Good morning, and welcome to our rolling coverage of the unfolding crisis in Cyprus.

The Cypriot government is racing to pull together a new plan today to secure its bailout package and prevent the collapse of its banking sector.

This “Plan B” has just been presented to party leaders this morning, and could possibly be voted on later today.

State TV have reported that the plan could include a levy on bank deposits over €100,000, after MPs dramatically rejected the original plan to tax smaller deposits on Tuesday night.

It could also potentially include a new loan from Russia, nationalising pension funds, or restructuring and selling off – or even closing down – parts of the banking sector.

However it is put together, Plan B must raise enough money to satisfy the International Monetary Fund, the ECB and the rest of the eurozone, and unlock Cyprus’s €10bn aid package.

But there are no easy answers in a game of brinksmanship that continues to spread concern across the eurozone, leaving the Cypriot people facing a deeply worrying future.

Meanwhile Cyprus’s finance minister, Michael Sarris, remains in Moscow negotiating with the Russian government. Sarris didn’t appear to make much progress yesterday, raising fears that his dash to Moscow was failing.

Speaking of Russia…European Commission president José Manuel Barroso is in Moscow today for “Dialogue Russia-EU”, and meetings with prime minister Dmitry Medvedev.

Medvedev was scathing about the crisis last night, particularly the plan to tax bank deposits, telling reporters that:

I cannot compare it to anything but some decisions made at a certain period of time by the Soviet authorities that did not care much about people’s savings.

Which should make for a lively meeting….

Cyprus crisis: Government to impose capital controls in dash to meet ECB … – The Guardian
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