Cyprus Approves Capital Controls, Solidarity Fund, Bank Split
The Cypriot parliament passed this evening a bill that creates a “solidarity fund,” tapping into state assets to gather the money necessary to obtain a bailout, and another that stops the flow of capital abroad after the banks open on Monday. It also agreed to break up some of its lenders into “good” and “bad” banks in an attempt to get the funds without hurting smaller depositors. Uninsured deposits (those above €100,000) will go into “bad” banks and be frozen. Lawmakers are now debating how large a tax to impose on these deposits to satisfy the demands of the so-called troika (the European Union, or EU, the European Central Bank, ECB, and the International Monetary Fund, IMF) and receive €10 billion in exchange. Yesterday Bloomberg reported EU finance ministers had discussed a possible 40 percent levy on such accounts. This comes only days after Cypriot lawmakers flatly rejected a similar levy on all accounts, including those under €100,000, which are supposedly protected by the EU in such cases, but the troika attempted to force on the small republic. Yesterday the ECB gave Cyprus an ultimatum: it has until March 25 to come up with the necessary €5.8 billion, after which it may risk being expelled from the euro. EU finance ministers are to meet on Sunday to discuss the matter, according to Reuters.
Israel Apologizes to Turkey Over 2010 “Flotilla” Deaths
Israel Prime Minister Benjamin Netanyahu apologised today to his Turkish counterpart Recep Tayyip Erdogan for the death of nine Turkish citizens in the Gaza flotilla incident, and announced that Israel will compensate their families. The diplomatic relations between the two nations will resume as Turkey agreed to drop any legal action against the troops of the Israel Defense Forces responsible for the “operational mistakes” that resulted in the killings and Netanyahu promised restrictions on the entry of goods into Gaza would be lifted. The Gaza flotilla raid incident occurred in 2010, when Israeli forces boarded six ships hired by the Turkish Foundation for Human Rights and Humanitarian Relief and the Free Gaza Movement. They were carrying humanitarian aid and construction materials into Gaza during a blockade imposed by Israel. As they attempted to force the ship into a Israeli harbor for inspection, the troops encountered resistance. The scuffle resulted in the deaths of nine Turks and one American.
U.K. May Lose Second Top Credit Rating, Fitch Says
The U.K.’s lowered expectations for economic growth will probably result in the nation losing a second top credit rating, according to the agency Fitch Ratings. Despite a budget that will prolong austerity until the end of 2017, which Chancellor of the Exchequer presented two days ago, Fitch said the country’s flat economic growth has earned it a “heightened probability of a downgrade in the near term.” The comments come a month after Moody’s downgraded the nation’s debt. This would be the second of three major ratings agencies, with only Standard and Poor’s maintaining its top grade for Britain. Two days ago the government slashed its forecast for growth this year, predicting a 0.6 percent expansion and the national debt rising to as much as 85 percent of the gross domestic product.
Congo “Terminator” Headed to The Hague
Rebel war lord Bosco “Terminator” Ntaganda is in custody and heading to the International Criminal Court (ICC) in The Hague to face accusations of war crimes that include recruiting children as soldiers, keeping women as sex slaves and killing at least 800 people in the east of the Democratic Republic of Congo between 2002 and 2003. Ntaganga, who surrendered himself at the U.S. embassy in Kigali, Rwanda, earlier this week, will received a medical check up upon arrival and appear in court on March 26 at 10:00 a.m. local time (4:00 a.m. EDT), the ICC said. U.S. State Secretary John Kerry hailed this as a victory “justice and accountability.” ”Now there is hope that justice will be done,” he said in a statement.
Weekend Read: The Master
A the Bronx high school Horace Mann begins to compensate former students who were victims of sex abuse, an alumnus looks at a single teacher: Rober Berman. In The New Yorker.