- Cyprus is trying to reach an agreement with the EU for a 10 billion euro bailout
- A proposal for a one-off levy on bank deposits resulted in a run on ATM machines
- Cyprus' tourist body says its ATMs are working normally and its business as usual
- Nonetheless, visitors are being advised to travel with more cash than normal
Are you in Cyprus? Give us your view on the deal
The financial uncertainty in Cyprus is generating images of long lines at ATM machines and anti-European Union protests.
It's a far cry from the promotional images of azure waters and happy holidaymakers used to attract tourists.
As debt-laden Cyprus labors to meet requirements for a 10 billion euro ($13B) rescue package, a downturn in tourism is probably the last thing it needs.
Greek tourism took a hit during last year's political uncertainty there -- and the U.S. State Department website still carries a warning for U.S. citizens visiting Greece to avoid demonstrations.
In a December report, Cyprus' central bank attributed a 4.1% increase in tourist arrivals in the first 10 months of 2012, in part to "the negative geopolitical conditions in competitor Mediterranean countries."
Protests in Cyprus have so far not resulted in violence, so, in the build up to the vacation season in Europe, how will its tourism sector fare?
Orestis Rossides, the UK director of the Cyprus Tourism Organization, said tourism accounted for roughly 12% of Cyprus' GDP, with Britons making up about 40% of overseas visitors.
Rossides pointed out that Cyprus held the EU presidency in the second part of 2012 and had a "European tourism infrastructure."
He said ATM machines at Larnaca and Paphos international airports -- and all tourist resorts -- were working normally.
"The reports we get from several major Cyprus hotels with a good international reputation is that business is conducted as usual," he said.
Nonetheless British travel association ABTA spokesman Sean Tipton said the crisis and "largely inaccurate reports of ATMs running out of money" would be impacting bookings.
"The reality for holidaymakers is that everything is running normally, though ABTA would advise taking a supply of euros plus credit cards as a safeguard," he said.
"Last year reports concerning Greece leaving the euro also had a short term effect on bookings but these returned strongly over the rest of the year and we would anticipate that bookings to Cyprus will also bounce back quickly."
UK-based tour and travel company Thomas Cook also said it had not received any reports of concern from hoteliers or guests in Cyprus.
"Our team in Cyprus have told us that ATMs are working as normal and shops and restaurants continue to accept payment cards," a spokesman said. "Our recommendation to travelers is to ensure they take a mix of currency and payment cards, including pre-paid currency cards."
The UK Foreign and Commonwealth Office said ATMs, debit and credit cards could be used as normal while Cypriot banks were closed but advised "taking sufficient euros to cover the duration of your stay, alongside appropriate security precautions against theft."
Germany's foreign office also suggested travelers consider increasing the amount of cash they carried with them.
Simon Calder -- travel journalist and senior travel editor at The Independent newspaper -- said taking extra cash was the only additional precaution he'd take.
"The only currency that counts is going to be cash euros," he said. "I clearly wouldn't rely on any sort of plastic. Luckily it's a very crime free place. I would not hesitate to take 500 euros out there in my wallet."
On the up side, Calder said it was likely that Cyprus would offer some great bargains in an effort to attract potentially nervous tourists. "While the British tend to be quite stoic, other nationalities might be more concerned," he said. "There are going to be some great deals particularly when the main season begins in May."
The crisis might help the island balance its economy so that it had "more to do with tourism and less to do with international finance," Calder said. The end result -- particularly if Cyprus went back to its pre-euro Cypriot pound and became more affordable -- could be that the island became a better destination for travelers, he said.
"It's a fantastic destination, with lovely people and fabulous culture. From a tourist perspective it's going to be very uncomfortable for the next few days -- possibly weeks -- but in the long term I can't see anything but people continuing to go there."