I usually give a little leeway on matters EU, especially when there is confusion between the EU, the European Court of Human Rights and the European Court of Justice. However on this occasion, Jake, no such quarter can be given.
Yes it is very true that this is a decision of the Cypriot government and that other options might be available to them. BUT, if Cyprus was not a member of the EU (or even better if the EU did not exist) Cyprus would not have been using the euro for the last five years. It would have carried on using the Cypriot Pound (which had been tied to within 15% of an fixed euro exchange rate for three years before changeover). The exchange rate at changeover overvalued the Cypriot pound and they were locked into an exchange rate that was hopelessly wrong for the economy. Moving on, Greece would not have been encouraged to borrow billions of euros which it had no chance of repaying and Cyprus would not have been so exposed to this toxic Greek debt in a currency neither country could afford to use
But now comes the big bang and Cypriots must see a sudden 10% drop in their cash holdings. This is a direct result of Cyprus’s membership of the EU and more importantly their adoption of the euro, a bad decision compounded by use of an inappropriate conversion rate. The end result (the effective devaluation of the Cypriot currency) would not have been necessary had it not joined to euro at an overvalued rate five years ago. The euro is not suitable for the peripheral nations and this has been adequately demonstrated yet again. All the Europhiles who keep insisting that the euro’s problems are over are deluded. They are deceiving European citizens, they are causing untold harm and it will not end until the euro in its current form is ditched.