The paper begins with a brief historical background of the problem from the time of the Turkish invasion in 1974 to date. We cover the developments since 1974 and summarize the positions and actions the international community has taken on the problem. We continue by providing a brief history of the Cyprus - European Union (EU) relations. We then examine the positions on the prospect of Cyprus' EU accession of the main interested parties: the EU, Cyprus, Greece and Turkey. Then, we study and offer our own assessment of what the effect of Cyprus' potential EU admission is likely to be, especially from the perspective of the negotiations and the potential for a solution to the Cyprus problem. We conclude that Cyprus' proposed EU accession will be beneficial both for Cyprus and the European Union. Moreover, Cyprus' potential EU entry is likely to have an important effect on the negotiations for a solution to the Cyprus problem. Cyprus' proposed EU entry is likely to lead to more incentives and more willingness for a solution for both the Cypriot and the Turkish side and is likely to lead to a solution or at least increase the probability of a solution to the long lasting problem.

Cyprus is the third largest island in the Mediterranean with an area of 9251 square kilometers. Cyprus' estimated population at the beginning of this decade is estimated to be about 718,000. Population distribution by ethnic group is 81.7% Greek Cypriots and 18.3% Turkish Cypriots). Cyprus lies in the north-eastern corner of the Mediterranean sea, at the meeting point of three continents - Europe, Asia and Africa - a fact which has contributed considerably to the island's importance and development. Its strategic location has always rendered it a prey to the interests of foreign invaders and colonizers.

A coup was staged on July 15, 1974, by the military junta then ruling Greece with the ultimate aim of overthrowing President Makarios, the elected president of Cyprus who was supported by the overwhelming majority of the population. Turkey used this opportunity and invaded Cyprus allegedly as a "guarantor" of the island's independence but as it turns out, its sole aim was occupation. Indeed, on July 20, 1974, 4C,900 Turkish troops landed on the island assisted by Turkish air and naval forces, in violation of the UN Charter and the principles governing international law. As a result, approximately 40% of the total territory of the Republic of Cyprus, which in economic terms is much more significant than its size (accounting for 70% of the economic potential), came under Turkish military occupation and about 40% (250,000 people) of the total Greek Cypriot population fled their homes leaving their belongings behind and became refugees in their own country. Thousands more were abused or killed and many more disappeared and are still missing. Twenty four years since, the occupation troops are still present and the refugees have yet to return to their rightful homes. The status quo is slowly sinking in.

The Turkish invasion was regarded throughout the world as a brazen violation of Cyprus' sovereignty, territorial integrity and independence and provoked widespread condemnation from governments and international bodies. UN Security Council (UNSC) Resolution 353, adopted on the day of the invasion, stated that the UNSC was "equivocally concerned about the necessity to restore the constitutional structure of the Republic of Cyprus" and calls upon all states "to respect the sovereignty, independence and territorial integrity of Cyprus", demanding "an immediate end to foreign military intervention in the Republic of Cyprus."

One cannot stress enough the fact that occupying Cyprus had always been Turkey's secret aspiration. They would refer to it as taxim (partition in Turkish). Its first expression was declared with the publication of Dr. Kuchuk's book, The Cyprus Question - A Permanent Solution, where as its cover page was the map of Cyprus clearly divided in half (please see Appendix). The current land occupied by the Turkish army deviates from the original plan only in minor detail.

In 1983, Turkey declared the occupied northern strip of Cyprus, "The Turkish Republic of Northern Cyprus." This secessionist act was deplored by the international community. No country in the world recognizes this pseudo-state. In fact this illegal secessionist act was categorically condemned by the UN Security Council which declared it to be "legally invalid", called for its immediate withdrawal and asked states not to recognize it or facilitate in any way [UNSC Resolution 541 (1983) and UNSC Resolution 550 (1984)]. On November 15, 1983 a joint Resolution by both houses of Congress condemned the action with an overwhelming majority. On November 18, 1983 the White House issued a public statement announcing that the "Government of the United States condemns this unilateral action by the Turkish Cypriots, recognizes only one legal Government of Cyprus," and that the US President "not only has refused to recognize the Turkish Cypriot entity but has urged all countries of the world not to recognize it and to work for its reversal." Turkey has chosen to blatantly refuse abiding with international norms that guide the fundamentals of human rights.

Today, twenty-four years after the brutal act of the invasion which has scarred Cyprus permanently the Turkish military presence in the occupied area is overwhelming. The number of Turkish troops and armaments situated on that thin strip of land (barely 3500 square kms) has reached such alarming proportions that the northern third of the island of Cyprus is considered to be one of the most highly militarized areas of the world - a literal powder-keg ready to explode!

Given the number and intensity of UN resolutions on Cyprus, a natural question would be why the international community has not intervened militarily to restore international law and order as it did in the Iraq-Kuwait case. The United Nations has unanimously repeatedly called for the withdrawal of the declaration of the "TRNC" as it has also asked for the immediate withdrawal of the Turkish invasion forces in 1974 in a similar way as it did in the Iraq - Kuwait case. In the case of Cyprus, however, Turkey is an important NATO member and is considered a key strategic stabilizing force in the area both for the US and Europe. How a supposedly stabilizing factor has repeatedly threatened its neighbors, caused tension in the area, and continues to violate the human rights of the people in its area (including the Cypriots and the Kurds) is a factor the US and Europe have chosen to overlook. Moreover, Turkey invaded in 1974, a period of time when Cold War considerations made the presence of a strong Turkey an important buffer for the West against Russia. As a result, no military action was taken by the international community to implement the UN resolutions and restore international law and order and Turkish forces still occupy 37% of the island.

The Turkish invasion and the systematic ethnic cleansing that pursued led to the collapse of the Cypriot economic machine. Since 1974, the Greek-Cypriots and the Turkish-Cypriots have followed completely separate (and opposite) paths of economic development. Even though the occupied areas accounted for 70% of the country's GDP and wealth before 1974 (they generated the most revenues out of Cyprus' biggest industries namely, tourism and agriculture) and one would assume that its loss would have spirally affected the welfare of the Greek-Cypriots and improved the respective welfare of the Turkish-Cypriots quite the opposite happened. As a matter of fact, the socio-economic gap between the Greek-Cypriots and the Turkish-Cypriots has grown after 1974. Currently the per capita GDP in the free part of Cyprus is about four times that in the so-called "Turkish Republic of Northern Cyprus" while the total GDP is about 15 times as much.

Where can one attribute this? Well, according to H.E. Ambassador Nicolaides (Ambassador of Cyprus to the US from 1996-1998),' this can be attributed to the resilience, determination and entrepreneurial ingenuity of the Cypriots who despite the destruction and loss they suffered, they refused to give up. Following President Makarios' vision that only if the Cypriots were economically viable could they survive politically, they set out and disbanded their refugee camps and transformed themselves into a powerful labor force. The Greek-Cypriots managed in a period of two decades to perform what is referred to in economic case studies nowadays as "The Cyprus Miracle".

Another important reason why the socio-economic gap has widened to such an extent is the embargo which was imposed on the Turkish Cypriot side for violating the rights of the legal residents of the occupied part and not abiding with international law. There would be substantial economic benefits to Turkish Cypriots if the embargo were to be lifted. The total costs of no solution for the Turkish Cypriot side are, therefore, the foregone economic benefits from lifting the embargo, minus the benefits the Turkish Cypriot side enjoys by using almost 40% of the land, compared to an 18% population ratio. It is not clear whether these costs are substantial and it is also not clear whether they are enough to make the Turkish Cypriot side even want a solution.

The Greek Cypriots have a lot more to lose from the absence of a solution than the Turkish Cypriots. Firstly, there is the current feeling of insecurity which a large Turkish military presence in the north entails (Cypriots are afraid Turkey will want to occupy the rest of Cyprus). Then, there is the human pain experienced by the refugees who are still not able to go back to their homes. More importantly, Greek Cypriots are denied of their legal right to return to their homes and use their property as they see fit, thereby foregoing substantial economic benefits and personal happiness.

The island of Cyprus when considered from any point of view (whether that be historical, cultural, political) is an inalienable part of Europe. Ever since its independence in 1960 from the British, Cyprus has been following a European oriented policy.

Cyprus became a member of the Council of Europe in 1961. The following year, and trailing in the steps of the United Kingdom, it submitted an application to be considered for an association agreement. Cyprus' export trade was so heavily dependent on the British market that its initial interest in the European Economic Community (the forerunner of the EU) ran in parallel with the British full membership applications.

With the failure of the first British application, Cyprus' application never really went through. Cyprus' application was reactivated in December 1972 (as a result of the United Kingdom's likely entry into the European Community) with the signing of an Association Agreement (which effectively came in to force on June 1973). It provided for the gradual elimination of all trade barriers and the ultimate creation in two stages (the first until 1977 and the second to last five years till 1982) oŁ a customs union between Cyprus and the EEC.

However, the Turkish invasion of 1974 and subsequent occupation of 37% of the territory of Cyprus caused an economic choking of the Republic of Cyprus and basically interrupted the smooth implementation of the Association Agreement. It was impossible for Cyprus to keep up with the deadlines set by the Association Agreement. The second stage was never reached by the agreed time. In light of the disastrous consequences of the invasion, the Agreement was suspended and subsequently renegotiated and reactivated in 1978. "Cyprus lost its preferential treatment in the United Kingdom market. Nevertheless, in recognition of the exceptional circumstances following the invasion, Cyprus was permitted to export tariff-free most of its industrial products to the European Community. "2

After witnessing an important shift in Cypriot exports when in 1983 the European Community officially surpassed the Arab countries and became the biggest trading partner of Cyprus (both buyer and supplier), the protocol for the implementation of the second stage of the Association Agreement was signed in October 1987. This provided the establishment of a Customs Union between Cyprus and the EU.

On the 4th of July 1990, the Government of Cyprus (encouraged by figures of its spectacular economic come-back) submitted an official application for full membership in the EEC on the basis of Article 237 of the Treaty of Rome which provides that any European state may apply to become a member of the community. The European Council of Ministers examined the application and asked the Commission to give its Opinion. The Commission issued its Opinion (Avis) on Cyprus' application on June 30, 1993. In it the European Commission recognizes Cyprus' European identity and character and affirms that Cyprus satisfies the criteria for membership in the EU. It undertakes to open discussions with the Government of Cyprus and familiarize it with the acquis communautaire (the set of norms and regulations that a prospective member should satisfy) so as to prepare it for the forthcoming accession negotiations. (see Appendix C)

However, Cyprus' membership application had always been put on the back-burner as the EU had taken the view that a solution to the Cyprus problem should be a prerequisite for membership. This belief changed in June 1994, at the European Council meeting at Corfu. There it was concluded that Cyprus' application could no longer be held hostage to the continuous deadlock over its national problem. The Corfu decision stated that the next phase of enlargement of the Union would include Cyprus. Furthermore, it called on the EU to play an important role in facilitating a solution. This decision was confirmed in June 1995 by the European Council in Cannes.

In March 1995 the EU General Affairs Council decided that accession negotiations with Cyprus would start six months after the end of the 1996 EU Intergovernmental Conference. Three months later in Cannes, the European Council reaffirmed at the highest level the March 1995 ratification and precluded any third party from interfering in Cyprus' European orientation (a very important side-note to keep in mind when examining the attitude of Turkey in this matter).

In June 1996 the European Parliament blocked millions of dollars of EU aid to Turkey because it held it accountable for the lack of political progress in Cyprus and issued a resolution condemning the illegal presence of Turkish troops on the island. In July 1997 the European Commission's "Agenda 2000" report affirmed the Commission's 1993 avis (Opinion) on the Cypriot eligibility for EU membership, that accession negotiations will begin six months after the end of the Intergovernmental Conference and that the EU is determined to play a positive role in helping to bring about a lasting peace on the isle.

On December 1997 the European Council in Luxembourg decided to begin accession negotiations with Cyprus in March, 1998. Indeed, on March 31, 1998 formal accession negotiations between Cyprus and the EU and five more aspiring members - Poland, Hungary, Estonia, Slovenia and the Czech Republic began. The fall of 1999 has been set as the deadline for the ending of all the acquis screenings. What does this entail? This means that the European Commission and government experts from the aspiring countries sit down and compare policies in the economic and legal realm of the applicant country so that the necessary changes needed to be made to achieve harmonization with the EU are identified and taken care of in due time.

Since applying for full membership in 1990, the Cyprus government has systematically worked to harmonize Cyprus' laws and regulations with the acquis communautaire; which places Cyprus in an advanced stage of preparation for accession. "Whereas accession will be far off for all other candidates, things could go quickly for Cyprus," the European Parliament's representative on Cyprus' accession, Dutch Euro-parliamentarian Jan-Willem Bertens, said on December 22. "Having adapted to 80-90% of the acquis communautaire, Cyprus is in a very different situation from countries which have just adapted to 15-40% of the E.U. legislation."

The EU would certainly prefer a solution to the Cyprus problem before membership. Nevertheless, even in the absence of a solution, Cyprus can still become a member (as the EU stated in their 1993 avis).

Sometimes it is difficult to refer to a unique, single EU stand on Cyprus. There are, of course the official EU resolutions and decisions. These state that EU entry should not have a solution of the Cyprus problem as a prerequisite. However, occasional statements from a few EU country leaders trying to develop better diplomatic relations with Turkey and sometimes reap economic benefits sometimes cast some doubt on the official stand. France has been a notable example of such statements in recent months.

Now one can wonder what is it that Europe has to gain from an imminent entry of Cyprus into its halls? Well, Cyprus poses the greatest perhaps challenge for the EU to prove its worth on the international relations arena in the area of conflict resolution. So far all efforts undertaken by the US or the UN have failed to bring a solution. The EU will have made a great step cwarJ adopting a new role in European and international relations affairs if it is successful in contributing substantially toward a peaceful resolution of the problem. The solution of the problem and the accession of Cyprus to the EU would symbolize the commitment of the EU to decisive involvement in the broader region of Southeastern Europe. On the contrary, failure to follow an assertive policy may be indicative of the EU's failure to act, even on the basis of its own declarations. The EU wants to make up desperately for its diplomatic blunders in Yugoslavia, in an era where it is trying to re-invent itself and promote itself as a key actor in forging policy that would allow it to have an impact on the word stage. Solving the Cyprus riddle is an opportunity that the EU does not want to miss since it could provide the impetus to propel the organization to the forefront of the foreign policy arena.

As Rodney Wilson very correctly puts it, "as so often has been the case in the past, the position of Cyprus [was] that of [an] observer, unable to influence the affairs of great powers either politically or economically, even though these developments ultimately shaped its destiny."3 And this is indeed true when we relate it to its political situation. Cyprus has always paid the price for its physical division. For a long period of time, the absence of a solution to the division of Cyprus had been viewed as an obstacle for the accession of Cyprus to the EU. It is ironic in a way - how the line between aggressor and victim gets blurred and the victim is held hostage to a situation beyond its reach. The smart maneuvers though of the current Cypriot government, managed to turn things around (as we saw previously with the June 1993 avis ) and for once Cypriots can now feel optimistic and not that they are to blame for the occupation of the northern part of their island.

From an economic perspective though, the arguments supporting Cyprus entry to the EU can hardly be challenged. The figures would speak for themselves. Cyprus leads the aspiring group of 6 countries since its strong economy already exhibits the ability of satisfying most of the Maastricht Criteria set for accession. There is no doubt that many current EU members would carry this small island's standard of living. According to the Cyprus Mail, in World Development Indicators released by the World Bank, Cyprus is placed 16^th in world rankings for per capita income. These figures clearly "put Cyprus ahead of eight of the EU's 15 existing members."4 Thus, it is not expected that economic factors will pose an obstacle for Cyprus' membership to the EU.

The Cypriot government's main goal to achieve by entry in the EU is the removal of the forced divide present on the island. The 3 fundamental freedoms of the common EU - that of freedom of movement, settlement and acquisition of property - are clearly violated in Cyprus. And Turkey would like it to remain this way because if the opposite was in place, then they fear that the Greek-Cypriots (being more well-off than their Turkish counterparts) would end up buying their homes and land back. Upon Cyprus' entry in the EU family though, it is ironic to think that a Greek-Cypriot could travel freely to every corner of Europe and yet in his own country, the presence of foreign occupation troops forbids him to visit the northern part of his homeland. The Cypriot government's main goal of joining the EU is that the blatant violation of the 3 European freedoms will finally force a speedy and desirable solution on the Cyprus problem.

One would then rightfully think that the only issue holding Cyprus back is its political situation. What is interesting is to see why would the Europeans wish to acquire the "Cyprus Problem" headache? The EU has already shown signs of eagerness to branch out and cooperate with two regions: in the northeast with the Russian Federation and the ex-Soviet Republics and in the south and southeast with the Arab world. In such a very likely scenario, Cyprus would find itself at the focal point of this region not only geographically (due to its proximity and strategic location), but also economically and politically (Cyprus enjoys excellent relations with Russia and the ex-Soviet republics, and with the Arab world. These two regions are the biggest investors in the island's booming services and offshore sectors).

From a purely economic perspective, Cyprus' admission into the EU would lead to substantial economic gains. As in the case of any small nation, which is a price taker in the world economy, the gains from free trade with the EU would accrue mainly to the small nation and not to its larger trade counterpart.5 Furthermore, Cyprus is likely to receive substantial economic development aid from EU funds, an additional benefit to accession.

Thus, even though the Cyprus problem presents itself as a challenge to the EU, Cyprus entry to the EU (and a hopeful solution to its political situation) may generate another period of economic growth and development - a new economic miracle - fruits of which would be shared by both Greek-Cypriots and Turkish-Cypriots.

Greece traditionally served as a guardian of the Hellenic element in Cyprus. In recent years Greece has been the main advocate and supporter of Cyprus' application for admission. Greece, a member of the EU since 1981, has repeatedly used its power and influence within the EU to support Cyprus' application. The Greek government has supported the blocking or the postponement of EU financial aid to Turkey, as long as Turkey does not change its stance on Cyprus. In 1995 the Greek government withdrew its veto on an EU customs union with Turkey in exchange for the setting of a date for the beginning of formal accession talks between EU and Cyprus.

Greece believes there are important positive effects of the accession of Cyprus to the EU. Greece believes Cyprus' EU entry will act as a catalyst for a solution to the Cyprus problem. The Greek government firmly opposes the Turkish government's attempts to make the solution of the Cyprus problem a prerequisite for Cyprus' accession and wants the EU to make it clear that Turkey can not obstruct the future accession of Cyprus. "Cyprus remains a security issue for Greece, which needs to be integrated in the EU to contain an ever expanding Turkey"6

In addition, Greece has repeatedly warned Ankara against any further "adventurism" on Cyprus and has explicitly stated that an attack on Cyprus would be considered as an attack on Greece and lead to war. Currently, a joint defense pact between Greece and Cyprus provides air, sea and land cover for Cyprus (at least on paper) in the event of a Turkish offensive. Greece would like to see a "common foreign and security policy" implemented for the entire EU, therefore guaranteeing Greece's borders against Turkish aggression. Currently, the status of member state does not provide a clear commitment to defend each member's borders against aggressors. The hope that such a commitment (even though it is not explicitly stated) exists, is one of the main reasons behind Cyprus' application.

Turkey has maintained an Associate Member status with the European Community since 1963. However Turkey has long aspired to join this prestigious club of nations but its application has always been put on the 'wait-list stack'.7 As Rodney Wilson very briefly puts it in his book, Cyprus and the International Economy the main economic concern on the part of the European Union in the case of a Turkish integration would be that Europe would suddenly become infiltrated by vast numbers of low-wage immigrant Turkish workers (under the clause of the freedom of labor mobility). This would crowd out local European employment, and create huge problems of cultural assimilation. Wilson also raises another serious economic concern, "how can a country, that in many respect is on a Third World level, be incorporated into a rich community of nations. Turkey could hardly be expected to make a contribution to the European Community budget, and would be a substantial recipient of funds" (Wilson, p.62). Then there is the case of Turkey's very questionable human rights record.8 Turkey does not seem to be doing particularly well in that area, holding the world record in political prisoners (a significant number of whom are intellectuals and writers) after China. This is an issue that the EU cannot take upon lightly.9

Turkey and the Turkish Cypriot leadership are stubbornly opposing the current negotiations that Cyprus has under way with the EU insisting that Turkey should be the one to join first. Not only that but Turkish officials unleashed very harsh threats against the territorial integrity of Cyprus. Indicative is the statement proclaimed by Ismail Cem, the Turkish foreign minister on the day accession negotiations between Cyprus and the EU were announced and Turkey was not included in the group of countries earmarked to participate in the first or in the second wave of EU expansion. According to the Financial Times (3/31/98), "[Cem] said that [the] EU decision to start talks with the internationally recognized government of Cyprus was 'the first step towards escalation in the eastern Mediterranean, which can be very dangerous' " This position is incomprehensible at first, considering Turkey's long expressed eagerness to join the EU. This opposition can only be understood as a ploy on the part of Turkey to force its own entry into the Union. It also proves beyond doubt that the Turkish-Cypriot leadership in the occupied part of Cyprus is indeed under the control and direct orders of Ankara. In a show of cavalry and outreach, "Cyprus adopted a conciliatory tone. bannis Kasoulides, [the Cypriot] foreign minister, said EU entry should remain open to all countries including Turkey [provided] they respect EU principles." He once again stressed Cyprus' belief on how "entry negotiations would act as a catalyst to a political solution."11

The Cypriot government has tried to reach out to the Turkish-Cypriots in the north. Following his re-election in February 1998, President Clerides called on the T/C leader Rauf Denktash to "work with us for our common homeland. Let us start the process for creating a new Cyprus in a new century." Mr Clerides subsequently (in March 1998 and with the start of the EU-Cyprus accession talks) extended an invitation to the T/C community to nominate representatives to be included as full members of the Cypriot team negotiating accession. The invitation was rejected on the spot. The LU Presidency and member states applauded President Clerides' initiative12. The Turkish Cypriots should not miss this opportunity As Commissioner Hans van den Broek stated, "...it will be to the ultimate benefit of the island as a whole, and in particular for the Turkish-Cypriot community to participate in this historical enterprise."13 Nonetheless, in the word of Cypriot Foreign Minister Kassoulides,

According to a Communique issued by the European Commission and forwarded to the European Council and the European Parliament on July 5, 1997, the EU once again reconfirms "Turkey's eligibility for EU membership" and repeats that "Turkey will be judged by the same objective standards and criteria as other applicants." The correspondence attaches special reference on the issues that are still causing friction among the EU and Turkey. Specifically, it states that unless significant progress is made "in a number of fields" then Turkey's bid will not advance. In particular,

Therefore, the EU has expressed on many occasions, that it will consider Turkey's bid for membership using exactly the same criteria as for all other membership applications it is considering. Greece has on many occasions declared its approval of Turkey's EU aspirations provided the country respects UN resolutions on Cyprus and improves its human rights record.16 However, it seems that Turkey is requiring to be admitted to the EU on more favorable terms than the rest of the countries. In our view, standards and rules are there to be followed and we do not think that Turkey should be granted preferential treatment. Pre-set rules of conduct should be upheld. Turkey is illegally Occupying 37% of the territory of Cyprus despite numerous UN resolutions and is using its military might to blackmail Cyprus. Turkey is effectively holding the tiny island nation hostage in exchange for its own EU membership. If this gunboat diplomacy was to be rewarded by the EU by granting Turkey full membership, it would be a disgrace of the ideals that the emerging European family aspires to hold.

The Turkish Cypriot side, although it has been formally invited to join the negotiations as part of the Cyprus team both by Europe and by the Greek Cypriots refused, guided by the interests of mainland Turkey, mainly with the hope of being able to block Cyprus' entry by not participating. If the EU states that it will not accept the legal Cyprus government unless a solution is reached then the Turkish side will have gained tremendous power in the negotiations for a solution. The Turkish side may, for example, demand recognition in order to accept admission of the legal government. Actually, the leader of the Turkish Cypriots stated that the EC should recognize the "TRNC" and then accept the application of Cyprus. He proceeded to state that the application for admission represents only the Greek Cypriots and not the Turkish Cypriots and thus his side will not participate in the negotiations. It seems clear that the Turkish side is trying to use its potential ability to block Cyprus' entry into the EU, if the EU were to take the solution of the problem as a prerequisite for accession, as a lever to obtain substantial political benefits.

Turkey reacted to the EC's shutting its door to potential negotiations for Turkey's accession by hardening its stands in the Cyprus problem negotiations (through the Turkish Cypriot side) and by refusing to participate in EC political events, despite being invited to do so. On the economic front Turkey flexed its muscles by placing lucrative orders for the provision of weapons to its military it had previously planned to give EU countries to other parties, mainly the US.

The European achievement of creating the European Union is remarkable especially when one recalls that up to half a century ago, the armies of the member states of the EU were in two opposite camps. Now these countries work together to advance their mutual interests. The EU reconciled traditional animosities, old hatreds were buried and all nations were convinced that the unification of Europe would serve in everyone's interest.

Cyprus' entry provides an Opportunity for the EU to exercise its influence and promote a solution to the Cyprus question along the lines of the fundamental European principles of freedom of movement, freedom of settlement and freedom of acquisition of property. Cyprus is an inalienable part of Europe. The small size of Cyprus calls for a unified economy in which labor and capital are perfectly mobile while goods and services are traded freely. At a time when the EU moves forward consolidating its integration, at a time of globalization and cooperation, it is anachronistic for a small island to be kept forcefully divided by military force. The irony to it is that Turkey, the country which brutally enforces the partition of Cyprus and calls on the Turkish Cypriots not to accept the Greek-Cypriot proposal for participation in the joint accession group, is simultaneously aspiring to enter the EU.

Furthermore, if the accession of Cyprus to the EU promotes a just and viable solution to the Cyprus problem along the lines of European principles and ideals, this would be symbolic of the commitment of the EU to peace and stability. Such a solution will also create an important precedent in Mediterranean, European and international affairs (not to mention that it can serve as a stabilizing factor in the eternally strained Greek-Turkish relations).17 The EU will have made a big step toward adopting a new role in European and International affairs if it is successful in contributing substantially toward a peaceful resolution of the problem. The solution of it would symbolize the commitment of the EU to decisive involvement in foreign affairs. On the contrary, failure to follow an assertive policy may be indicative of the inability of the EU to act, even on the basis of its own declarations.

It is not expected that economic factors will be an obstacle for Cyprus' membership to the EU. According to Heinz-Jurgen Axt, the problem of Cyprus' accession is [purely] of a political nature as there are no insurmountable economic hurdles. Cyprus is a competitive partner for the EU; indeed, the Republic of Cyprus has a sounder economy than many of the other EU member states." (Heinz-Jurgen Axt, p.1) From an economics perspective, most of the benefits from EU entry are likely to accrue to Cyprus, given the small size and price taking nature of its economy. After entry to the EU Cyprus will be unambiguously better off. The economic benefits to the EU from the admission of Cyprus on the other hand are unlikely to be substantial. Taking Cyprus' economic strength, strong offshore sector and strategic position in mind, the island may prove to be a useful base for the EU when it comes to the offshore/services sector, providing access to the Gulf and East European regions.18

If Cyprus achieves entry in the EU the Greek Cypriot side has a lot to gain in the negotiations. Entry into the European Community will reduce the feeling of uncertainty and insecurity the Greek Cypriots feel concerning Turkish troops in the north. Turkey would not be able to attack a country that is a member of the EU. Turkey would thus lose the threat of the use of force as a leverage point in the negotiations. Furthermore, by not cooperating, the Turkish side foregoes more benefits (given that EU entry is economically beneficial for both Greek and Turkish Cypriots). Therefore, EU entry is likely to greatly improve the possibility for a solution, or at least shift the possible solution towards the Greek Cypriot side. If we accept the finding of many U N reports to date, which blame the Turkish Cypriot side for not cooperating, the Turkish side is exactly where the pressure should be focused.

In addition, addressing the issue from a "fairness" perspective the pressure should be focused on the Turkish side. Turkey is the country that is violating international law and human rights and reaping the benefits of that. Note that if the illegal "Turkish Republic of Northern Cyprus" ("TRNC") had been recognized and the embargo had been lifted, the Turkish side would no longer have an incentive to negotiate. Its best alternative to a negotiated agreement would actually be better than an agreement. If that were the case, the Turkish side would surely refuse to negotiate further. If the "TRNC" is recognized then Turkey no longer suffers the economic punishment and reaps all the benefits from occupying 40% of the land.

To avoid such an unjust outcome and to make the Turkish side negotiate, the international community in general and the EU in particular should ascertain that the "TRNC" will never be recognized. Furthermore, the embargo should be maintained indefinitely if not strengthened. This message should be conveyed strongly and credibly to the Turkish side. If Turkey is convinced that it no longer has the recognition option (or that the chances of recognition-embargo lifting are too low) it will have to negotiate and aim for a settlement. In our opinion the international community and the US in Darticular has failed to convince Turkish Cypriots that recognition is not an option and has also failed to impose sufficiently high costs to not negotiating. One can claim that the Turkish side believes that its self-proclaimed state will gain acceptance and legitimacy through time.

Given the above it should come as no surprise that the Turkish side has strongly opposed the Cyprus government's attempts to enter the EU. Turkey would like to be allowed to block entry, if it so desires. If we consider the Greek Cypriots' great desire to enter the EU, this reaction should be both expected and also not taken into consideration by the international community. The Turkish side has chosen to follow a hard line policy on the issue, threatening to permanently annex the occupied areas to Turkey if accession occurs. The international community should, in our opinion be able to call the bluff presented by Turkey and threaten with serious sanctions if annexation is attempted. Annexation is also probably going to encounter large opposition from within the Turkish Cypriot community. If a solution to the problem is accepted as a prerequisite, Turkey may be able to extract substantial political benefits in the negotiations in order to accept a solution, which in turn will lead to accession. The balance of political power would shift decisively in Turkey's favor and Cyprus' fate in Europe would become prisoner to Turkey's desires. In effect, the victim of Turkey's invasion in 1974 would be victimized once more and would be held hostage to the aggressor's desires. Therefore, it is the EU's responsibility to make it clear to Turkey that a solution to the Cyprus problem is not and will never be a prerequisite for accession. The EU should declare that, as long as Turkey occupies 40% of Cyprus, only the non-occupied part can (and will) join the EU. By so doing, the EU should make Turkey realize that it is now in its best interest to negotiate and stop being an obstacle to a solution to the Cyprus problem. The Cyprus occupation is not only a continuing financial burden on Turkey (estimates place the expenditures of Turkey on maintaining the 80,000 now armed forces to $250m/month), but a huge obstacle to Turkish ambitions for stronger ties to Europe. The EU must also make it clear that even putting aside the demands from the European Parliament concerning Turkey's dismal human rights and democracy, as long as the Cyprus question goes unresolved, Turkish membership in the EU is impossible.

The EU would certainly prefer the Cyprus problem to be solved before membership. Nonetheless, Cyprus should still be able to become a member, even without a solution to the Cyprus problem. With respect to this, it is critical to underline the terms of the Customs Union Agreement of Cyprus with the EC (signed in 1987) since its political implications are important. The provisions of this agreement refer to the Republic of Cyprus as a whole and not merely the area not under Turkish occupation. Also the mere fact that all meetings and negotiations (whose provisions apply for all the people of Cyprus) are conducted solely with the Cyprus government "…strengthens the Cyprus state politically and diplomatically at a time the pseudo-state is seeking international recognition." '9 Furthermore, by playing an active role in the finding of a solution, the EU will establish itself as a credible force in the preservation of international law and order, stabilize its Eastern side and help solve one of the most persistent problems of the 20^th century.

As the analysis presented above indicates, the European Union entry of Cyprus, if achieved, is likely to be the most significant factor that will lead to a solution of the Cyprus problem.

When Cyprus will become a member of the EU, the Cyprus Problem will become by definition, a European problem too. Instead of perceiving it as a nuisance, the EU should address it as an opportunity. By accepting Cyprus as a member, the EU will be sending a clear message about its commitment to acquiring an international political role. More specifically, the EU can play a critical role in the resolution of the Cyprus problem, thus reversing perceptions about foreign policy ineffectiveness.

Cyprus also has a lot to gain from EU admission, both from an economic perspective and from a political perspective. Membership in the EU can also increase the feeling of mutual security of all Cypriots. More importantly, EU admission is likely to provide an important leverage for a solution of the Cyprus problem, by providing additional incentives and by shifting the balance of political power away from the side responsible for the current impasse, Turkey. When Cyprus becomes a member of the EU, the Cyprus problem, the nightmare which has plagued the people of this small island in the Eastern Mediterranean, is likely to go away at last.

issued rejecting Turkey's pressure tactics on NATO enlargement and [categorically] ruling out Turkey's membership in the EU on grounds of its poor human rights record, its size and poverty and its Islamic background. (Lionel Barber, EUROPE June 1997).

12 Transcript of interview given by R.E. Ambassador Nicolaides to the Stanford Journal of International Relations on 4/28/98.

13 Joint Press Conference by the President of the Council of the EU, Austrian Foreign Minister, Mr. Schussel, the Minister of Foreign Affairs of Cyprus, Mr. Kassoulides, and the EU Commissioner for

15. Communication from the Commission to the Council and the European Parliament, "On the further development of relations with Turkey", COM (97) 394 final, Brussels, 07.15.1997.