Select Committee on Foreign Affairs Second Report

The way forward

Dealing with the contentious issues

183. In our discussion of those aspects of the Annan Plan which appear to have caused many Greek Cypriots to vote against it, we identified four particular issues: security guarantees and Turkey's continued military presence; refugee return and property rights; Turkish 'settlers'; and the financial and economic costs of implementation. We now return to each of these issues, with a view to proposing ways in which the concerns of Greek Cypriots may be addressed, without raising new concerns among Turkish Cypriots.

184. In seeking to identify ways of moving the process forward, we are encouraged by the views of some of our witnesses that there is good reason to suppose that a modified plan could be acceptable to the people of Cyprus. President Papadopoulos has been categorical in stating that Greek Cypriots rejected, not the whole concept of a settlement, but the particular scheme on which they were asked to vote.[252] Dr Savvides told us "I do not believe that the 76 per cent 'no' is solidified or cemented."[253] These comments were supported by what we heard when we were in Cyprus.

185. The four key areas of contention we have identified in this Report are not the only areas of contention. Both the government of Cyprus[254] and the Lordos study have identified others. In particular, the government of Cyprus stresses what it calls the lack of functionality in the Annan Plan, arguing that the federal structures set out in the Plan would be too cumbersome and unworkable in practice. These objections need to be taken seriously when considering any alterations to the Plan, but they are not prominent among the points raised by ordinary Cypriots and we do not consider them in detail here.

Security guarantees and Turkey's continued military presence

186. A major factor which has caused Turkey to retain its military presence on Cyprus has been the need to provide security for the Turkish Cypriot population and for increasing numbers of Turkish settlers. Protection of Turkish Cypriots from the extremist if short-lived regime of Nicos Sampson was the ostensible reason for the Turkish military intervention of 1974. Between 1963 and 1974, most of the Turkish Cypriot population had progressively withdrawn into enclaves scattered across the island, in order to protect themselves from the violent attentions of a section of the Greek Cypriot population. At several points during that period, Turkey had threatened to send forces to protect Turkish Cypriots and on more than one occasion its air force had overflown the island in a demonstration of its capability. Once it had intervened, Turkey maintained its presence. From the Turkish perspective, there can be no question of abandoning Turkish Cypriots to the treatment too many of them received at the hands of their Greek Cypriot neighbours before 1974.

187. Turkey also has its own strategic interests. A glance at a map of the region demonstrates the proximity of Cyprus to Turkey's Mediterranean coastline. At just forty miles distance, Cyprus is only a few minutes' flying time by fast jet. One of the most anxious periods in the recent history of relations between Turkey and Cyprus came in 1997, when the Greek Cypriot government of President Glafcos Clerides decided to construct a military airbase, with hardened shelters for aircraft which Cyprus did not possess, but which Greece did, and to purchase a ground-to-air missile system capable of striking Turkish aircraft in their own airspace.[255] Clerides eventually backed down, but the incident revealed Turkey's sense of vulnerability on its southern flank and fed deep-seated fears in Ankara that Cyprus would join with Greece in any wider conflict with Turkey. These fears have been a significant factor in the Turkish military establishment's reluctance to withdraw from Cyprus.[256]

188. As we noted above,[257] a majority of Greek Cypriots regard the early departure of Turkish forces from Cyprus as essential. The proposal in Annan 5 for a gradual reduction in those forces to no more than 650 by 2019 was unacceptable to them, mainly because of the slow pace of withdrawal envisaged. No doubt for reasons of national pride as well as for the reasons outlined above, Turkey has been hostile to any suggestion that it withdraw completely. However, if Turkey is serious about joining the EU, she will have to be more reasonable on this point. Turkish Cypriots are, we believe, ambivalent about the Turkish army. Although for understandable reasons they are reluctant to place their views on the record, we heard from several Turkish Cypriot sources when we visited the island that the presence of Turkish troops is not seen as an unalloyed blessing.[258] We believe that many Turkish Cypriots would prefer to see an end to Turkey's military presence, if appropriate security guarantees could be provided.

189. The question therefore appears to reduce to one of how to deal with Greek Cypriots' sense of insecurity, while not creating a renewed sense of insecurity for Turkish Cypriots. It is scarcely credible to suggest that a force of 650 Turkish troops would meaningfully enhance the security of Turkish Cypriots; neither would it pose any serious threat to the security of Greek Cypriots. The presence of such a force would be symbolic, and it is that symbolism as well as the perceptions of insecurity which have to be dealt with. We have therefore considered the possibility that security could be provided for both communities by an international force, which could be drawn from NATO member states, or EUFOR, or the United Nations, but which should not include Greek or Turkish troops.

190. When we put this proposal to Dr MacShane, he said that it was "a very interesting proposition" but his reply appeared to suggest that he had not thought of it as a likely scenario.[259] He was sceptical that "tweaking in terms of troop levels" would be sufficient to persuade Greek Cypriots to support the Annan Plan and told us that "I personally—and it is a personal point of view—cannot get hugely worked up about 650 troops. I just do not see that as a sticking point."[260] We have already demonstrated that this is indeed perceived by a majority of Greek Cypriots as a sticking point. It may be that the Minister was looking at the proposition as being made in isolation, rather than as part of a package of changes to the Annan Plan.

191. Other witnesses were less sceptical. Although the EU has, we were told, yet to consider taking on a security role in Cyprus, Mr Mirel of the European Commission felt that this would be a subject for discussion in the context of the Annan Plan.[261] Dr Savvides supported a NATO or EU force,[262] calling for "some action by the European Union and some guarantees by the Security Council which can mitigate the Greek Cypriot concern"[263] and suggesting that the Turkish political leadership had already accepted that Cyprus does not present a threat to Turkey.[264] On the other hand, Lord Hannay's view was that "Turkey and the Turkish Cypriots, they cannot accept the European Union as the guarantor of a settlement when Turkey is not in the European Union."[265]

192. Turkey's continued status as a guarantor power under the Treaty of 1960, which grants it the right to intervene on the island in certain circumstances (a right which it claims to have exercised in 1974) is another factor which, it is suggested, caused many Greek Cypriots to vote against Annan 5. As the government of the Republic of Cyprus has tirelessly pointed out, the continuation of the guarantor rights was insisted upon by Turkey, not by the Turkish Cypriot negotiating team (although it remains an article of faith for Rauf Denktash).[266] The Cyprus Ministry of Foreign Affairs also told us that "as a last resort and ultimate further concession, the Greek Cypriot side had proposed the adoption of a triggering-off mechanism for the exercise of the alleged right of intervention under the Treaty of Guarantee."[267]

193. We understand why Greek Cypriots, who have already experienced the exercise by Turkey of its claimed rights under the Treaty of Guarantee, are concerned by the Annan Plan's provision for those rights to be perpetuated. In practice, however, we consider that the intervention rights are quite meaningless. The international community has not accepted that Turkey was acting in conformity with its legal rights and powers in 1974, but Turkey acted nonetheless, and Turkey would doubtless have acted as it did, Treaty of Guarantee or no. The best assurances against future action by Turkey would be provided, not by a further treaty, but by a demilitarised Cyprus, a continuing rapprochement with Greece and progress towards EU membership, and the presence on the ground of a properly constituted multinational force, providing real security guarantees with the backing of a United Nations Chapter VII Resolution.

194. The importance of future guarantees being underwritten by the UN was stressed to us by Lord Hannay, who said that

It is still not true that some alternative vehicle called the European Union or NATO or whatever is available; it is not available because it is not acceptable to all the parties. For Turkey and the Turkish Cypriots, they cannot accept the European Union as the guarantor of a settlement when Turkey is not in the European Union, and the European Union quite rightly has a primary responsibility towards Cyprus which is in it.[268]

Lord Hannay was, of course, speaking before Turkey received a green light for EU accession talks.

195. We recommend that in any future negotiations on a settlement based on the Annan Plan, the parties be invited to consider accelerating the withdrawal of Turkish and Greek forces and the demilitarisation of Cypriot forces, so that all these are reduced to zero and security guarantees are provided by an external force acting under the terms of a mandatory resolution of the United Nations Security Council. The force could also assume responsibility for any defensive installations on the island, such as ground-to-air missile systems, as suggested by Friends of Cyprus.[269] Our preference would be for the force to be under EU command, thus avoiding the connotations of a NATO operation, although this is of course for the parties to agree. The arrangements for tasking and monitoring the force would clearly need to provide for Turkey to play a role equivalent to that of Greece, and for the Republic of Cyprus to waive its rights to be involved as an EU member. If a formula of this kind can be devised which is acceptable to both communities on the island, we see no reasonable grounds on which Turkey could object to it. Such a formula might be of considerable assistance in persuading Greek Cypriots to support a settlement in greater numbers than they did in April 2004.

Refugee return and property rights

196. We noted above the very strong feelings of Greek Cypriots on the property issue, and the fears among Turkish Cypriots of 'Hellenisation'. The rights of Greek Cypriot refugees to return to the North of the island and to live in their former homes have to be balanced against the rights of those who now live in those homes, some of whom are themselves Turkish Cypriot refugees from the South. It has always been recognised in discussions on the Cyprus problem that there will have to be an element of exchange and compensation to settle the property issue. Other measures, such as the degree of involvement by a minority community in the affairs of the constituent state within which they reside, and the extent to which such communities are protected directly by the federal authorities, are the subject of complex arrangements in the Annan Plan, which could be subject to further discussion and amendment.

197. Neither can the property issue be considered to be part of a fixed set of circumstances. Conditions on the ground are changing daily. Before we visited Cyprus, Dr Savvides drew our attention to "the whole construction boom which is taking place in northern Cyprus on Greek Cypriot properties."[270] He was concerned that this new construction "destroys the whole balance within the plan over the property issue, which has been very, very sensitive and very, very difficult to handle."[271] We witnessed some of this development when we visited the Kyrenia (Girne) area, although it is apparently most apparent in the area to the north of Famagusta (Maðusa). Land and property are being developed at breakneck pace. The longer this continues, the more complicated the property issue becomes; and the more difficult it will be to resolve.

198. We sympathise greatly with those who were drafting the Annan Plan and who had to grapple with this intractable issue. Further movement my be required if Greek Cypriots are to change their opposition to a settlement, although it should be achieved without displacing more Turkish Cypriots against their will. One possibility might be to provide economic incentives to Turkish Cypriots or settlers to vacate homes owned by Greek Cypriots, by building attractive new homes for them in adjacent communities. This replicates the approach being taken in respect of some areas to be handed over to the Greek Cypriot constituent state, such as Morphou (Guzelyurt). Other aspects which may need to be re-considered include the phasing of arrangements for return and the limits placed on the numbers returning.

199. We note the very strong feelings of the Greek Cypriot people about the need for restitution of property to its rightful owners and conclude that the property issue remains one of the most crucial to be addressed in the search for a solution to the Cyprus problem. We conclude that in any revival of the talks process it will be necessary to find ways of addressing Greek Cypriot concerns which do not disadvantage Turkish Cypriots. An element of outside financial support may be helpful in this regard.

200. One allied but separate question arises in relation to the property issue: the position of British citizens who have purchased properties in northern Cyprus. According to the British Residents' Society of Northern Cyprus, there are about 6,000 British residents in the North.[272] Many of them own properties built on land to which Greek Cypriots have legal title. The British Government advises prospective purchasers of property in northern Cyprus to seek independent, qualified legal advice before doing so, because "The non-recognition of the 'Turkish Republic of Northern Cyprus' and the possibility of a future political settlement in Cyprus could have significant practical or financial implications for those considering buying property in the north."[273] We consider the Government is right to do this. There have recently been some high-profile court cases involving British citizens who have purchased property in northern Cyprus.[274] Now that Cyprus is in the EU, court judgments reached in Nicosia may be enforceable in the United Kingdom and British residents may find themselves increasingly subject to legal action.[275] We conclude that British citizens who intend to buy property in northern Cyprus risk exposing themselves to legal action by Greek Cypriots who may be the rightful owners of those properties. We recommend that the Government lose no opportunity to warn prospective purchasers of this risk.

Turkish 'settlers'

201. Underlying the whole settler question is a dispute about how many Turks live in northern Cyprus, and what proportion they form of the resident population. The issue is complicated by intermarriage between Turkish Cypriots and settlers, by Turkish Cypriot emigration and by the mobility of the population between northern Cyprus and Turkey. In a paper published by the Cyprus Council of the International European Movement and submitted to us by its author, Dr Ahmet Djavit An, a Turkish Cypriot who has written extensively on the Cyprus problem and on the history of modern Cyprus, the population issue is considered in some detail.[276] Most of the following statistical information is extracted from Dr Djavit An's paper:

Turkish Cypriot population
Turkish settler population
1960104,942 (Muslim population) N/A
1974119,147 (independent estimate)

114,960 (Cyprus Government figure)

115,758 (Turkish Cypriot figure)

1977 39,611 (extrapolation from official Turkish Cypriot figure)
1983 47,186 (extrapolation from official Turkish Cypriot figure)
1987115,000 (UK Government estimate)[277] 35,000 (UK Government estimate)[278]
173,224 (Turkish Cypriot unofficial census)
1996137,398 (Turkish Cypriot official census—figure refers to those born in 'TRNC', which includes children of settlers) 54,626 (Turkish Cypriot official census—figure refers to those born in Turkey or citizens of Turkey, not necessarily resident in Cyprus)
200187,600 (Council of Europe estimate) 115,000 (Council of Europe estimate)
187,244 (official Turkish Cypriot figure)[279]

In its submission to our inquiry, the Ministry of Foreign Affairs of the Republic of Cyprus suggested that there are "119,000 illegally implanted Turkish settlers" in the North.[280] Lobby for Cyprus claims there are "130,000 colonists".[281] It is clear that there is no reliable figure in the public domain for the number of persons of Turkish mainland origin who have taken up residence in northern Cyprus since July 1974.

202. Dr Savvides told us that the building boom in the North has been attracting more workers from mainland Turkey, some of whom may wish to remain on the island.[282] This point was also made to those of us who visited Cyprus. We were also told that Turkish Cypriots, disillusioned and disheartened by the lack of progress towards a settlement, are leaving the island in significant numbers. It appears that both the influx into Cyprus of Turkish settlers and emigration from Cyprus by Turkish Cypriots continue. The demographic balance of the North is thus altering further.

203. If a solution such as the Annan Plan, which envisages naturalisation of some Turkish settlers, residence rights for others and the return to Turkey of the rest, is to be implemented fairly and to command confidence, it is important that it is based on information which is accepted by all parties as being accurate and reliable. Such information is not available in respect of the population of northern Cyprus. Recognising this, the Council of Europe's Parliamentary Assembly has twice (in 1992 and 2003) adopted recommendations for a census to be held of the population in northern Cyprus, in order to determine its composition.[283] Others, such as Friends of Cyprus, have supported this call.[284]

204. Mr Mirel, representing the European Commission, told us that "Certainly we would be willing to support the imposition of such a census" and suggested that part of the EU's aid to northern Cyprus could be used to fund it.[285] Dr MacShane, for the Government, also said that he "certainly would favour the Turkish Cypriot authorities being able to announce clearly the number of people and where they came [from] and where they were born and to put that in the public domain."[286] In a supplementary paper, the FCO suggested that "It would be for the two communities on the island, in conjunction with the United Nations, to discuss the contribution that a census could make to the achievement of an overall solution."[287]

205. We recommend that a population census be held in northern Cyprus, funded by the European Union and carried out either by an appropriate international body or by the Turkish Cypriot authorities under close international supervision.

206. Accurate figures should be of some assistance in establishing exactly how many people and families will be affected by the terms of a solution based on the Annan Plan, but they will not of themselves deal with Greek Cypriot objections to the provisions of the Plan which, under any of the many different interpretations which exist, would allow more than half of the settlers to remain in Cyprus. We noted above that most Greek Cypriots regard it as essential that the numbers of Turks to be obliged to return to Turkey under the terms of the Plan should be increased. We are also aware of suggestions, which were substantiated when we visited Cyprus, that Turkish Cypriots feel that their distinctive identity may be under threat, now that they form a minority of Turkish-speaking residents of Cyprus.

207. We therefore feel guardedly optimistic that there may be scope for some limited adjustment of the provisions of the Annan Plan in relation to the settler issue. We suggest that such an adjustment could most realistically focus on providing strong economic incentives for settlers to return to Turkey, combined with stricter limitations on the granting of citizenship or the right of residence. These measures can be portrayed as a mirror image of those which apply to Greek Cypriots seeking to reclaim their properties in the North: quantitative limits, offset by financial compensation. They would introduce a greater symmetry to the Plan and they would satisfy the criterion we set ourselves earlier in this Report, of seeking changes to the Plan which would meet the demands of Greek Cypriots, while not damaging the interests of Turkish Cypriots.[288]

208. We recommend that in any resumption of negotiations for a settlement of the Cyprus problem, the Government seek to persuade the parties of the need for an increase in the number of Turkish settlers who will be required to return to Turkey as part of a solution, together with improved financial compensation for them. The precise figures should be for negotiation between the parties.

Financial and economic costs of implementation

209. Although Turkish Cypriots receive aid from the United States, the United Kingdom and the EU, among others, the self-styled 'Turkish Republic of Northern Cyprus' has effectively been bankrolled by Turkey, which has supported the northern Cyprus economy to the tune of $3.7 billion over the past 30 years. In 2005 alone, this aid is expected to amount to over $350 million.[289] This significant financial commitment and burden will presumably continue if there is no settlement of the Cyprus problem, so it is not unreasonable to expect Turkey to maintain some kind of financial assistance to the island in the event that there is a settlement.

210. We noted above that many Greek Cypriots believe as a matter of principle that compensation for unrecovered property should be paid by Turkey, whose forces expelled them from those properties some 30 years ago.[290] The very fact that Greek Cypriots are prepared to contemplate an element of compensation rather than full restitution is itself a huge compromise for them.

211. We conclude that a substantive financial gesture by Turkey on the property compensation issue would be a magnanimous and positive move which would reflect well on Turkey and should be of some assistance in reducing Greek Cypriot opposition to a solution which stops short of full restitution.

212. The United Kingdom's financial aid to northern Cyprus has already been referred to.[291] The amounts provided through FCO programmes are modest, but in relation to the size of the population they are not insignificant; we also believe the aid has been well-targeted. Since a solution to the Cyprus problem should offer important advantages to the United Kingdom, opening up new economic, trading and investment opportunities, we would expect the Government to be prepared to invest in Cyprus's future. In particular, educational and training initiatives involving young people from both communities could offer significant medium- and long-term advantages for both Cyprus and the United Kingdom.

213. It is the European Union, however, which is best placed to throw its financial weight behind a solution to the Cyprus problem. As well as the €259 million of aid already committed to the North, there is the prospect of major investment from the structural funds, once the acquis applies across the island. Greek Cypriots as well as Turkish Cypriots can benefit from investment in ports, reservoirs, public utilities and economic infrastructure projects. Lord Hannay told us that EU funding could be used to "help the South bear the economic costs" of a settlement without damaging the interests of Turkish Cypriots.[292] Our recent discussions with senior figures in the EU have confirmed this impression.

214. Speaking in October 2003, US Ambassador to Cyprus Michael Klosson said that

The costs of a settlement—although real—can be managed, and international aid will help smooth the inevitable disruptions of change. As recently as the end of May during his visit to the island, the Administrator of our Agency for International Development reiterated the U.S. commitment. Let me repeat it: the United States will participate in and contribute financially to the donors' conference the EU will organize. Keep in mind as well the expected economic benefits that will accrue following the adoption of the Annan plan.[293]

We welcome this commitment, and look forward to the time when it can be turned into practical assistance to Cyprus.

215. The concern felt by many Greek Cypriots about the ongoing running costs of the proposed United Cyprus Republic, as distinct from what might be called the 'set-up' costs and the costs relating to the two constituent states, is more difficult to deal with. The Republic of Cyprus is not a poor country, even in EU terms. The standard of living in the South of the island is higher than that in Portugal.[294] It is significantly higher than that in the North.[295] Nevertheless, the experience of Germany since reunification demonstrates that even the strongest economies can come under severe strain when they have to adjust to a new state of affairs, and concerns and resentments similar to those expressed by Greek Cypriots have arisen in western Germany, leading to strains and tension between Germans. It will be important, therefore, that the international community not only assists the people of northern Cyprus to raise their standard of living and improve the health of their economy, but that it eases the burden on the people of southern Cyprus. There may also be ways of reducing the cost of implementation, as suggested by Friends of Cyprus.[296]

216. We conclude that the costs of a settlement in Cyprus may be considerable, but that the international community is able and willing to make a substantial contribution to them. We recommend that the Government seek to ensure that, before any further referendum is held on the island, clear information is available to the people of Cyprus on the extent of the financial contribution which will be made by countries other than Cyprus. We further recommend that the Government and the European Union look sympathetically at ways of alleviating the financial burdens of a settlement on ordinary Cypriots.

Prospects for success

The case for and against a step-by-step solution

217. As we noted above, for a period in the early 1990s the approach to the Cyprus problem was essentially one of seeking to make progress by a series of confidence-building measures. Such measures would have included the opening of Nicosia international airport (which is situated in the buffer zone) to air traffic for both sides of the island, and the return of Varosha to Greek Cypriot administration.[297] None of these initiatives was adopted, although other measures such as the provision across the Green Line of water and electricity have been successfully implemented throughout the period since the Turkish intervention, particularly in Nicosia.

218. Following the failure of the Annan Plan, there has been renewed interest in confidence-building measures as a way of making incremental progress towards an overall solution, particularly on the Greek Cypriot side. For example, President Papadopoulos has proposed a series of measures, including designating the port of Famagusta (Maðusa), which is situated in the Turkish Cypriot sector, as a legal port of entry for Cyprus, and making much-needed investment in it, in exchange for the return of the adjacent town of Varosha.[298] Meanwhile, small-scale but important initiatives have proceeded, including de-mining of areas mined during and after the 1974 conflict and efforts to locate and open mass graves of those who fell in that conflict, although it has to be said that these have been neither as swift nor as successful as had been hoped for.[299]

219. The UN and most governments appear to favour an all-or-nothing approach, but the difficulty with this is obvious: in the absence of all, there is nothing. Others are more supportive of a step-by-step approach, and suggest that it could be part of an overall solution. Brendan O'Malley, a journalist and author who has written extensively on the Cyprus problem, suggested that "there is an important place for a supplementary channel by which Cypriots can break the logjam" and proposed two cross-community initiatives: educational and awareness schemes to break down mistrust and increase understanding among young people; and a "grass-roots constitutional convention … to find an island-wide consensus on how the functionality of the Annan Proposals can be improved."[300]

220. It would also be possible for any of the parties to the problem to take unilateral steps which would increase confidence or assist the climate for a solution. For example, the Minister for Europe suggested that "the sight of a division or so of Turkish troops getting on to their transports and leaving the island would send a marvellous symbolic signal around the world that Turkey was thinking afresh while still maintaining security for the Turkish Cypriots and security concerns in the region."[301] We strongly agree with this, and are disappointed that recent Turkish statements appear to have completely discounted it as a possibility.[302]

221. When we asked Dr MacShane whether he felt there were any other issues which could be dealt with outside the context of a full resumption of negotiations he said "I do not want to cherry pick. I really think that is not helpful."[303] We recognise the great danger of the cherry-picking approach, that once one side has as many cherries as it feels it needs, it loses any incentive to make further progress. However, as each step builds trust and confidence, so the psychology changes. It is perhaps the very lack of confidence between the two sides in Cyprus which has made agreement on an overall settlement so difficult.

222. In other Reports, we have considered the situation in the Middle East, and in particular the unilateral decision by the Israelis to withdraw from Gaza.[304] In that context, we have regarded the Gaza withdrawal as a positive development, provided that it is consistent with the Road Map and with the wider peace process. We consider that similar considerations apply to confidence-building measures in Cyprus.

223. We conclude that, in the absence of an overall solution to the Cyprus problem, a step-by-step approach is likely to be better than no progress at all. We also conclude that confidence-building measures have a role to play, but only if they are consistent with the principles which underlie the Annan Plan, and only if they do not diminish the prospects of an overall settlement. We recommend that the Government consider lending its support to any worthwhile and practicable confidence-building measures which meet those criteria.

Annan Six?

224. Seasoned observers of the Cyprus problem know better than to expect an early resolution. Talking to us in October, Dr Savvides said that "it will be difficult now to undertake another effort … in the next few months or a year."[305] He suggested that it may take until after elections in the South of the island in 2006 before any new initiative can be launched.[306] On the other hand, Dr Brewin called for the EU to take an early initiative, concluding that

The chances of there being an upset in Turkey on any number of issues ranging from Iraq, to Kurds, to Muslims, to a split within the governing party, are so great that if we do not pay attention to the regional context and try and get a solution to the Cyprus thing, not just for the European Union's internal reasons but for the sake of peace in the area, then I think we are going to be regretting the time we lost waiting for elections.[307]

225. Lord Hannay saw limited room for manoeuvre on the terms of the Annan Plan, but thought it could "probably" be revived,[308] provided both sides were prepared to compromise.[309] He reaffirmed that "the United Nations is going to have to be the vehicle for any settlement",[310] a view supported by Dr MacShane.[311] However, Greek Cypriot political leaders have recently supported a greater role for the EU in any revived talks process, and a correspondingly lesser role for the UN. This is unsurprising, given Cyprus's new status as a full EU member and the strong language used in President Papadopoulos' letter to Mr Annan,[312] but it is unlikely to be acceptable to the Turkish Cypriots or to Turkey.

226. Speaking in Brussels on 17 December, Mr Annan said "For the moment I have no plans to resume the talks and, as I said, my good offices are available and I am waiting for the parties to reflect on what has happened and determine where they want to go."[313] It remains to be seen what the parties will decide, but the outcome of the European Council on 17 December has effectively set a timetable of opportunities.

227. Elections to the Turkish Cypriot representative assembly in February will be followed by a leadership election in April. After these elections, a period of at least three months will be available, during which negotiations on a settlement based on the Annan Plan could take place, if the parties are willing. Under the ideal scenario, such negotiations would lead to agreement and referendums could be held in both communities in time for the settlement to be implemented by the beginning of October. Turkey would then be able to recognise the United Cyprus Republic and (if other criteria had been met) its accession talks with the EU could proceed on schedule and in a more favourable context. Former Cyprus diplomat Michael Attalides has pointed out that, whereas last April Greek Cypriots faced the danger that they might be voting for a solution which, in the event of a rebuff from the EU, Turkey would see no incentive to implement, Turkey has since 17 December had every incentive to abide by its commitments.[314]

228. Turkey also has a strong incentive to seek an early resolution of the Cyprus issue. It has undertaken to extend its Customs Union agreement with the EU to all ten of the 2004 accession countries—including Cyprus—by 3 October 2005. By doing this, Turkey will be entering into a legally binding international agreement with a state which it does not, at present, recognise. As things stand, Turkey will either have to recognise the Republic of Cyprus formally, or accept that the customs union will be interpreted in some quarters as being tantamount to recognition. All this is aside from the question of whether the Republic of Cyprus will choose to make use of one of the 64 opportunities it has identified to veto Turkey's accession if recognition is not formal and explicit.[315] If, however, Turkey were able to recognise a United Cyprus Republic and establish full diplomatic, trading and other links, its situation would be transformed. For Turkey, an early settlement of the Cyprus problem must now be a priority.

229. Turkish Cypriots, too, have strong incentives to conclude a settlement with the minimum of delay. All those Turkish Cypriots who wish to be a fully integrated part of the EU and to see their economy develop and prosper will need to be ready to countenance negotiated changes in the Annan Plan, as discussed above.[316] There is also a real danger that areas currently administered by the Turkish Cypriots but which under the Annan Plan would be handed over to the Greek Cypriots, such as the town of Morphou (Guzelyurt), will be starved of investment. An early resolution of the status of these areas would remove this blight. And for pro-solution Turkish Cypriot politicians, time may be running out. The result of the elections in northern Cyprus will show the extent to which Turkish Cypriots have either lost patience or are still prepared to support a solution based on the Annan Plan.

230. Greece supports Turkey's application to the EU and supported the Annan Plan. Although Greece has adopted a low-profile role in relation to the Cyprus problem, it can be assumed that she will continue to work for a settlement behind the scenes. We are heartened by the continuing rapprochement between Greece and Turkey. We believe, however, that it would be helpful if Greece were to be more openly in favour of and to throw its weight behind a settlement, in the event that a further agreement can be reached.

231. The EU and the UN will certainly be willing to support a process which has a realistic prospect of success. For the UN, the test for the resumption of the Secretary-General's mission of good offices was set out by Kofi Annan in his Report to the Security Council last May: the Turkish Cypriots must be ready to consider changes to the Annan Plan; the Greek Cypriots must state what changes they require; and the process must hold out a realistic prospect of success.[317] We are confident that the new generation of Turkish Cypriot political leaders is willing to discuss changes to the Plan, so long as they do not radically alter its balance. The key to further progress, therefore, will be the attitude of the Greek Cypriots and of their political leadership.

232. It is the Greek Cypriots who have least incentive to conclude an early settlement. They are in the EU; their economy is prospering, with every expectation that they will be able to join the Euro; and their situation is stable. For Greek Cypriots, there is much about the status quo which is positive. Yet a settlement of the Cyprus problem offers them much more: the opportunity to develop the full economic potential of the island; a trading relationship with their near-neighbour, Turkey; recovery of land and of property; and above all, the prospect of eventual reconciliation with their Turkish Cypriot counterparts and the removal from their lives of the blight of inter-communal strife. The alternative may be a perpetuation of the status quo, leading to permanent division of the island. Nonetheless, there is no evidence of urgency on the part of the government of the Republic of Cyprus and it is the Greek Cypriots who will, doubtless, prove hardest to persuade of the need for urgency.

233. There is, however, a further factor. On 1 July 2005, the United Kingdom will assume the Presidency of the European Union. The Government will then be responsible for making progress on the EU's agenda and will be able, within limits, to set its priorities. During its Presidency, the United Kingdom will have to implement the European Council's decision of 17 December on Turkey's accession process. The Government will thus play a leading role in preparing for and then implementing that process. It will be uniquely well-placed to assist the process for a settlement of the Cyprus problem, as a guarantor power and by ensuring that the search for a settlement is one of the priorities of the Presidency, so that the EU is fully committed to the process.

234. We suggest that the process leading to an early settlement could look something like this:

  • between now and April, the United Kingdom and the international community would impress upon Turkish Cypriots the importance of their continued support for a settlement consistent with the terms of the Annan Plan, which they have previously accepted in a popular vote;
  • in the same period, the United Kingdom and the international community would impress upon Greek Cypriots that their interests are best served by a negotiated settlement such as the Annan Plan, and that they need to articulate their concerns with precision, clarity and finality, in order that negotiations can take place this Summer;
  • the UN would ensure that, following the leadership elections in the North, it is in a position to take stock of the situation and determine whether there are grounds for restarting the Secretary-General's mission of good offices;
  • if there were grounds for reopening the mission of good offices, the parties would without delay begin negotiations, under UN auspices if they so choose, with a view to meeting as many as possible of the concerns felt by Greek Cypriots, without detracting from the attractions of the scheme for Turkish Cypriots;
  • if negotiations resumed, the United Kingdom Government would ensure that their successful conclusion was made a priority of its Presidency of the EU;
  • the negotiations would be completed as soon as possible, so that a settlement plan agreed by the political leadership of both communities and by the international community could be published well in advance of referendums;
  • as part of their acceptance of a settlement plan, the political leaderships of both communities would undertake to campaign in their respective communities for a 'Yes' vote;
  • the referendums would take place in time for the result to be announced and (in the event that a favourable result was achieved) the plan to take effect before 3 October 2005.

235. We are of course aware that the above scenario assumes success at several points in the process where failure must be considered the more likely outcome. We consider, nonetheless, that the political leaders of both communities on Cyprus, and the international community, owe the people of Cyprus their best effort at achieving the settlement which is in all their interests.

236. We conclude that a lasting settlement of the Cyprus problem is overwhelmingly in the interests of the people of Cyprus and that it offers important advantages for the European Union, for Turkey and for the international community. We further conclude that, although the prospects for success may not be great, the opportunities which will arise in mid-2005 must be seized. As one of the Permanent Five on the UN Security Council, as President of the EU in the second half of 2005 and as a guarantor power in relation to Cyprus, the United Kingdom is in a uniquely special position to assist the process. We recommend that the Government make the achievement of a solution to the Cyprus problem a priority of its foreign policy in 2005.

252   Ev 73 [Cyprus High Commission] Back

253   Q 4 Back

254   Ev 115-9 Back

255   Cyprus: The search for a solution, David Hannay, I B Tauris, December 2004, p 70 Back

256   Ev 102 [Brigadier Henn] Back

257   See paras 39 to 45 Back

258   See also Ev 246 [Andrew Dismore MP] Back

259   Q 220 Back

260   Q 149 Back

261   Q 278 Back

262   Q 32 Back

263   Q 27 Back

264   Q 29 Back

265   Q 65 Back

266   Ev 75, 114 Back

267   Ev 115 Back

268   Q 65 Back

269   Ev 200 Back

270   Q 36 Back

271   Ibid Back

272   Ev 241 Back

273   HC Deb, 14 October 2004, col 365W and (advice current as at 12 January 2005) Back

274   See, eg, Bad news for British expats in the north, Cyprus Mail, 16 January 2005. Back

275   Ev 246 [Andrew Dismore MP] Back

276   Ev 172-7 Back

277   Third Report of the Foreign Affairs Committee, Session 1986-87, Cyprus, HC 23, para 49 Back

278   Ibid. Back

279   According to press reports, December 2004 Back

280   Ev 74 Back

281   Ev 276 Back

282   Q 36 Back

283   Ev 133 [Claire Palley] Back

284   Ev 195 Back

285   Q 270 Back

286   Q 205 Back

287   Ev 59 Back

288   See para 38 above Back

289   See Back

290   See para 52 Back

291   See para 170  Back

292   Q 50 Back

293   Speech available at Back

294   CIA World Factbook Back

295   Ibid Back

296   Ev 198 Back

297   Report of the Secretary-General on his mission of good offices in Cyprus, 4 April 1994, UN Doc S/1994/380. Back

298   Ev 89 [Cyprus High Commission]. The port would be operated jointly by Greek and Turkish Cypriots, under EU auspices. Back

299   See, for example, Digging in the wrong place?, Cyprus Mail, 12 January 2005.  Back

300   Ev 203 Back

301   Q 173 Back

302   See our recommendation at para 163 above. Back

303   Q 179 Back

304   Seventh Report from the Foreign Affairs Committee, Session 2003-04, Foreign Policy Aspects of the War against Terrorism, HC 441, paras 348-358. Back

305   Q 23 Back

306   Ibid Back

307   Q 25 Back

308   Q 56 Back

309   Q 62 Back

310   Q 65 Back

311   Qq163, 214 Back

312   See para 82 above Back

313   See Back

314   Cyprus Review, vol 16 No 1, Spring 2004 Back

315   'How Cyprus's wounds are hurting Europe', Financial Times, 23 December 2004 Back

316   See paras 183 to 216. Turkish Cypriots who are citizens of the Republic of Cyprus are already citizens of the EU. Back

317   Report of the Secretary-General on his mission of good offices in Cyprus, UNSC document S/2004/437, para 91; see also Q 214 [MacShane] Back

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