Saturday, March 23, 2013

Russia likely will help Cyprus only after EU deal

Russia may help Cyprus only after its deal with EU

Associated Press – Fri, Mar 22, 2013
MOSCOW (AP) — Moscow will help Cyprus out financially only if the country's new money-raising measures get the backing of the European Union, Russia's prime minister said Friday.
Dmitry Medvedev said Russia "hasn't closed the door, hasn't said 'no'" to Cyprus, but will discuss specific assistance to Cyprus only after it reaches a deal with the EU.
"We will only be ready to discuss various ways of support for that state after the EU nations and Cyprus work out a final settlement," Medvedev told a news conference after talks with the European Commission President Jose Manuel Barroso. "We aren't indifferent about it, but the main thing is that this decision is efficient and helps Cyprus find a way out of the very difficult situation it has found itself in."
Cypriot authorities are putting the final touches to a plan they hope will convince international lenders, including its European partners, to provide bailout money to avoid a bankruptcy within days.
Cyprus has until Monday to secure a deal after the European Central Bank warned it would stop providing the country's banks with liquidity on that day if no package is agreed.
Medvedev acknowledged that Russia has "understandable economic interests" in Cyprus. Cypriot banks are awash with deposits from Russian companies and individuals and are thought to total around 20 billion euros ($25.8 billion), or about a third of the total.
Medvedev's comments came after Cyprus' finance minister left the Russian capital without a hoped-for deal.
Russia's Finance Minister Anton Siluanov said Friday, according to Russian newswires, that the Cypriots failed to convince potential investors to buy into a state-owned firm managing revenue from the island's newfound offshore gas. He said Russian bankers equally showed no interests to Cyprus' offer of stakes in some of its banks.
Siluanov also said they were not discussing providing a new loan to Cyprus as the EU has set a debt limit for Cyprus — another loan potentially would raise Cyprus' debt burden.
Barroso said that the European Commission has yet to receive the new Cypriot proposals and urged all the parties to find a quick solution that "would be, of course, good for Cyprus and also, I believe, good for the euro area as a whole."

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