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Cyprus towards creeping divergence, leads to conflictual divorce, report urges

A report published this month by the European Studies Center of the St. Anthony's College, at University of Oxford (SEESOX), revealed that the status quo in Cyprus is leading to “creeping divergence” and analyzed the possible scenarios of “the divorce” of the Turkish and Greek Cypriots.

The report titled “Cyprus after its EU accession; Getting past the no vote” is the outcome of a workshop organized in Oxford, entitled “Cyprus after accession: Thinking outside the box,” which took place at St. Anthony's College, Oxford on March 9-11, 2006.

The workshop was convened by Othon Anastasakis, Olga Demetriou, Kalypso Nicolaidis, Kerem Öktem and Max Watson, and brought together leading experts on the Cyprus question. Here are excerpts from the report:

Diagnosis of the present

Discussions focused initially on developments since April 2004. Participants voiced differing degrees of dissatisfaction with events. Discomfort from the Greek-Cypriot side was related to the failure of the outside world to understand their misgivings regarding the Annan plan and its failure to take into consideration Greek-Cypriot anxieties: property issues, mobility constraints, inflow of migrants from Turkey, the continued presence of Turkish troops and the status of settlers.

The exploitation and trade of Greek-Cypriot property in the north has been a central source of Greek-Cypriot discomfort since 2004.

The Turkish Cypriot side also voiced strong discontent with events of the past two years and a growing sense of disillusionment and frustration with both the international community, the Greek-Cypriots, and to a lesser extent Turkey.

Living standards in the north have risen considerably since 2004, even if this rise was mostly confined to Turkish Cypriots and did not reach the Turkish settlers whose wealth levels remain significantly lower. Recent growth levels reflect in part an unsustainable boom driven by property transactions and consumer spending, as well as by a growing dependency on the thriving yet volatile economy of Turkey.



Absence of economic ties creates obstacle

Most participants pointed to the absence of significant economic ties between the two communities - other than commuting and a unidirectional trickle of Green Line trade - as the single biggest obstacle to the sustainability of current growth rates in the north. Could the Turkish Cypriot north be entering an ever closer economic union with Turkey? And was there not a sense of unreality when EU economic evaluations of the Republic of Cyprus - however flattering - referred to a Cyprus with the north bracketed off?

If the boom in the Turkish Cypriot north is in part dependent on construction, the recent UK court decision in the Orams Case in favor of the British couple has strengthened the legal basis for the purchase of property in the north, and has further stabilized foreign interest in local properties with property prices expected to raise by about 20 percent as result. In addition to the political fallout, the question is how sustainable this boom is in ecological terms, if the cultural, natural, and historical heritage were damaged by construction without stringent criteria for development?



Tensions and risks of the status quo

For some participants, the current situation can be seen as yet another pause in a long series of unsuccessful negotiations. For some it is already de facto separation. For others, we are witnessing a slow process of “creeping divergence” in the political and economic arenas, the final outcome of which remains unclear. How sustainable is this “creeping divergence” and what concerns does it raise?

• A deepening of economic and monetary bonds between the Turkish Cypriots and Turkey might entrench vested interests against reunification of the island on any terms. Such pull-factors, however, are counter-balanced by a growing sense of a distinct Turkish Cypriot identity among the Turkish Cypriots. These new identity politics insist on a distance both to Turkey and to Greek-Cypriots.

• Turkey-EU relations remain volatile. A probable crisis in the relations between Turkey and the EU, most likely to be triggered by the unresolved status of Cyprus, might disrupt the entire fabric of EU policy towards Cyprus. The Greek side should not feel shielded from negative spillover by its membership status, as the EU cannot prevent further irreversible developments in the field of property or in terms of Turkish Cypriot citizenship in the south.

• Developments on some issues such as property might disrupt the status quo and develop beyond the control of the local elites. It was felt that property in many ways epitomized the conflict and is the lynchpin issue between individual rights and politics. The issue is being tackled incrementally through lawsuits - which might or might not favor the actual restoration of these rights.

• Do rights currently offered to Turkish Cypriots in the Republic of Cyprus (in particular identification documents and access to health services) go far enough in making Turkish Cypriots feel that this is really their state too? For instance, many Turkish Cypriots have called for additional rights in the south, such as voting rights.

However, extending these rights too far runs the risk of creating resentment among Greek-Cypriots who argue that the Turkish Cypriots want to have their own state and still gain the benefits from, and participate in, the Republic of Cyprus, a state they claim not to recognize.

Here is the paradox. Many participants felt that the current situation is unsustainable yet it is hard to see viable alternative scenarios for the future short of bold political initiatives. This is in part because expectations about likely spillovers and scenarios are contradictory and do not point to clear critical junctures or points of no return.

The current situation of creeping divergence might lead to a number of desirable or not so desirable scenarios. Four were identified and discussed during the workshop.



Four scenarios: Taiwan or Yugoslavia?

1) Structural stalemate à la Taiwan: The TRNC remains unrecognized while it continues to perform many of the functions of a sovereign state. In the long run, some developing countries and members of the Organization of Islamic Countries might recognize the TRNC, even if annexation by Turkey cannot be ruled out. Yet this status quo at the political level must be assessed against the backdrop of the creeping divergence discussed above and therefore potential grievances on the part of both sides. Such grievances may be getting worse while at the same time softened by economic growth while it lasts. Turkey's EU candidacy factors into this scenario in as much as relations with the EU are becoming ever more conflictual and Cyprus' negative role in those relations is becoming increasingly costly.

2) Amicable divorce (or partition) à la Czechoslovakia: A voluntary separation would presuppose full mutual recognition and a commitment to non-confrontational politics, conditions that do not appear to exist at the moment. Voluntary partition would result in a fully sovereign Turkish Cypriot state, which, alongside Turkey, would eventually become a member of the EU. In fact for some participants in the workshop, amicable divorce may not be considered a taboo and if executed wisely, could lead to an arrangement quite close to that of a loose federation.

3) Conflictual divorce à la Yugoslavia: There was agreement between the workshop participants that this worst case scenario needs to be avoided at any cost, as it would further deepen the abyss between Greek and Turkish Cypriots and place Turkey firmly outside the European Union. Annexation of the north by Turkey would be a probable result.

4) A cooperative status quo: So as always with the cycles characterizing the Cyprus question, we are back to assessing the parameters of the fourth scenario, that of significant cooperation. Here, the cost of incremental divergence leading to one of the first three scenarios (with some likelihood attached to each of them) create enough incentives for actors to seek ways to balance these costs through greater cooperation between the two sides, in areas ranging from trade to education, the environment and culture.

Despite their ostensible differences, these scenarios converge around the continued division of Cyprus. Of the four scenarios, only the last has the potential to lead towards a settlement.

Under what conditions, we asked, would cooperative moves constitute building blocks for renewed attempts at a political resolution? Would the need to adapt the parameters of conflict resolution to the legal, institutional and political realities of EU membership make such efforts easier? Under what conditions would a ‘Europeanization' of the conflict lead to incremental re-unification or to a scenario of amicable divorce?



Strategies and risks for the future

• Confidence building measures and constructed deals, which condone changes on the ground (on property, mobility.) It was important that key actors think through carefully how some incremental changes open or close options towards a comprehensive settlement.

• Waiting for the right time and seizing “windows of opportunity” for reconciliation requires changes in perceptions, attitudes and incentives. However, decision makers and opinion leaders on both sides need to address the question under which conditions they consider reconciliation a desirable option.

• Giving scope for economic factors to play a positive role in paving the way for reunification. Economics were a sticking point in 2004 because both sides pointed to the income gap between the two sides. Today, both sides enjoy rising levels of economic development, albeit development that is much higher and more sustainable in the south, and more problem-laden in the north.



EU is crucial

In this context, the European Union is crucial. To assess its potential role, we must take into account at least three realities. First, the EU, like other international actors, has limited capacities in that it cannot “impose” a solution, especially having lost the pre-accession conditionality card vis-à-vis the Republic of Cyprus.

Second, the acquis defined in a broad sense to include the process of learning across national experience, constitutes a strong new constraint in defining the contours of a new settlement. Third, the vision of Cyprus's future as a EU hub in the Eastern Mediterranean differs substantially from its current role as a flashpoint and source of difficulties for the EU.

So the workshop tabled a paradox: the EU as a constrained giant may be poorly equipped to promote new solutions for status issues of its own members - witness Northern Ireland – and yet can be a powerful force in shaping the basic parameters of outcomes in a process “managed” by the key local actors and the UN. Perhaps in the belief that this ambiguity can be used fruitfully, all participants seem to converge on the call for the EU to adopt a more active role, progressing simultaneously on different layers of the Cyprus issue.



EU could be more constructive

The EU could play a more constructive, pro-active and creative role in exploring alternatives. The Annan Plan was influenced by historical models of bi- or multi-community governance such as Belgium or Switzerland and sought to conceive a grand plan for Cyprus by adapting some combination of these models. It therefore lacked the dynamic qualities of the European project, the idea that realities are shaped by spillovers and constructed solidarities, and by the constraints of legal enmeshment.

Even if creeping divergence now best describes processes on the ground, options that further augment the division and cause inter-community relations to deteriorate would do disservice to all parties involved.

While recognizing the political facts in Cyprus, Turkey and the EU, the open-ended spirit of the meeting led participants to call for decision makers and opinion leaders on all sides to consider whether aspects of the ‘Europeanization' scenario might create windows of opportunity to break the status quo and prevent the most undesirable scenario of conflictual divorce.