Anastasiades asks for Hollande’s support to Cyprus’ plan B’ efforts

President of the Republic of Cyprus Nicos Anastasiades held Wednesday a telephone conversation with his French counterpart Francois Hollande, asking for Paris’ support to Nicosia’s efforts to come out with a plan B’ to overcome its economic crisis.

According to an official press release, Anastasiades and Hollande held a constructive and fruitful discussion.

“During their discussion, the President of the Republic referred to the efforts of the Cypriot government to come up with a plan B’ and asked for the support of the French President in the efforts to ensure part of the 5,8 billion euro with own resources” the press release says.

The Cypriot House of Representatives rejected Tuesday a draft bill on Cyprus` bailout agreement that provides for an unprecedented levy to be imposed on savings in Cyprus banks (haircut), that would amount to 5,8 billion euro. The draft bill was rejected with 36 votes against and 19 abstentions.

The Eurogroup reached Saturday an agreement in Brussels which provided for a levy on savings that stung small account holders to the tune of 6.75% in exchange for a €10 billion sovereign bailout deal, whereas deposits over 100.000 euro would be charged with a 9.9% levy. The agreement also included an increase in corporate tax from 10% to 12.5%.

Excluded from the international markets, Cyprus applied last June for financial assistance from the EU bailout mechanism, after its banks sought state support following massive write downs of the Greek bond holdings amounting to €2.5 billion or 25% of the island`s GDP, as result of the Greek sovereign debt haircut.