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Cyprus Economy Gloomy

Makarios Avenue in Nicosia has strung up its Christmas lights but many stores have pulled down their shutters while others are practically empty, reflecting Cyprus's poor economic state.
Malls on the outskirts of the capital are still thriving, but many Cypriots fear the entire Mediterranean island, exposed to debt-ridden Greek banks, will follow in Makarios Avenue's footsteps before too long.
"A few years ago you'd have to pay up to €500,000 in key money to set up shop on Makarios. Now, next to nothing," said Christos Styliou, the owner of a sports store and a games shop.
Mr Styliou's revenue has plummeted 60 per cent in a year, and he has had to let most of his staff go, make his own sales and deliveries, and keep stock at home so as not to pay for storage.
"Many of our clients lost their jobs, some had their salary cut by half," said Georgios Gakos, a veterinarian whose clinic is located in an upmarket area of the capital. "One who was coming once a month [to groom his dog] now comes just for the annual injections."
Dean Millard, a British craftsman who moved to Cyprus 26 years ago, owns a second-hand shop.
"People come to try and sell their furniture," he said. "The Cypriots are too proud to say it's because they need the money, but I know they do. And I can't help them. The only second-hand things that sell now are appliances like fridges and washing machines."
Mr Millard has also had to fire staff and his store barely breaks even. He tried to extend his bank loan for the business, but with interest rates of 10.5 per cent, he decided to borrow money instead from family.
The country has seen 5,000 small and medium-sized businesses fold in the past three years, according to Alekos Tryphonides, a member of the centrist Diko party and a civil service union leader.
Unemployment has risen to 12 per cent of the working-age population, without counting thousands of immigrant workers or illegal aliens, most of whom come from Sri Lanka, the Philippines and Vietnam, and were the first to see the work dry up.
The government has had to draw from pension funds just to afford December's payroll.
Taxes on cigarettes and fuel are increasing, as has the cost of electricity since an explosion in July last year that destroyed the island's main power station.
Many of Cyprus's inhabitants talk of emigrating, saying how a friend, a cousin or a neighbour has already gone to Australia, Germany, Russia.
Greece, however, is no longer an option.
* Agence France-Presse