Cyprus – Who’s To Blame – Brussels? The US Navy?
Bruce Krasting | Mar 28, 2013 04:09AM ET
If you listen to the likes of Jeroen Dijsselbloem, .
Short story: In January 2009 the US Navy intercepted a cargo ship filled with munitions. The vessel had come from Iran, and was headed to Syria. The Navy confiscated the munitions and brought them to Cyprus for “storage”. There was a brush fire, and the whole damn thing blew.
The head of the Central Bank of Cyprus had this to say about the July 22, 2011 explosion:
There is an imminent threat of Cyprus joining the European Union Support Mechanism, with everything bad that this entails.
Every day of inaction increases the problems and risks. We must act today, not tomorrow.
Brussels totally ignored this cry for help. Cyprus was forced to go begging to Moscow for an emergency E2.5B reconstruction loan. This was a strategic mistake by both Washington and Brussels.
In preparation for this article I spoke with my friend regarding who he thinks is to blame for the cock-up in Cyprus. He’s biased; he and his family have lost money (there was Greek money involved in the +100k accounts). So he blames Brussels. He also blames the bankers who made the bad loans/investments; he lamented that bankers always make bad loans and never pay. He thinks the depositors ignored all the evidence, including the high yielding deposits, so don’t feel so sorry for them either.
But he also included the US Navy as one of those who must share some responsibility. He may have a point. Those munitions should not have been brought to Cyprus. It was an accident left to happen. Thousands of tons of explosives were stored under a tent. There was huge damage to the infrastructure; the blast leveled a power plant.
Would Cyprus have collapsed if the explosion did not take place? Probably, but the accident made it a sure thing. Is the Navy responsible for accidents? Sure it is:
Is there a lawsuit in this story? I don’t know. Connecting the dots between the Navy’s decision to dump confiscated Iranian munitions in Cyprus, to the losses depositors have felt is a bit of a stretch. But then again you stretch when there’s the odd billion at stake. And then there’s the fact that the Navy has some very deep pockets…..
Notes:
- Navy – Don’t blame me. Someone was going to write this one, just happened to be me.
- Readers from Cyprus, others – do you think the Navy had a hand in what you face today? How? Why?
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