Embassy Newsletter       Washington, DC      January 1999


[01] President Wins Global Praise for "Courageous" Missile Decision - Clerides's Action Is Aimed to Boost Settlement Progress
[02] U.N. Reaffirms Framework - For A Cyprus Solution
[03] President Clerides's New year Message Calls for Decisive Action
[04] Conservation Contract
[05] Cyprus & the EU - Welcoming the Euro
[06] Copyright Convention
[07] 1998 Highlights

[01] President Wins Global Praise for "Courageous" Missile Decision - Clerides's Action Is Aimed to Boost Settlement Progress

On Dec. 29, 1998, the government of the Republic of Cyprus announced its decision not to deploy the S-300 air-defense missile system on order from Russia.

In announcing his decision, President Glafcos Clerides stressed that with Cyprus engaged in accession talks with the European Union (EU) and new international initiatives with strong U.S. support to solve the Cyprus problem, the action was a prudent one. He also made it clear that recent actions taken by the U.N. Security Council were major factors. In recent months the U.N. has launched a concerted effort to address the problem based on previous resolutions that have consistently called on Turkey to withdraw its forces which have been illegally occupying the island since 1974.

President Clerides had decided to acquire an air-defense system only in the face of continuous acts of military provocation by Turkey, its thinly disguised aim of dismembering Cyprus and its rejection of numerous proposals to demilitarize Cyprus. He postponed the deployment several times to give the U.N. and the U.S. mediators more time to persuade the Turkish side to engage in serious negotiations and diplomats say the decision to cancel the deployment has placed the pressure on them.

Now that the missiles cannot be used as a pretext for inaction in addressing the core issues of the Cyprus problem, it is expected that the international community, and especially the U.S., will intensify their search for a negotiated Cyprus settlement based on the parameters set by relevant U.N. resolutions. The renewed global interest in Cyprus (expressed in recent U.N. resolutions and statements by President Clinton and other world leaders) were among the considerations for canceling the missile deployment. U.N. envoy Ann Hercus's shuttle talks resumed in Cyprus in January and she met with British Foreign Secretary Robin Cook in London and Secretary General Kofi Annan in New York this month.

In his announcement of Dec. 29 President Clerides said: "I assume the responsibility for this decision and I feel duty bound to underline that my only and exclusive guideline in taking this decision was the best interest of the Cyprus people." The decision he added, "also offers the international community the opportunity to decide to tackle Turkish provocations and intransigence in a substantive way, that would bring results."

The President, who has long advocated demilitarization of the island, made his decision after consultations with all political parties in the National Council and the government of Greece which is bound to defend Cyprus in the event of renewed hostilities under a 1993 defense accord.

The President's initiative to cancel the missile delivery, drew instant, and near-unanimous international praise. And two new U.N. resolutions and other efforts raise hope that a nego- tiated settlement may yet be possible.

The U.S.: The State Department said "we welcome and support President Clerides's decision not to bring the S-300 missiles to Cyprus. We commend the government of Cyprus for taking this important step for easing tensions on the island...this action will give important new impetus to U.N. . . . initiatives to reduce tensions and promote a just and lasting settlement " President Clinton added the statement, will "actively support" implementation of the U.N. resolutions on Cyprus.

U.N.: Secretary General Kofi Annan, welcomed the decision and reiterated his commitment to on-going "shuttle talks" on the island undertaken by his envoy. Annan, a spokesman said, "was very glad to hear President Clerides's decision," which he considers a "tangible positive response to Security Council resolutions 1217 and 1218."

The EU: The European Union presidency said, "This decision has eliminated a source of tension on the island and should encourage progress towards a just and lasting settlement. . .It should be followed by gestures also from the Turkish side . . . The EU is of the view that President Clerides's decision constitutes a positive development also in the perspective of Cyprus's EU accession. It shows that the increasingly strong ties between Cyprus and the EU are able to contribute to the reduction of tensions and to the search for a political solution." Austrian Foreign Minister Wolfgang Schuessel said the EU's strong support for Cyprus's ac- cession was paying off. "We now see that this vote of confidence was justified."

Britain: British Foreign Secretary Robin Cook said both he and Prime Minister Blair "warmly welcome" the decision, which is "a significant contribution to international efforts . . . to reduce tensions in the region. It also helps create the conditions necessary for securing a just and lasting political settlement."

Greece: Prime Minister Costas Simitis said that "the Greek government fully backs this decision." He added that Turkey's goal has been to create tension, while the Greek side's interest was "to insist on legality and use all possibilities for a comprehensive, peaceful solution." The Premier said the new U.N. resolutions and statements by world leaders "may constitute an important development in efforts to reduce tension," and "justifies solid hopes for a new combined effort to consolidate peace and lead to substantial discussions for a solution."

He also pledged that the military cooperation between Greece and Cyprus would continue. "Greece guarantees the right of Greek Cypriots to live in security and will continue to defend that right by all means available," he said, adding that Greece will continue to guarantee the right of Cyprus to bolster its defenses.

Germany: Foreign Ministry spokesman Martin Erdmann called it "an important message for reducing the dangerously high level of arms in Cyprus," adding that Germany would also welcome a contribution by Turkey by reducing its military presence in Cyprus.

France: The Foreign Ministry said Clerides action was "wise and courageous," and constitutes an important contribution to the reduction of regional tension.

Canada: Foreign Minister Lloyd Axworthy said, "President Clerides's decision will contribute to a lessening of tensions in the Eastern Mediterranean." Axworthy also welcomed the inclusion in the U.N. resolutions of proposals to remove landmines in Cyprus.

Russia: A Foreign Ministry spokesman called the matter a purely commercial one. "We do not believe that this [issue] is the origin of tensions on Cyprus . . . Russia has moved forward ideas on how to reduce tensions on the island. The main proposal is the demilitarization of Cyprus, and these ideas are still on the table."

At home, the President's decision was backed by the Democratic Rally Party and the United Democrats of the ruling coalition. The main opposition Progressive Party of the Working People went along with the decision while criticizing the government's overall handling of the missile issue. Against the decision were the opposition Democratic Party and the EDEK Socialist Party. EDEK withdrew its two ministers from the ruling coalition in protest.

While acknowledging the disappointment of some of his critics, the President said the decision "was simply the result of responsible assessment and realistic evaluation of all the existing conditions, factors and prospects, which affect directly or indirectly the course of our national issue."

In concluding his announcement, the President said "we shall continue with prudence and responsibility our efforts to join the EU and to promote a peaceful, viable and lasting solution to the Cyprus problem, which will safeguard the secure and hopeful future of our people and our country. I shall not cease . . . to work hard and expend all my powers in facing the critical hours coming and to serve the true interests of Cyprus."

[02] U.N. Reaffirms Framework - For A Cyprus Solution

On Dec. 22, 1998, the Security Council unanimously approved two key resolutions regarding Cyprus. Both reaffirmed previous U.N. resolutions and reiterated the framework for a just and viable Cyprus solution.

The Cyprus government and the international community supported the resolutions, but Turkish Cypriot leader Rauf Denktash, with the support of Turkey, called them unacceptable on Dec. 23 and he rejected the U.N. call for intercommunal negotiations to end the division of Cyprus.

Resolution 1217 (1998) renewed the mandate of the 1,260-member peace-keeping force (UNFICYP) on the divided island until June 30, 1999, while calling on the leaders of both communities to commit to reductions in defense spending and the eventual demilitarization of Cyprus. It also called for a negotiated settlement "based on a State with a single sovereignty and international personality and single citizenship, with its independence and territorial integrity safeguarded."

With resolution 1218 (1998) the Council endorsed the Secretary General's initiative announced on Sept. 30, 1998, with the goal of reducing tension and promoting progress toward achieving a just and lasting settlement on Cyprus based on the relevant Council resolutions. The Secretary General was also requested to work toward achieving "substantive progress on the core aspects of a comprehensive Cyprus settlement."

Cypriot Foreign Minister Ioannis Kasoulides said the U.N. action which deemed the status quo in Cyprus "unacceptable," raised "some hopeful prospects," and he welcomed the drive "for the reduction of all forces and armaments with an aim to the demilitarization of the island."

Kasoulides pointed out that the resolutions "envisage a bizonal, bicommunal federation . . . with a single sovereignty . . . comprising two politically equal communities as described in previous relevant resolutions." He noted that the Council was for the first time in many years demanding compliance with previous resolutions on Cyprus. "This gives emphasis to what is important for us," he said.

President Clerides made clear that Cyprus expected results. "Cyprus is now waiting for the implementation of the Security Council resolutions and the fulfillment of international commitments undertaken at the highest level," he said.

The U.S., Britain, Germany and the EU reacted with strong support for the Council's action.

In a statement issued shortly after the Council's vote, President Clinton said the U.S. "strongly supports" the U.N. initiative and "wholeheartedly" supports the resolution. He pledged to "take all necessary steps to support a sustained effort to implement UNSCR 1218." Clinton also reiterated that "The United States remains deeply committed to finding a viable solution to the Cyprus problem. A political settlement that would put an end to the tragic division of Cyprus has been, and continues to be, a high priority of my administration."

[03] President Clerides's New year Message Calls for Decisive Action

The President issued a public appeal to the international community to "undertake more decisively and dynamically and fulfill its responsibility by exerting influence on the policy of the Turkish side on Cyprus" toward "a permanent and just peace and stability in Cyprus on the basis, always, of the relevant resolutions of the U.N. international law and justice."

He added his wishes that his countrymen would enjoy a long, healthy happy and prosperous life, but noted that "it is natural that we are thinking of our joys but also our sorrows."

Citing "our enslaved towns and villages, abandoned and looted churches and monasteries, all the destruction caused by the continuing Turkish invasion" the President said "this is a very difficult period we are going through."

He said Cyprus's problems stem from being a small state in an extremely sensitive geostrategic area of the world, with Turkey as a neighbor. He described Turkey as "intransigent and threatening" and underlined that "until today it has not been faced by the international community in the way that international law and the relevant U.N. resolutions dictate."

The President praised Greece for its strong support. "The guide to our thoughts and actions must always be the protection of the interests of the Republic of Cyprus" in close consultation with Greece.

The President pointed out that the goal of accession to the European Union (EU) is nearing reality, a process aided "by the good situation of our economy. One of the two basic targets of our strategy, our accession to the EU, is already beginning to be realized with substantive negotiations being carried out on an official level," he said.

Clerides stressed that international participation was vital to a solution and called for a more "decisive and dynamic stand" on the issue.

The President noted that the government strategy "has been and remains the only one that can persuade, encourage and help the international community exhaust all possibilities of effective involvement in the Cyprus problem."

Stressing that Cyprus follows a policy of peace, he made it abundantly clear that "if provoked or attacked we are ready to give everything to safeguard our freedom and our human and national dignity, however strong the enemy might be."

He concluded his message on an optimistic note saying that the people of Cyprus have suffered much in their long history, but have always managed to survive. "We will survive this time as well, with unwavering determination, with endless patience, with the necessary political prudence and with the indomitable will to safeguard our future in the land of our fathers."

[04] Conservation Contract

On Dec. 18 Cyprus and the EU signed a contract entitled "Special Areas of Conservation" for a project aimed at conservation of the island's biodiversity. The total cost of the project is over $1 million of which the EU will contribute nearly half.

Agriculture and Natural Resources Minister Costas Themistocleous noted that the contract is in line with EU directives and was important for Cyprus "in view of our EU accession course." He pointed out that the principal objective of the project is to provide information on habitats and species of flora and fauna. Existing data will be evaluated, a list of sites to be designated as special areas will be created and a national archive of ecological information will be established.

[05] Cyprus & the EU - Welcoming the Euro

The Cyprus government welcomed the introduction Jan. 1 of the new European Union common currency, the Euro, and described it as a very important move in political and economic terms. Cyprus is in the process of joining the European Union through on-going accession negotiations.

According to the Central Bank, the link of the Cyprus pound (about 2 U.S. dollars) to the Euro is not expected to have any serious repercussions on the local economy.

Europe today, he added, is called upon to meet the demands of globalization as a political and economic power.

"We in Cyprus aspire towards Europe and we are ready to enter the European family. We consider the introduction of the Euro as a very important development in both economic and political terms," Stylianides said.

Central Bank officer, Takis Kanaris, Director of the Department of Economic Research, said that "the link of the Cyprus pound with the Euro is a natural development since our pound was linked to the ECU, its predecessor."

"We do not expect substantive repercussions on the Cypriot economy, our pound is stable," he said, describing the transfer from the ECU to the Euro as "trouble free."

Kanaris explained the flotation margins of the Euro will range from minus 2.25 percent to plus 2.25 percent. He further pointed out that the implied parity of 1.7086 ECU's to the Cyprus pound remains the same for the Euro.

"We now have to see how the Euro trades against the dollar and the yen in the international markets," Kanaris said, noting that in the unlikely event of any increase in the price of the Euro Cyprus would become less competitive.

The Central Bank official said Cyprus must keep an eye on the trading value of the pound sterling in view of the fact that Britain is Cyprus's largest European trading partner. "We believe that sterling will more or less follow the fate of the Euro and sooner or later it will be led down the same path," he said.

He explained that Cypriots travelling to Europe will be able to pay in the currency of their own choice, either in Euro or in other European currency "as there will be no trading profit or loss in such a choice."

Referring to the repercussions on the Cyprus Stock Exchange (CSE), Kanaris said he did not anticipate any effect on that score.

[06] Copyright Convention

The Permanent Representative of Cyprus to the Council of Europe, Mrs. Thalia Petrides, presented the Secretary General of the Council of Europe Mr. Daniel Tarschys Dec. 21 with the ratifying documents of the European Convention relating to Questions on Copyright Law and Neighboring Rights in the Framework of Transfrontier Broadcasting Satellite.

The Convention intends to safeguard the rights and interests of authors (and other contributors) regarding their works (contributions) broadcasted by satellite. The Convention has been ratified by Norway, and has been signed by Belgium, Germany, Luxembourg, San Marino, Spain, Switzerland and the United Kingdom as well as by the European Union.

[07] 1998 Highlights

In February Glafcos Clerides was reelected President for a second five-year term.

March 30 marked the beginning of Cyprus's EU accession process.

On March 31, Cyprus started formal accession negotiations with the EU.

In May, the U.S. announced that DNA tests had identified the remains of Andreas Kassapis who has been missing since the Turkish invasion in 1974. He was abducted by invading Turkish troops while vacationing in Cyprus. Four other missing Americans are still unaccounted for and presumed dead.

In July, the European Court ruled that Turkey must pay refugee Titina Loizidou about $600,000 for depriving her of her ownership rights and access to her property. Ankara has not implemented the Court ruling.

Also in July, the first of two meetings of the Bicommunal Business Group of Greek Cypriot and Turkish Cypriot business-persons was held in Oslo. The second was held in December in Istanbul.

On Nov. 4, the EU Commission adopted a report that noted Cyprus had made significant progress in adopting the acquis communautaire and should face no major obstacles in adopting it.

On Nov. 10, substantive accession negotiations between the EU and Cyprus got underway