For the Greek Cypriots, it would end lingering insecurity, give them access to the Turkish economy, the most dynamic in the region, and increase their service industry’s value as an eastern Mediterranean hub. For Turkish Cypriots, it will mean being able to enjoy the benefits of EU citizenship of which they are presently largely deprived. For the EU, the unresolved Cyprus problem now hampers its functioning on issues as diverse as cooperation with NATO in Afghanistan and Chinese shoe imports. And for Turkey a settlement would overcome a major obstacle to its convergence with the EU.

If such an effort fails, the alternative is likely to be partition. Movement toward this has accelerated since 2004, when the UN’s Annan Plan, in an ironic reversal of long-held positions, was accepted by the Turkish Cypriots but collapsed due to Greek Cypriot rejection, and the Greek Cypriot government entered the EU as the sole representative of the divided island. While there has been almost no bloodshed since the Turkish invasion of 1974 and violent conflict remains highly unlikely, the events of 2004 have rendered obsolete the comfortable belief that the relatively tranquil status quo can be preserved indefinitely.

If no settlement is found, the process referred to locally as “Taiwanisation” will inevitably speed up, consolidating partition. All sides need to focus much more sharply than they have to date on the downsides of this. Greek Cypriots will experience growing international toleration of the self-declared Turkish Republic of Northern Cyprus, loss of significant land that would have been returned by the north in any settlement, permanent stationing of Turkish troops, acceleration of a Turkish Cypriot building boom on Greek-owned properties, and the arrival on the island of more Turkish settlers. Turkish Cypriots will experience slower development; a tougher struggle against criminal elements taking advantage of their isolation; and indefinite suspension of many of their rights as EU citizens. Turkey will face a troubled atmosphere in a wide range of its dealings with the EU and in NATO, making it much harder for its leaders to pursue additional economic, legal and administrative reforms.

Any comprehensive reunification settlement will need to be based on the bizonal and bicommunal principles that have been long understood by the parties and are at the heart of past UN mediation efforts. Both sides can live with at least two thirds of the 9,500-page UN Annan plan, and solutions can readily be envisaged to the outstanding matters in dispute if only, as ever, the political will can be summoned to engage in serious negotiations. That will require a fresh start: since March 2006, when Crisis Group first reported on Cyprus, it has become apparent that the initially promising process based on the 8 July 2006 Agreement between the leaders of the island’s two communities is wholly stalemated.

The period following the Greek Cypriots’ February 2008 presidential election may offer both communities an opportunity to reestablish their will to engage in meaningful negotiations. While there is understandable scepticism now in many quarters as to whether any likely outcome of that election will be conducive to such negotiations, it is important that this issue not be pre-judged. In the weeks ahead maximum efforts should be made, internally and externally, to focus on the substantive matters at stake  – the disadvantages of an accelerated move to partition and the advantages of a comprehensive reunification settlement – and the process by which negotiations might be advanced. This report is written in that spirit.

The ideal outcome would be for the leaders of both sides, as soon as possible after the election, to meet and signal to the UN a real commitment to restart talks, backing this up with unilateral confidence-building measures (CBMs). The UN should then send a mission to establish a framework for subsequent face-to-face talks between the leaders. At that point Turkey should unilaterally open its seaports and airports to Greek Cypriot traffic, followed quickly by action from the Greek Cypriots to remove the obstacles they have created to EU direct trade with the Turkish Cypriots. Difficult as they no doubt will be to achieve, such measures, taken together, would create an atmosphere in which negotiations would have a realistic chance of succeeding.

RECOMMENDATIONS

To relaunch negotiations after the February 2008 Greek Cypriot presidential elections

1.  Greek and Turkish Cypriot leaders should jointly express their will to re-engage in UN-mediated talks on a comprehensive settlement, and the UN should build up its team in Cyprus and send a senior figure to conduct an assessment mission.

To establish an environment conducive to successful negotiations

2.  The Greek Cypriot administration, as a unilateral CBM, should agree to EU implementation of its Direct Trade Regulation so as to allow Turkish Cypriot products to be sold directly to the EU.

3.  The Turkish Cypriot administration, as a unilateral CBM, should freeze construction on Greek Cypriot-owned real estate.

4.  Turkey, as a unilateral CBM, should implement its commitment in the 2005 Additional Protocol to the EU-Turkey Customs Union to open its seaports and airports for Greek Cypriot traffic, and its civilian and military leaders should firmly commit to the reunification of Cyprus in a bicommunal, bizonal federation and ultimate  full withdrawal of Turkish troops pursuant to a settlement.

To maintain momentum in the negotiations

5.  Both Cypriot administrations should lift impediments that prevent the EU from working freely in Turkish Cypriot-administered areas; the Greek Cypriots should pro-actively discourage discrimination against Turkish Cypriot products and advertising in Greek Cypriot media and commerce and engage pragmatically with Turkish Cypriot police, public health authorities, and other agencies dealing with day-to-day affairs.

6.  The Turkish Cypriot administration should end harassment of merchants seeking to export through Greek Cypriot ports and allow EU-financed bicommunal projects to proceed, especially to encourage joint ventures based on common interests with the Greek Cypriot private sector and a renewal of civil society meetings.

7.  The UN and EU should develop and deepen collaboration on intercommunal meetings, in particular to increase opportunity for debate on the economic, social and political benefits of reunification.

8.  Turkey should:

(a)  explore all ways to allay Greek Cypriot fears, including avoiding military exercises near the Green Line and military overflights of internationally recognised Greek or Greek Cypriot airspace;

(b)  offer as soon as there is significant negotiating progress to accept international monitoring of its troop strength on the island; and

(c)  encourage Turkish officials, business people and intellectuals to engage with Greek Cypriots to build trust in support of the negotiations.

9.  Greece should explain the potential dangers of non-resolution of the Cyprus problem to all European member states in preparation for comprehensive talks in 2008 and encourage Greek Cypriots to emulate its own détente with Ankara since 1999.

10.  EU institutions and member states should strongly support renewal of Cyprus talks in 2008, follow them closely so as to be ready to react to a threatened breakdown, explain to publics and policy elites in Europe how the Cyprus problem injures the common foreign and security policy, and encourage Russia to use its influence on the island to encourage a settlement.

11.  The U.S. should work with European capitals and with other Security Council members to highlight the dangers of non-resolution of the Cyprus problem.