As tourists stay away – apart from Russians – islanders fear for their families and their future
"How's business?" the taxi driver shouts, echoing the question. "It's terrible! Terrible!" Chris Georgeo, 52, is at the wheel of his beaten-up minibus negotiating the tight roads of Larnaca, the holiday resort on the south-east coast of Cyprus, but he still takes both hands off the wheel to give a double thumbs down.
"We can't survive, there are no jobs," he says. "There are far less tourists. They're scared to come here after the TV reports showing people not being able to get money out of the banks."
In March, Cyprus's banks froze all withdrawals and savers with the Bank of Cyprus later learned they had lost 47.5% of their savings above €100,000 (£86,000), while savers with Laiki Bank lost all their money above €100,000 as part of a deal to secure a €10bn (£8.6bn) bailout from the European Union, European Central Bank and International Monetary Fund.
Earlier it had been feared that all savers, no matter how much they had in the bank, would be forced to surrender a slice of their money. There had been panic. "Tourists are what makes this island: without them we have nothing," Georgeo says.
It is the height of the tourist season and the latest figures from the Cyprus Central Bank say visitor numbers in June fell by 6.6% to 308,000. But anecdotal reports suggest things are far worse than that number would indicate.
"Look, it is just you in my bus," Georgeo says. "Last year it would have been full, now it's just you … My boss won't make money. He'll cut my pay again, or go bust."
Even if he keeps his job, Georgeo, who is going both bald and grey and whose jeans have so many holes I could tell you what sort of underwear he was wearing, says he "can't afford life". His monthly pay has been cut from €1,100 to €800: "I've got to pay rent, electricity, water, food – which keeps going up – and have two daughters at university in England. I've got to send them money. But I can't."
It's a similar story everywhere. Unemployment in July officially stood at 17.5%, at a record of more than 48,000 people. Surveys suggest the true figure is closer to 70,000, accounting for those who do not register for unemployment benefit, which is stopped after just six months.
Cypriot unemployment is the third- highest in the EU, behind Greece (26.9%) and Spain (26.3%). This compares with just 4.6% in Austria, 5.4% in Germany and 7.8% in the UK.
As in other troubled areas of Europe, young people are particularly badly affected. Official youth unemployment stood at 37.8% last month, up from 26.4% last month and far above the 13.8% long-term average. The official unemployment rate – which is 32% higher than this time last year – is likely to spike far higher at the end of the summer season because thousands are employed in temporary tourism-related jobs.
Cyprus has entered its third year of recession, with GDP showing a 5.4% decline in the second quarter compared with last year. Tourism accounts for almost a third of the island's GDP.
Maria Eracleous, a British-born Cypriot single mother, has just got a job 10 months after being one of hundreds laid off by Larnaca airport – the country's busiest because the airport in the capital, Nicosia, has been closed since the 1974 Turkish invasion and remained in a United Nations buffer zone for years.
"It's much, much less money, but at least I have a job – half of my friends are unemployed," says Eracleous, who earns €700 a month as a receptionist at the Amorgos boutique hotel set back from Larnaca's beach behind two larger 1970s tower block hotels. "But I worry about how long it will last. Lots of immigrants will work for less. If I make it to the end of the season, that'll be a relief, but then what will I do in the winter?"
Eracleous came to Cyprus in the good times of 2008 to be with the father of her 14-year-old son, but now the strain is beginning to show. And that worries her too. "We still have to offer good holidays, we still have to make people happy," she says. She pauses as a tanned British couple in vests, shorts and sandals approach the reception desk, and breaks into a bright white smile. "We still have to smile, at all times."
Zivile, a 26-year-old receptionist at Sun Hall Beach hotel, the tallest hotel lining the beach,, says the rooms are 30% empty despite it being the middle of the peak season: "We're not busy, it's very quiet. People have decided not to come, they know it's not so good here. They have probably decided to go somewhere else, somewhere cheaper. Because of the euro, we can't be that cheap."
On the waterfront, a group of elderly men are playing harmonicas for tourists outside the unfortunately named Hobo's Steak House. They look like they might be homeless. In the restaurant there are customers at only 12 of more than 50 tables. Down the strip, the Times bar is just one of several bars and shops boarded up. The Paradiso beach bar is open, but there are no customers.
"Normally, this would be buzzing," says 23-year-old barman Vassilis Koursaris. "Now there's no one. There must be 70% less tourists."
Koursaris, who is Cyprus's top archer and training to compete in the Rio 2016 Olympics, says that even when there are customers they don't spend as much: "People used to spend big and not worry about money. Now they buy one drink and drink it slowly."
Last weekend, he says, the bar made only €2,000 on Friday and Saturday nights combined: "Last year we would make €10,000 easy on one Friday."
That means less cash for Koursaris, who is back in Cyprus for the holidays – he is studying in Russia to become a university athletics coach. His monthly salary is €820; last year it was €1,200.
He says other highly trained Cypriots would refuse to work for so little, "and that's the problem with this country… people don't want to work hard or do menial jobs. They think if they've studied they should be able to walk straight into a good job.
"People are used to having lots of money, and employing people from other countries. They have 'their pride'," he says, mocking the Cypriot accent. "It's not pride, it's stupidity. They are crybabies. They need to get with reality."
The army of migrant labour, meanwhile, is demonstrating its grasp of reality by leaving in droves. George Psaras, head of the Cyprus Chamber of Commerce branch in Larnaca, says "lots and lots" of workers from Bulgaria, Romania, Latvia, Lithuania, Sri Lanka and Africa have already gone home: "And the summer is a relief from unemployment. Already, there are food banks across the country – Cyprus has never had them before."
He says most of the 2,000 people registered for Larnaca's food bank are recent immigrants. He is unable to look up the official emigration statistics because his office on the fourth floor of tower block in the "real town centre" of Larnaca lacks a computer.
Zivile, the Lithuanian receptionist at the Sun Hall Beach Hotel, is moving on. "There is talk about improving conditions and salary, but it is just talk. There are no opportunities here," she says.
Goriana, a 35-year-old Bulgarian assistant at the Traditional Taste tourist shop, says: "It is too difficult for Bulgarian people now. We don't have jobs. If we do, it is for no money. They [Cypriots] don't like us any more. Life is too difficult. I'm hungry, my children are hungry."
It's a similar, if slightly more upbeat, story in Paphos, on the western side of the island. Elianka, a waitress at the all- inclusive upmarket Cypria Marias 300- room resort, where 20-30% of rooms are empty, says: "It's not so good here any more. I want to move to England, or Italy, where I can make more money."
UK tourists say the crisis didn't put them off coming to Cyprus, but many booked their holidays long before the banking crisis this spring.
"It's really beautiful, but it is much quieter than I was expecting," says Gillian Jones, a 60-year-old cook from Neath, south Wales. "You don't have to get up early to reserve a lounger. I guess some people might not have come because of the news. But we'd booked already – maybe it'll hit them next year more."
While Larnaca and Paphos, traditionally favoured by the British bucket and spade brigade, are quieter, the opposite can be said of Limassol, the island's second city, and the party resort of Ayia Napa.
"It's the Russians," says Christos Vasiliou, head of advisory at accountants KPMG Cyprus, who is on holiday with his family in Napa. "Two or three years ago nearly all the tourists were Brits: now you hear Russian in the street."
Most Russians head for Limassol – nicknamed Limassolgrad – where, Vasiliou says, "all the nice houses and villas are owned by Russians".
Russians favour Cyprus because they do not need a visa to travel, it boasted a top income tax rate of 30% until 2011 (now 35% on earnings above €60,000), and because of its formerly relaxed financial services regulation. Big Russian investors in Limassol and other areas lost a lot in the "haircuts" imposed on savings – the money will be converted into shares in Bank of Cyprus, which swallowed Laiki – and were "very angry", Vasiliou says. "But they are still here and more of them are coming, and it's very important for Cyprus that they do."
Official tourism figures show the number of Russians entering the country rose by 20.6% in June to 96,600, nearing the numbers of Brits – down 13% to 111,000 but still the largest contingent.
Russians are so prevalent in Limassol that hotel staff are often refused jobs if they don't speak Russian as well as English and Greek. Marta Vachnadze, a 24-year-old receptionist at the Poseidonia beach hotel in Limassol's not-so-little "Little Russia", says 95% of guests are "Russians, rich Russians".
On the patio enjoying the sweeping views across the Mediterranean, Alessandro, 28, and Khalid, 29, are some of the very few Cypriots lounging among the Russians. "The Cypriots didn't like the Russians, now they love them," says Alessandro. "I'm an accountant, and 99% of the companies I audit are Russians. We need them. Anyone with money – please come."
