Financial contagion reloaded: the case of Cyprus
In the present case study, our main objective is to bring to the forefront the main factors that led to the double-dip recession of the Cypriot economy. We analyze determinants such as “tax haven” status, interlinks with the Greek economy, spillovers originating in the Euro Area as a whole (through...
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| Format: | Article |
| Language: | English |
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Nicolae Titulescu University
2013-05-01
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| Series: | Global Economic Observer |
| Subjects: | |
| Online Access: | http://www.globeco.ro/wp-content/uploads/vol/split/vol_1_no_1/geo_2013_vol1_art_008.pdf |
| _version_ | 1818083811134537728 |
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| author | Iulia Monica Oehler-Sincai |
| author_facet | Iulia Monica Oehler-Sincai |
| author_sort | Iulia Monica Oehler-Sincai |
| collection | DOAJ |
| description | In the present case study, our main objective is to bring to the forefront the main factors that led to the double-dip recession of the Cypriot economy. We analyze determinants such as “tax haven” status, interlinks with the Greek economy, spillovers originating in the Euro Area as a whole (through the debt crisis) and Greece in particular. In spite of the fiscal reform of 2002 and the new fiscal system in force since the 1st of January 2003, Cyprus continued to be a “tax haven”. Its high investment attractiveness spurred the “Cyp-Rus” relations, boosted an outsized banking sector (representing 800% of Cyprus GDP in 2010-2011) and generated an unsustainable proportion between the real and the “virtual” economy. Besides, the public sector became larger than required by such a small economy, its share in the total yearly value added being close to one quarter. Taking into consideration all these factors, we conclude that the „W”-shaped recession of the Cypriot economy is a sui generis one and the questioning of its “fiscal paradise” status is even more acute than in the case of countries such as Luxembourg or Liechtenstein. |
| first_indexed | 2024-12-10T19:43:55Z |
| format | Article |
| id | doaj.art-00fb2a6afe1846ecb3c10e5d8820a209 |
| institution | Directory Open Access Journal |
| issn | 2343-9742 2343-9750 |
| language | English |
| last_indexed | 2024-12-10T19:43:55Z |
| publishDate | 2013-05-01 |
| publisher | Nicolae Titulescu University |
| record_format | Article |
| series | Global Economic Observer |
| spelling | doaj.art-00fb2a6afe1846ecb3c10e5d8820a2092022-12-22T01:35:56ZengNicolae Titulescu UniversityGlobal Economic Observer2343-97422343-97502013-05-01116674Financial contagion reloaded: the case of CyprusIulia Monica Oehler-SincaiIn the present case study, our main objective is to bring to the forefront the main factors that led to the double-dip recession of the Cypriot economy. We analyze determinants such as “tax haven” status, interlinks with the Greek economy, spillovers originating in the Euro Area as a whole (through the debt crisis) and Greece in particular. In spite of the fiscal reform of 2002 and the new fiscal system in force since the 1st of January 2003, Cyprus continued to be a “tax haven”. Its high investment attractiveness spurred the “Cyp-Rus” relations, boosted an outsized banking sector (representing 800% of Cyprus GDP in 2010-2011) and generated an unsustainable proportion between the real and the “virtual” economy. Besides, the public sector became larger than required by such a small economy, its share in the total yearly value added being close to one quarter. Taking into consideration all these factors, we conclude that the „W”-shaped recession of the Cypriot economy is a sui generis one and the questioning of its “fiscal paradise” status is even more acute than in the case of countries such as Luxembourg or Liechtenstein.http://www.globeco.ro/wp-content/uploads/vol/split/vol_1_no_1/geo_2013_vol1_art_008.pdfCyprusfinancial contagiontax havenCyp-RusCyprus-Greecerecessioneuro zonedebt crisis |
| spellingShingle | Iulia Monica Oehler-Sincai Financial contagion reloaded: the case of Cyprus Global Economic Observer Cyprus financial contagion tax haven Cyp-Rus Cyprus-Greece recession euro zone debt crisis |
| title | Financial contagion reloaded: the case of Cyprus |
| title_full | Financial contagion reloaded: the case of Cyprus |
| title_fullStr | Financial contagion reloaded: the case of Cyprus |
| title_full_unstemmed | Financial contagion reloaded: the case of Cyprus |
| title_short | Financial contagion reloaded: the case of Cyprus |
| title_sort | financial contagion reloaded the case of cyprus |
| topic | Cyprus financial contagion tax haven Cyp-Rus Cyprus-Greece recession euro zone debt crisis |
| url | http://www.globeco.ro/wp-content/uploads/vol/split/vol_1_no_1/geo_2013_vol1_art_008.pdf |
| work_keys_str_mv | AT iuliamonicaoehlersincai financialcontagionreloadedthecaseofcyprus |