Cyprus has drawn up plans to take in up to 200,000 refugees from the fighting in Syria, where the crackdown by government troops against opposition forces has intensified in recent weeks.

While the figures are a worst-case scenario, the number is equivalent to a quarter of the population of the Republic of Cyprus, a huge burden at a time of economic upheaval.

If such a crisis does erupt, officials are hoping the European Union will step in to help.

”We do not know what will happen in Syria, but in our planning we have estimated up to 200,000 refugees could arrive,” Cyprus’s deputy Europe minister, Andreas Mavroyiannis, a former ambassador to the EU and the United Nations, told reporters.

”It will be a very big strain on us if it happens, so we will need help for sure,” he said during briefings in Nicosia.

In 2006, during a month-long war between Israel and Hezbollah in Lebanon, about 90,000 people fled to Cyprus by boat and on evacuation flights. Britain and the United States helped out, as many of those fleeing were foreign nationals.

At the time, Cyprus’s economy was riding high.

But now, three years into a European debt crisis, Cypriot banks have had to write off up to 80 percent of their large holdings of Greek bonds, the economy is in recession, property prices have fallen sharply and at least two banks are in need of immediate recapitalisation.

Russia, a long-time ally of Cyprus, whose communist president was educated in Moscow, has already lent the government 2.5 billion euros to bridge this year’s budget shortfall and may lend more money soon.

Some officials estimate Cyprus needs up to 10 billion euros to safeguard its economy, and it has made a request to the European Union and the International Monetary Fund for a bailout loan, which was being discussed by euro zone finance ministers in Brussels on Monday.

The European Union is reluctant to lend money to Cyprus if it is also taking money from Moscow.

But if the EU imposes overly strict conditions on Cyprus, including inspection of a banking system that is a major conduit for Russian investment flows, then Nicosia may decide that it is better off taking more assistance from Moscow, or perhaps China.

At the same time the EU is especially keen to maintain Cyprus’s stability at a time when it is responsible for running the EU agenda for the next six months as the rotating president. [Reuters]