NICOSIA, Cyprus — Politicians in Cyprus were racing Saturday to complete an alternative plan raising funds necessary for the country to qualify for an international bailout, with a potential bankruptcy just three days away.
Finance Minister Michalis Sarris said "significant progress" had been made, and that new legislation raising funds could be completed and debated in Parliament as early as Saturday evening, although the timing was not certain.
Cyprus has been told it must raise 5.8 billion euros ($7.5 billion) in order to secure 10 billion euros in rescue loans from other European countries that use the single currency, and from the International Monetary Fund. The country's lawmakers soundly rejected an unpopular initial plan that would have seized up to 10 percent of people's bank accounts, and is now seeking a way to raise the desperately needed money.
Time is running out fast. The European Central Bank has said it will stop providing emergency funding to Cyprus' banks after Monday if no new plan is in place. Without ECB's support, Cypriot banks would collapse on Tuesday, pushing the country toward bankruptcy and a potential exit from the 17-nation eurozone.
Banks have been shut all week while the plan is put into place, and are not due to reopen until next Tuesday. Cash has been available through ATMs, but many run out quickly, and those machines for the troubled Laiki Bank are only dispensing 260 euros a day.
Nicosia made a significant step towards cementing a new plan Friday night, when its lawmakers approved nine bills, including three crucial ones that will restructure ailing banks, restrict financial transactions in emergencies and set up a "solidarity fund" that will act as the vehicle for raising funds from investments and contributions.
The bank restructuring will include the country's troubled second largest lender, Laiki, which suffered heavy losses after being exposed to toxic Greek debt.
Thousands of angry bank employees afraid of losing their jobs marched through the center of Nicosia to the Finance Ministry and Parliament, some with placards around their necks reading: "No to the bankruptcy of Cyprus." They marched up to the front of the ministry, calling on President Nicos Anastasiades to resign and chanting, "Anas, you took our homes away from us."