Cyprus peace would bring in billions-academics

Cyprus’s economy would gain at least 1.8 billion euros on an annual basis if there were a reunification deal on the ethnically-partitioned island, economists said.

Economic benefits would come mainly from new business opportunities with Turkey, tourism revenue and construction, the survey sponsored by the Norway-based PRIO peace institute said.

“Translated into household income the annual dividend per family comes to approximately 5,500 euros per year,” PRIO said.

That represented 20 percent of the average income of Greek Cypriots, and 40 percent of Turkish Cypriots, it added.

Cyprus, an island of around one million people, was partitioned in a Turkish invasion in 1974 triggered by a brief Greek-inspired coup. Greek Cypriots, who represent the island in the European Union, have no direct trade or diplomatic links with Turkey just 60 km (37 miles) north of the island.

The southern areas of Cyprus controlled by the Greek Cypriot government joined the euro zone on Jan. 1 2008. The northern part, a Turkish Cypriot breakaway state recognised by Ankara, stayed out.

Economic disparities between the two sides are huge. Gross domestic product in the south was 15.5 billion euros in 2007, and approximately 2.0 billion euros in the north in 2006, according to the latest data available.

Economists from both sides of the divide based their projections on a seven year gameplan if a settlement were reached in 2009, and using Greco-Turkish trade relations, which have flourished in the past decade, as their reference point.

Greek and Turkish Cypriot community leaders are expected to meet in the last fortnight of March to discuss how to resume peace talks. Reunification efforts collapsed in 2004 when Greek Cypriots rejected a U.N. settlement blueprint accepted by Turkish Cypriots.

The Peace Research Institute Oslo (PRIO) is financed by the Norwegian Research Council, the United Nations and the World Bank. (Reuters)