BRUSSELS, March 19 Russia's envoy to the
European Union likened a proposed tax on Cypriot bank deposits
on Tuesday to forceful expropriation and said it could lead to
the collapse of the Cypriot banking system.
The bank deposit tax, part of a bailout for Cyprus agreed by
the euro zone on Saturday, "seems similar to forceful
expropriation", , Vladimir Chizhov told reporters in Brussels,
in a video conference from Moscow. "The principle ... is wrong."
"This decision is dangerous because of possible social
repercussions in Cyprus and it is dangerous in terms of
triggering possible domino effects in euro zone countries," he
said, speaking through an interpreter.
"And there is another threat. When the banks open, people
will rush to withdraw their deposits - that's another threat -
and then the whole banking system can collapse," he said.
Russians account for much of the billions of euros held in
Cypriot banks by foreign depositors. It banks are heavily
exposed to the island.
Although it is not formally on the agenda, Chizhov said he
expected the Cyprus issue to be raised in talks between the
Russian government and the European Commission in Moscow on
Thursday and Friday.