Cyprus’ parliament voted in favour of international bailout

May 1, 2013 | By More

May 1, AP – The bailout passed 29-27 on Tuesday in Cyprus, finalizing the terms stipulated by the European Union and the International Monetary Fund (IMF) in order to receive billions in emergency funds.

human rights observers cyprus parliament voted in favour of bailout eunews 1

Cyprus’ parliament has voted in favor of a bailout from international lenders whose agreement terms have upset worried Cypriots. As part of the deal, depositors must help recapitalize their own banks.

By approving the terms needed to secure 10 billion euros ($13.8 billion) in May, Cyprus’ will require its largest bank, Bank of Cyprus, to absorb its ailing second-largest bank, Laiki. The government will also levy a tax on uninsured depositors at least 100,000 euros in their bank accounts.

Lawmakers also approved public sector pay cuts and a property tax in a separate measure on Tuesday.

Protesters reacted before parliament reached a final decision. Hundreds of demonstrators gathered outside of parliament on Tuesday, some holding signs that said “No, this homeland not for sale.”

Ahead of the vote, supporters of the bill urged members of parliament to help Cyprus save funding for its public sector and avoid a worse financial fate by implementing stringent measures now.

“It is a tough memorandum that will mean the more sensitive groups of society needing to make painful sacrifices along with the rest of society,” Disy party chief Averoff Neophytou said.

“It is the only way because this way, we avoid bankruptcy and we are presented with a prospect to steady the ship in these turbulent waters,” he said.

Opponents of the bill contended accepting the austerity measures posed a threat to Cypriot sovereignty.

“A ‘yes’ from Cyprus’s parliament is by far the biggest defeat in our 8,000-year history,” said Green party MP George Perdikis before parliament. “Its democratically elected representatives have a gun to their head to agree to a deal of enslavement,” he said.

Many remain angry not only over the terms, but the manner in which international lenders appeared to force Cyprus’ government to impose drastic measures without voter approval.

In March, the country’s lawmakers had initially agreed to a more controversial decision which would have imposed a flat tax on all bank account holders in order to recapitalize the island’s banks. However, public outcry forced parliament to renegotiate the terms with its international lenders, ultimately restricting the tax to uninsured depositors’ accounts holding at least 100,000 euros.

Ignacio Damigo, for human rights observers contributed to this report.


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Category: European Crises

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