EU ministers have responded to protest in Cyprus and said that small savers should not have to suffer serious losses. Journalist Flora Alexandrou describes the mood of fear and anger in Cyprus in recent days.
DW: Can you describe the situation in Nicosia?
Flora Alexandrou: Nicosia is boiling. You get the feeling that there are journalists everywhere from all around the world, and there was a small demonstration outside Parliament. People are frightened, and they're waiting to see what's going on.
You're referring to the outcome of the vote in Parliament on Tuesday (19.03.2013). So what is the overall mood when it comes to the suggested measures?
People feel anger first of all, and fear. I saw people waiting in front of ATMs over the weekend who were shouting: "Why are they doing this to us? Is this some kind of an experiment?" They say Cyprus is seen as a small country that can be the test tube for the whole of Europe. If this is going to work here, they say, it's going to be applied in other countries. Cypriots are angry because they say they've been working for years and now somebody comes and steals their money. Under the terms of the deal, some wouldn't even lose that much, others are losing more, but still. Last but not least, people are worried: Couldn't they do it again? And regarding Europe, the mood is: If our European friends do this to us, what can we expect from them?
But in other countries, simply put, hospitals had to close and people didn't get their pensions paid out because the state couldn't bail out its banks, like in Spain. So you could argue that in a way, the Cypriot example is a lot more visible, but at the end of the day the effect is not much different.
There are people who see it that way. I have friends who try to calm down others. They say that it may be a bad solution, but it has to be like this because the alternative is we'd lose everything. So it's the less of two evils. But these people are a minority. In general, people are angry.
Who are they angry with?
First of all with Cyprus' European partners. There is also a lot of anger with Cypriot bankers who they accuse of stealing money and doing a lot of damage to the economy. And then people are angry about the government. The last government is criticized because it took so long to get a deal. It took other countries 50 days, and Cyprus needed nine months. So many people accuse the last government of shifting responsibility onto the new government.
Do you know of people who went to the banks before the decision on Friday to take out their deposits?
There are rumors that that has happened. I've been wondering myself, but I don't have any confirmation.
What do you think will happen if Parliament approves the measures?
If they approve it, some people will try to get out their money from their accounts as soon as the banks open again. But I think the media will try to help avoid a bank run. I don't think that we will see what we we're currently expecting.
What makes you say that?
Talking to people you get the feeling that the majority of Cypriots will accept the agreed measures. You have to bear in mind that Cyprus is a closed community, a very small country. Word gets passed on very quickly. If somebody says don't do it, it's not worth it, they help each other understand what the problem is.
What would have been the ideal solution? Cyprus has had a lot of time to play through the various scenarios.
That depends on people's individual political orientation. Some suggested that Cyprus should sell its gas resources to avoid the troika (NE: European Commission, European Central Bank, International Monetary Fund) coming to Cyprus. Other people said we had to accept the troika, there was no way out. A few months ago, in a poll, more than half of the Cypriot population was positive towards getting help from Europe and letting the troika in.
What has changed since then?
They feel that the new terms of the deal violate the law because Cypriots are no longer independent. They say it's robbery.
How do the media in Cyprus assess the situation?
Let me give you my personal opinion as a journalist. What I can see is that in contrast to the Greeks, the Cypriots are reacting more mature, if you will, than the Greek media reacted. We have an open discussion, but with a balanced tone, with analysts who give their different opinions without fighting. That's different from what we could see in Greece.
How much are the Cypriots prepared to take, however? Surely that can change.
If this is only the start, people will get more frustrated. But it takes a lot to get the Cypriots to stage demonstrations.
Do you think that could also have to do with the fact that Cyprus did make a lot of money as a financial center? Is there acknowledgement that the system worked pretty well, but now it's failed and Cyprus has to pay the bill?
In general, people from the working class don't see that aspect. The academic part of the population may acknowledge it, but not the older generation who have had simple jobs all their lives and haven't benefited from Cyprus as a financial center. If you've become rich through something like the tourism industry you may acknowledge it. But ordinary people with shops won't.
But do the media acknowledge it?
Yes, they say Cyprus used to spend a lot in relation to our capacity. We had Russian money deposits in the banks and thought we could get big loans to buy houses and cars. But that didn't work out. That's our mistake and the mistake of the banks. The banks didn't manage the money well.
Do you think Cyprus can get out of the crisis?
I believe that the whole of Europe can make it. As simple as it sounds: We need stability. Politicians need to give their people stability and trust. Then they get away with almost anything. My experience with Cyprus shows me that Cypriots need reassurance. If you tell them you'll have this salary for the next ten years, they'll say OK and will complain less than people in other countries would. And then they'll try to find a different job. But I don't think we'll know where we're at for quite some time to come. Just look at the president. After he was elected, the president guaranteed that there would be no haircut. And then it happened.
According to a poll, 62 percent of Cypriots don't want to leave the eurozone. But there's a rising feeling of injustice. It's a problem that Cypriots have never seen any of the responsible people be sent to prison - a banker or so. That provokes a lot of anger. The media and some politicians are calling for justice, and they have promised that they will change it. But I have my doubts. To restore trust it's important that you show the people that the system works. If a banker does something illegal, he has to go to prison or he has to pay. That's why anger is growing. And that's why the Cypriot government has to deliver on their promises.
Flora Alexandrou is a Cypriot-born journalist who lives and works in Nicosia.