Dear Mr. Speaker: (Dear Mr. Chairman:)

In accordance with Public Law 95 - 384 (92 Stat. 739; 22 U.S.C. 2373(c)), I am submitting to you this bimonthly report on progress toward a negotiated settlement of the Cyprus question. This report covers the period from mid-October through December 1990.

During this period the United Nations Secretary General, whose good offices mission forms the core of international efforts to resolve the Cyprus problem, sought to begin implementation of the ``plan of action'' that he had outlined in his report to the U.N. Security Council of July 12. This plan (described in my report to you of August 30) was designed to prepare the ground for restarting the intercommunal talks.

In mid-October the Secretary General asked his Special Representative on Cyprus, Ambassador Oscar Camilion, and Mr. Gustave Feissel of his New York staff, to test the degree of support for the U.N. plan of action in Athens and Ankara, as well as with the two communities in Cyprus. In Athens and Ankara Ambassador Camilion and Mr. Feissel received firm offers of cooperation.

In Nicosia the picture was mixed. Both the Greek Cypriot and Turkish Cypriot communities pledged their cooperation with the Secretary General and reiterated their support for UNSC Resolution 649. Each side also made clear its belief that the other side was intransigent and that progress in carrying out the ``plan of action'' was therefore unlikely.

To lend U.S. support to the Secretary General's efforts, I asked my Special Cyprus Coordinator, Ambassador Nelson Ledsky, to travel to the area in late October. Ambassador Ledsky met twice with the Turkish Foreign Minister, once with the Greek Foreign Minister, and several times each with President Vassiliou and Mr. Denktash. In the course of these meetings, Ambassador Ledsky also discussed a series of possible interim steps that might provide an impetus to the U.N.-sponsored negotiating process. He explained to each party why such a process could not begin with a unilateral gesture by some other party and outlined instead a series of balanced, reciprocal steps that could help create an atmosphere conducive to serious intercommunal negotiation. Although all concerned expressed interest in the development of such a package of steps, no agreement was reached on what the specific steps might be. Ambassador Ledsky's efforts will continue into 1991, in close cooperation with the U.N. Secretariat.

I am pleased to report that on October 28 my nominee for the post of Ambassador to Cyprus, Robert E. Lamb, was confirmed by the United States Senate. Ambassador Lamb presented his credentials to President Vassiliou on November 30. He has met with President Vassiliou and Mr. Denktash to discuss the Cyprus problem and will be active in all its aspects, including the U.S. effort to support the good offices mission of the U.N. Secretary General.

On November 7 the Secretary General sent to the Security Council a report on his mission of good offices in Cyprus (attached), which covered the period since his last report of July 12. In his November report the Secretary General observed that:

``the negative atmosphere to which I had referred in my last report has persisted. Each side has objected to actions and statements by the other. These actions and statements have been a detraction to my effort.''

The Secretary General also reported that the consultations undertaken by Ambassador Camilion and Mr. Feissel in the implementation of his ``plan of action'' had not been completed. He proposed to submit a progress report to the Security Council within 3 months, together with his assessment of the situation at that time. He reminded the parties of their commitment to UNSC Resolution 649, in which the Security Council called for their cooperation ``on an equal footing . . . in completing . . . on an urgent basis an outline of an overall agreement. . . .''

On November 9 the Security Council -- with the United States as President of the Council -- adopted a statement supporting the efforts of the Secretary General. The statement also reaffirmed the Council's ``endorsement of his plan of action to complete an outline of an overall agreement, including the critical substantive issues of territory, refugees, constitutional arrangements and security guarantees.''

On December 7 the United Nations issued the ``Report of the Secretary General on the United Nations Operation in Cyprus'' (attached). In his report the Secretary General pointed out that the U.N. peacekeeping force ``is facing a chronic and everdeepening financial crisis.'' The report also noted a number of incidents during 1990 that indicate that tensions on the island remain high and the presence of the U.N. peacekeeping force is critical to any prospects of a lasting settlement.

On December 14 the Security Council approved for an additional 6 months the renewal of the mandate of the U.N. Peacekeeping Force in Cyprus. On December 21 the Security Council passed unanimously a resolution requiring the Council to examine the problem of costs and financing of the peacekeeping force with a view to implementing an alternative means of financing -- which could include, inter alia, the use of assessed contributions -- on or before June 15, 1991. We will be consulting with appropriate Members of Congress on this issue in the near future.

This is my final report to the Congress on Cyprus for 1990. As I look back over the events of 1990, I am disappointed in the lack of progress in the negotiating process and in the persistence of what the Secretary General has on several occasions called the negative atmosphere prevailing on the island. At the same time, I am gratified at the extraordinary efforts of the United Nations Secretary General and his staff in attempting to find a path toward reconciliation on Cyprus. As 1991 commences, I call upon the leaders of the two Cypriot communities to act in accord with UNSC Resolution 649 and to complete as soon as possible, hopefully by mid-February, the long-overdue outline for a settlement. I can assure the Congress that the United States will do all it can to act as a catalyst in this process and to help the people of Cyprus find the means in 1991 to end the division of their island by creating for themselves a peaceful and enduring bizonal, bicommunal federation.

Sincerely,

George Bush

Note: Identical letters were sent to Thomas S. Foley, Speaker of the House of Representatives, and Claiborne Pell, chairman of the Senate Foreign Relations Committee.