EUROPE: Cyprus MEPs pull together to keep freeze on EU\’s direct trade move

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Cyprus’ six MEPs have pulled together in an effort extend the freeze on a 2004 EU recommendation that would allow direct trade between the bloc and Turkish Cypriots in the north of the divided island.


The pending matter was brought before a newly elected European Parliament committee to decide whether the matter should be put on the agenda for discussion.

The issue of direct trade between the EU and the occupied north of Cyprus was back on the European Parliament’s agenda because every five years, the newly-elected body revisits all matters classed as pending.

The European People’s Party (EPP) asked for the issue to be scrapped, revoking a 2010 EU Legal Services ruling which said that the regulation lacked legal standing. Following the EPP’s request, the Socialists and Democrats asked for the matter to be tabled for discussion.

It will be discussed next week by the leaders of the European Parliamentary Parties where, as it would appear, a consensus has been formed to keep direct trade regulation in the deep freeze.

Confirming that this is the most likely scenario, DISY MEP Lefteris Christoforou told the Financial Mirror that: “The EPP has for some years taken the position that this directive and the direct trade proposal lacked a legal background and that it should have been withdrawn long ago.”

He added that since the EPP does not have a majority to get the regulation withdrawn “we will join other political groups, at least for it to remain frozen”.

Christoforou appeared dissatisfied with the S&D’s stance, saying that free trade between the occupied north of the island and the bloc would trash efforts to solve the Cyprus problem, as the Turkish Cypriot side would no longer feel compelled to sit at the negotiation table, with the Greek Cypriot side losing its leverage.

“In any case, Turkish Cypriots can trade with the EU, through the regulation of the Green Line.”

The EPP is the group with the most MEPs (182) in the European Parliament, though it does not hold a majority in the body.

The motion to keep the freeze is supported by the European United Left/Nordic Green Left (GUE), which is expected to vote to keep the freeze.

AKEL affiliated MEP Niyazi Kizilyurek said it is important not to adopt the free trade regulation. “Especially at a point when we are hoping that negotiations may be relaunched, we should not be seeking to change the balance.”

However, the first Turkish Cypriot MEP added “this does not mean that the directives regulating Turkish Cypriot trade with the European Union are fit for purpose. Far from it as it has a number of limitations.”

Kizilyurek said the Green Line regulation, as well as other measures designed to bring the Turkish Cypriot community closer to the EU, should be revisited.

“We want to enhance Turkish Cypriots’ daily contact with the European Union. That is why the Green Line and the Financial Aid regulations should be revisited.”

The stick approach

The direct trade regulation was proposed in July 2004, following the Turkish Cypriot community’s ‘YES’ vote in a referendum over a UN proposed settlement plan for Cyprus.

Failure of Greek Cypriots to back the Annan Plan saw a divided Cyprus enter the EU a week later with Turkish Cypriot out in the cold.

The European Commission at the time made three recommendations to help a Turkish Cypriot community seen more than willing to join the EU.

Brussels recommended the Green Line Regulation, the Financial Aid Regulation and the Direct Trade with the EU Regulation.

The recommendations were accompanied by a clear reference to the Turkish Cypriot vote in favour of reunification.

The latter would have allowed the same rules that govern north-south trade to apply to the whole of the EU: goods of Turkish Cypriot origin that pass health checks would be allowed into EU countries, except animal products and arms. Preferential tariffs would also apply.

Greek Cypriots argue its wording implies that it would allow for exports directly from the port of Famagusta, which the Cyprus government declared closed in 1974.

The regulation was put on ice after disagreements arose over the content of the regulation and the explanatory memorandum of the draft regulation refers to “rules applicable to third countries”.

Although the memorandum also adds that these rules also apply to other territories of the EU which are not part of the customs union, such as Gibraltar and other territories, European Parliament legal services issued a memo calling the regulation “lacking legal basis”.

A businessman with a different point of view is Andreas Lordos.

“The stick approach has nothing to offer towards finding common ground for a solution to the Cyprus Problem. Keeping the Turkish Cypriot community on their knees, by restricting their capacity to trade, will only lead them further into the arms of Turkey,” said Lordos.

Lordos, who recently ran for Mayor of occupied Famagusta as an independent candidate, coming third with 16.24% of the vote, openly supports direct trade between Turkish Cypriots and the EU.

He argues this could be done through Famagusta port being reopened under the auspices of the United Nations.

“I would much rather have a wealthy partner and neighbour rather than a poor one struggling to make ends meet.”

He said thinking that we have leverage over Turkish Cypriots at the negotiation table by keeping restraints on their trade capacity is not going to lead anywhere as they are turning more and more towards Turkey, who is providing them with solutions.

“Soon there will be an interconnection between the Turkish Cypriot community and Turkey’s electricity grid. Combined with the operation of the nuclear power station at the point of connection at Akkuyu, Turkish Cypriots could see their electricity bills drop to 1/10 of what they are today”.

He said this will make ties with Turkey even harder to break.

The current situation only pushes Turkish Cypriots into the arms of Turkey, said director of Sapienta Economics Fiona Mullen.

She said that allowing for direct trade between Turkish Cypriots and the EU could prove positive for both the community and the solution of the Cyprus Problem, only if it was part of a package agreement.

An agreement which would involve the lifting of the Turkish embargo on ships and planes flying a Cypriot flag, which would imply Turkey’s recognition of the Cyprus Republic.

“At the end of the day if you want Turkish Cypriots to be ready for a reunited Cyprus, they should be trading with Greek Cypriots and the EU," said Mullen.