The debt-ridden Cypriot economy is faced with tough choices in the coming days. On Tuesday the country’s parliament rejected the tax levy on depositors and now the ECB, with the blessing of the IMF, has issued an ultimatum to the ailing Mediterranean island nation. If Cyprus fails to agree to the terms by Monday, ECB said it will no longer provide the Cypriot banks with liquidity assistance unless the country approves the bailout terms.

Moreover, Russia, Cyprus’s other major creditor, hinted that it will not agree to terms that would grant the country with a new 5 billion euro loan. Reports suggest that Russia is not willing to give the loan considering that the country already lent 2.5 billion euros to the island nation in December 2011. The euro group’s chairman, the man in charge of loan negotiations between Cyprus and other eurozone countries, Jeroen Dijsselbloem, told the press on Thursday that he still believes that the tax levy is the best option for Cyprus.

The growing crisis is visible in Cyprus where locals are terrified by the potential consequences of the ongoing debacle. The shell-shocked Cypriots all over the island are queuing at cash machines to drain their bank accounts ahead of the possible depositor tax.

Cyprus is in trouble, but it’s unlikely that the crisis will spread to the rest of the eurozone considering the country’s small size and relative insignificance in terms the single currency’s general health. However, Cyprus needs to decide how to solve the crisis in order to save its banks and calm its increasingly alarmed public.