Cyprus to stay within eurozone: president

Cyprus President Nicos Anastasiades said on Friday that the eastern Mediterranean island will stay within the eurozone following a bailout deal with the Eurogroup which involves crippling conditions which have stunned the population.

The forced closure of one of the two Cypriot largest banks and a deep haircut on deposits over 100,000 euros (129,000 U.S. dollars) in the largest bank have led authorities to impose curbs on bank transactions which have brought commercial activity to a standstill.

Depositors have behaved calmly when banks reopened on Thursday after 14 days and Anastasiades issued a message of appreciation for their sense of responsibility.

"I am confident that the people will find its way again and the government is determined to offer new incentives for foreign investment," said Anastasiades in an address to a conference of public servants.

"Our economy will be saved even if we have to face difficult decisions ahead," he added.

Cyprus turned to the Eurogroup and the International Monetary Fund for financial support when it became evident that its banking system was near collapse by the middle of 2012, but harsh measures were demanded by lenders in exchange for a 10 billion euro bailout.

They asked for measures which in practice amounted to the dismantling of the two biggest lenders, the Bank of Cyprus and the Cyprus Popular Bank, accusing the banking system of indulging in the laundering of Russian money and also demanded measures dissuading foreign investment, among them an increase on a low 10 percent corporate tax which had lured thousands of offshore companies to Cyprus.

Anastasiades dismissed demands by some political sectors for Cyprus to leave the euro area and to do away with lender's demands and restrictions.

"We will not experiment in any way with the future of our country," Anastasiades said.

Cyprus is looking to bailout money soon as the state is running out of money and a 1.5 billion euro debt is maturing in June.

Labor Minister Haris Georgiades said on Friday that given the dire economic situation of the government, the final bailout deal has to go before a Eurogroup working team on April 4, so as to be endorsed by European parliaments by the end of the month.