Asia Pacific

The sudden tumble of Cyprus from sun-kissed prosperity into bleak penury must certainly have felt precipitate to many of its citizens – more like a scalping than a haircut, the Financial Times reported. But the collapse is not really the result of a random lurch or shift in axis. It is the end of a path traced in a long, complacent arc of ease and sleaze that hit a wall. It is almost 40 years since the east Mediterranean island was traumatised by partition.

China’s local governments may have more than 20 trillion yuan ($3.2 trillion) of debt, former Finance Minister Xiang Huaicheng said, almost double the figure given in a 2011 report by the National Audit Office, Bloomberg reported. The combined debt of China’s central governments and the nation’s provinces and cities may currently be more than 30 trillion yuan, Xiang, who served as finance minister from 1998 to 2003, said at the Boao Forum for Asia. Local governments had 10.7 trillion yuan of debt at the end of 2010, the auditor said in its report.

New Bank of Japan Gov. Haruhiko Kuroda quickly and dramatically put his stamp on the long-beleaguered central bank, implanting a policy grand in substance and simple in presentation—a stark contrast with his predecessor, who favored incremental steps, emphasizing the complexity and the risks, The Wall Street Journal reported. Using placards with bright red print to explain the complex package of new policies, Mr. Kuroda boiled it all down to the number two: 2% inflation in two years by doubling the bank's purchase of bonds and doubling the monetary base.

European officials have been determined to mend the region's financial market after seeing it torn apart along national lines during the economic crisis. That effort suffered a blow with the radical surgery prescribed for Cyprus's banks as part of March's bailout deal, The Wall Street Journal Brussels Beat blog reported. The agreement will see large depositors in Cyprus's two big, internationally active banks absorb steep losses. Money transfers to and from the island are now sharply restricted.

According to Cyprian newspaper Fileleftheros, Cyprus Airways is about to fold. Because of the cutting of government funds the Cyprian airline company is facing bankruptcy, Fileleftheros reports. According to the newspaper, the Ministers for Traffic, Trade and Labor presented three scenarios about the future of the crippled company: the immediate shutdown of the corporation, the liquidation after the holiday season in summer or the continuing of the air traffic.

Cyprus's bank restructuring, a condition for international aid it needed to stave off bankruptcy, will force the Mediterranean island to scramble for new ways to generate wealth, Reuters reported in an analysis. If it fails, international lenders may have to do what they wanted to avoid and which Germany and its northern European allies may baulk at - give Cyprus more money. Nicosia will get 10 billion euros (8.58 billion pounds) over three years from the euro zone and the International Monetary Fund.

Suntech Power Holdings Co., forced to put its Chinese solar unit into bankruptcy last month, began that slide into insolvency in 2009 when customers linked to the founder couldn’t pay their bills and the company booked the sales as revenue anyway, regulatory filings show, Bloomberg reported. Seven buyers backed by an investment firm funded by Suntech and its founder, Shi Zhengrong, accounted for 29 percent of Suntech’s uncollected bills as 2009 ended, according to correspondence between the solar company and the U.S. Securities and Exchange Commission.

The head of Cyprus’s central bank has sought to deflect blame for the chaos that has engulfed the island’s financial system but has promised a steady lifting of capital controls and played down the risk of a flight of deposits from the country once controls are suspended.

For the past 10 years, Charalambos Alexandrou was one of many Cypriots who helped build his country into a modern Mediterranean paradise. But in the last two weeks, he has watched the foundations of his country buckle under a banking collapse. The severe terms of the country’s €10 billion, or $13 billion, international bailout have tied up everyone’s cash, forced huge losses on the biggest savers and are expected to hasten a deep recession that might take years to overcome, the International Herald Tribune reported. Mr.

Big depositors at Cyprus' largest bank may be forced to accept losses of up to 60 percent, far more than initially estimated under the European rescue package to save the country from bankruptcy, officials said Saturday, the Associated Press reported. Deposits of more than 100,000 euros ($128,000) at the Bank of Cyprus will lose 37.5 percent in money that will be converted into bank shares, according to a central bank statement. In a second raid on these accounts, depositors also could lose up to 22.5 percent more, depending on what experts determine is needed to prop up the bank's reserves.