Weekend Economists Escape to Cuba March 15-17, 2013

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26. Euro Ministers Push for Cyprus Deal After Merkel Demand

http://www.bloomberg.com/news/2013-03-15/merkel-demands-cyprus-action-amid-clashes-on-haircuts.html

Euro-area finance ministers pushed through the night toward a Cyprus rescue deal after German Chancellor Angela Merkel said Europe must act to support Cyprus after nine months of bailout talks.

Policy makers began meeting at 5 p.m. yesterday in Brussels in a hastily convened gathering, seeking to trim the amount of aid, overcome differences on losses for investors and decide on a role of the International Monetary Fund.

Making way for the currency bloc’s 17 finance ministers, Merkel said that while euro countries won’t provide assistance “under any conditions,” the currency union needed to prevent Cyprus from lurching toward insolvency.

“Simply to leave Cyprus alone and see what happens would be, in my view, irresponsible,” Merkel told reporters in the Belgian capital after a two-day European Union summit. In her wake, the finance officials arrived, along with European Central Bank President Mario Draghi and IMF chief Christine Lagarde, for the Cyprus talks.