Russia will give Cyprus a loan of 2.5 billion euros at a low rate

It is known that Russia would provide financial support to Cyprus and to open a credit line in January 2012, for a period of 4.5 years at 4.5%. The total allocation of funds to reach 2.5 billion euros. It is noteworthy that this loan will execute in the form of an intergovernmental agreement. Recall that in mid-September, reported the Ministry of Finance of the Russian Federation have reached an agreement to grant Cyprus a loan. As pointed out in The Financial Times, close financial ties between Cyprus and Russia have become a little more closely. These funds will help Cyprus to survive the turbulent times of crisis in Europe. Moreover, Cyprus as an offshore banking center of Russia, will remain a reliable partner. Note that the budget deficit of Cyprus in 2011 will reach 5.5% of gross domestic product, as the banks in Cyprus are highly vulnerable because of the nearby Greek crisis and general financial instability.