star. What;s behind Estonia's success?
updated 9:23 AM EDT, Wed May 29, 2013
The global recovery has two speeds: That of the stimulus-fed U.S. and that of the austerity-starved eurozone, according to a new report.
updated 9:26 AM EDT, Tue May 14, 2013
The flags of the countries which make up the European Union, outside the European Parliament in Strasbourg, France.
The "rich man's club" of Europe faces economic decay as it struggles to absorb Europe's "poor people", according to economic experts.
updated 10:56 PM EDT, Sun May 26, 2013
Europe's competitiveness is threatened as manufacturing companies scrambling to find enough skilled engineers.
updated 11:02 AM EDT, Wed July 10, 2013
Spain's economic crisis is in its sixth straight year yet tourism, worth 11% of GDP, is holding its own, one of the few bright spots on a bleak horizon.
updated 6:44 AM EDT, Thu May 2, 2013
As European financial markets close for the spring celebration of May Day, protesters across Europe and beyond have taken to the streets to demonstrate.
updated 8:10 AM EDT, Fri April 26, 2013
As Croatia prepares to enter the 27-nation European Union, the country's Prime Minister says Italy must return to being the "powerhouse of Europe."
updated 12:56 PM EDT, Thu April 25, 2013
Spain's unemployment rate rose to a record high of 27.2% in the first quarter of 2013, the Spanish National Institute of Statistics said Thursday.
updated 9:55 AM EDT, Mon March 25, 2013
The financial uncertainty in Cyprus is generating images of long lines at ATM machines and anti-European Union protests.
updated 2:15 PM EDT, Mon March 25, 2013
Cyprus will "step up efforts in areas of fiscal consolidation." Where have we heard that before? Oh yes. Greece.
updated 9:39 PM EDT, Fri March 22, 2013
The Cyprus debt crisis is being felt by the banks but also by the people who work at them. Nick Paton Walsh reports.
updated 8:10 PM EDT, Thu March 21, 2013
CNN's Nick Paton Walsh reports on a Russian hotel maid caught up in Cyprus' financial crisis.
updated 12:08 PM EDT, Mon March 18, 2013
Never underestimate the capacity of the Eurozone to shoot itself in both feet, says CNN's Richard Quest.
updated 11:03 AM EST, Thu February 21, 2013
Spain has seen hundreds of protests since the "Indignados" movement erupted in 2011, marches and sit-ins are now common sights in the capital.
ADVERTISEMENT