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In Defense of Cyprus

Cyprus's business model – to serve as an international center for services and trade – has not failed. Rather, Cyprus has fallen victim to a crisis of fiat currency and defects in the management of the financial system.

BERLIN – Greece is said not to have one. Cyprus does, but needs to change it. Luxembourg’s is similar to Cyprus’s, but apparently it is just fine. Malta’s, however, requires more thought. I am, of course, referring to countries’ “business model,” which all sovereign states have lately been deemed to have. Germany, for example, is supposedly an export country.

In addition to Cyprus’s close ties to Greece and Russia, rooted in their shared Orthodox tradition, it has an important historical connection to the United Kingdom, owing to the lasting cultural impact of British colonial rule from 1925 until 1960. For example, English remains the language of education and the lingua franca in Cyprus, and key institutions were modeled on those in the UK.

Cyprus spends 7% of its GDP on education, the third-highest share in the European Union. Many Cypriots attend universities in the UK or North America, with almost four of five students studying abroad. And 47% of Cypriots have a university education, the highest level in the EU.