A Cyprus Settlement: Win-Win in the Region and Beyond

Introductory Remarks by John Sitilides, Executive Director, The Western Policy Center

MR. SITILIDES:

Madame Ambassador, distinguished guests, colleagues, ladies and gentlemen: As Executive Director of the Western Policy Center, it is my pleasure to welcome all of you to our latest Policy Forum, and to offer a special welcome to our guest speaker, the Ambassador of Cyprus to the United States, the Honorable Erato Kozakou-Marcoullis.

Before we begin our program, I'd like to recognize several honored guests with us today: Deputy Assistant Secretary of State for European Affairs James Gadsden, State Department Director for Southern European Affairs Ann Korky (who returns to the Cyprus issue after being posted at our embassy in Nicosia fifteen years ago), Special Cyprus Coordinator Ambassador Tom Weston (who returns to Geneva next week for part two of round three of the proximity talks); former Cyprus Coordinator Ambassador Nelson Ledsky, now with the National Democratic Institute; former Congressman and U.S. Ambassador to Romania, David Funderburk, now with the law firm of Preston Gates; former State Department Coordinator for Counter Terrorism and U.S. Ambassador to Qatar, Patrick Theros, now with U.S.-Qatar Business Council; Major General Elmer Pendleton, U.S. Army retired, now Chairman of the American Turkish Council's Defense and Security Committee; and Capt. George Smith, U.S. Navy retired, former Greece Desk officer at the Defense Department, and now on the Western Policy Center's Board of Directors.

I'd also like to thank my colleagues at the Western Policy Center who organized today's forum, and extend our appreciation to the management and staff here at the Hay Adams for their eleventh hour scrambling to deliver us to this rooftop and its magnificent vista.

Before we begin, let me remind everyone that following the Ambassador's remarks, which will in fact be "on the record," we will have a moderated Q&A session. I will ask those of you with questions for the Ambassador to please write them on the notepads we have provided, and pass the sheets to our colleagues who will collect them during the presentation.

And now, Cyprus.

It is said that a bride at her second marriage doesn't wear a veil, because she wants a better look at what she is getting the second time around. In this context, the Greek and Turkish Cypriot communities, which were legally wed in 1960, separated in 1964, and divorced in 1974, are perhaps looking to remarry. Only now, they are keeping their veils off to get a better look at what they'll be getting this second time around.

This, my friends, is what we have come to know over the decades as the Cyprus settlement process. I was in Cyprus again just last month, and had the opportunity to meet with government officials, political and business leaders, and to travel to the north. As I noted to the Ambassador earlier, I returned home less optimistic about the prospects for a settlement any time soon.

But the U.S. continues, and rightly so, to encourage the settlement process and help achieve a just and lasting resolution of the vexing Cyprus problem. Which for many, begs the question: why does this quarrel in a country two-thirds the size of Connecticut, with a mere 700,000 inhabitants, matter very much here in Washington?

Strategically, the United States has a paramount interest in a peaceful resolution that enhances the security of Greece and Turkey, both valued NATO allies. From a broader perspective, Cyprus sits astride critical maritime lanes and aviation corridors across the Eastern Mediterranean, south of Turkey's lengthy southern coast, east of Greece's Aegean islands, just a few dozen miles from Israel, Syria, and Lebanon, and directly north of Egypt and the Suez Canal. British sovereign bases on Cyprus facilitate U.S. and NATO reconnaissance activity in the Middle East, the Caucasus, the Persian Gulf, northern Africa and southeast Asia.

Economically, Greek Cypriots have created a lucrative regional offshore center for finance, communications, and professional services, while Turkish Cypriot per capita income is 75% lower, with little hope for prosperity without a settlement.

On a human level, Greek Cypriots seek strategic security, to live free from fear of invasion, a freedom denied since 1974. Turkish Cypriots seek personal security, to live free from fear of physical attack, a freedom denied from 1963 to 1974. As a result, most Turkish Cypriots welcome the presence of 30,000 Turkish troops, which Greek Cypriots and many countries in the world deem an illegal force.

All these interests - strategic, commercial, and humanitarian - remain unsecured so long as political discord and military tension prevail on Cyprus. In his July 18 Foreign Affairs column in the New York Times, Thomas Friedman noted that Beirut, once the bridge between the Arab and Western worlds, is being replaced by Dubai in the United Arab Emirates.

At the Western Policy Center, we will posit that Cyprus, as the common reunified republic of Greek and Turkish Cypriots alike, should serve as the geostrategic bridge spanning from the European Union - which it will soon join, which Turkey aspires to join, and of which Greece is a full member - and the Middle East, at this crossroads of continents. Of course, you can always read more about everything else that we posit on Cyprus and the eastern Mediterranean at www.westernpolicy.org.

These are just some of the themes which our speaker will address this afternoon. Dr. Erato Kozakou-Marcoullis was born in Limassol, Cyprus. She is an attorney and a doctor of Social Studies with her Ph.D. from the University of Helsinki. She began her distinguished diplomatic career in 1980 as an advisor to the Cyprus mission at the United Nations, and has served in various posts in the Cyprus Ministry of Foreign Affairs, and on numerous U.N. commissions on subjects such as women's issues, racism and apartheid, and international human rights. Previously, she served as Ambassador to Sweden, and has served as Ambassador of Cyprus to the United States since September 1998.

Today, she is with us to present her topic: "A Cyprus Settlement: Win-Win in the Region and Beyond." Ladies and gentlemen, on behalf of the Western Policy Center, it is my pleasure to introduce to you, the Ambassador of Cyprus to the United States, Ambassador Erato Marcoullis.

Remarks of Ambassador Erato Kozakou-Marcoullis:

I wish at the very outset to thank the Western Policy Center for organizing this event and, particularly, I wish to express my deep appreciation to its very dynamic and energetic Director, John Sitillides and his able collaborators and staff, for making this possible and for securing such a wide attendance. This proves the Center's effectiveness as well as its reputation as a serious center for foreign policy research and analysis on the issues of our region.

When a few weeks ago we were exchanging views with John and I expressed my wish to share with the partners and the many friends of the WPC some of my thoughts about Cyprus and its future as we envision it, I admit that I did not expect that there would be such a response. I wish to thank all of you for taking the time to come and for the interest shown in Cyprus.

I realize that you come from different fields of interest on the various aspects of the issue or relevant to the issue at hand and I, therefore, hope that I will be able to address your concerns and interests with my presentation or later on during the Q&A period.

As you have noticed from the title I chose, "a Cyprus settlement: Win-Win for the region and beyond", my intention is to talk about the future and give a message of hope, for I am personally a strong believer in the notion of the cup being half full and not half empty. I also strongly hold that visions are the source of change and transformation, the basis of the everlasting evolution of ideas and policies.

Let me first make clear what I mean by my title and explain how I plan to proceed. With a Cyprus settlement I presuppose a settlement of the longstanding Cyprus problem, which will be the outcome of the free will of the people of Cyprus, the result of substantive and successful negotiations between the two communities, the Greek Cypriots and the Turkish Cypriots. I shall not go into any detail on the form of the settlement, except to reiterate the parameters that have already been agreed and that have been endorsed repeatedly by the United Nations Security Council:

"?a Cyprus settlement must be based on a State of Cyprus with a single sovereignty and international personality and a single citizenship, with its independence and territorial integrity safeguarded, and comprising two politically equal communities, as defined in the relevant Security Council resolutions in a bi-communal and bi-zonal federation and that such a settlement must exclude union in whole or in part with any other country or any form of partition or secession".

This bi-zonal and bi-communal Federal Cyprus, which will be also demilitarized as envisaged by Security Council resolutions, will be a member of the European Union with all the obligations and the benefits deriving from membership. I shall explain, in particular, the many benefits of Cyprus' accession for the population as a whole and for the two communities separately, with particular emphasis to the many benefits for our Turkish Cypriot compatriots. I shall also explain the benefits for Europe itself from having a reunited Cyprus as a full-fledged partner.

The win-win argument will then move to the relations between Greece and Turkey, two important NATO allies that have been adversaries for far too long, with the Cyprus problem being the primary poison preventing a stable and peaceful cooperation. I will analyze separately the benefits for Greece and Turkey and expand on how this new positive environment will affect the strengthening of the NATO Alliance itself, especially as it moves towards its new role in the 21st Century.

I will also talk about the positive spill over effect for southeastern Europe, the Eastern Mediterranean, the Middle East and the United States. Finally, I will argue that the United Nations itself, which has been preoccupied with the Cyprus problem for decades, will also win from a Cyprus settlement.

Let me now take you for a journey forward in time and share with you the elements of our dream by illustrating the win-win situation that, I believe, will prevail on the island, in the region and beyond.

The year is 2005. A Cyprus settlement has been reached and a Federal Republic of Cyprus is already member of the European Union, participating actively with Greek and Turkish Cypriot Ministers, Parliamentarians and other federal and local officials in all the Institutions of the European Union: the Council, the Commission, the European Parliament, the Committee of the Regions, to mention just a few. The advantages from such membership for Cyprus as a whole definitely encompass political, economic and social benefits on which I will elaborate briefly.

As part of a European Union, which was born out of former adversaries who came together in partnership and developed common objectives for freedom, security and justice, for economic and social progress and for common foreign and security policies and prospects, the two communities of Cyprus would learn to heal the wounds of the past and build bridges of cooperation and trust between them. The suffering and pain they inflicted on each other in the past, would be replaced by a process of forgiving and reconciliation, seeking elements that unite them in a common European environment, in a common future.

Both communities consider security as one of the core issues of their relationship and peaceful coexistence. Membership of a federal Cyprus in the European Union will provide them with maximum security not only from the fact of being part of a larger European family of nations, but, more significantly, because of the very nature of the EU as a Union where democracy, liberty, respect of fundamental human rights and the rule of law play a central role. The Union, formally empowered by the Amsterdam Treaty, has both the power to act as a deterrent to any violations and to take appropriate action to combat any form of discrimination based on sex, race or ethnic origin, religion or belief.

Membership would also allow Cyprus to fully participate in all the decision-making mechanisms of the European Union and contribute to the shaping of policies and decisions that may affect the interests of the country or welfare of its people.

European Union citizenship, which is a uniting factor among the peoples of Europe, will also be a uniting factor for the two communities who will develop bonds characteristic of a common European identity not only with the other peoples of the EU but also among themselves. At the same time, they will be able to develop and safeguard their own cultural identity within the context of a federal Cyprus and as a result of the very practices and policies of the European Union, which is itself an example of a multi-cultural, multi-ethnic, multi-religious union of peoples. Through their participation in the Committee of the Regions the two constituent parts of the federation, will be able to be involved in shaping Community policies and programs in such areas as economic and social cohesion, health, education and culture.

The economic benefits from membership for the country as a whole are so many that I shall limit myself to mentioning just a few:

1) Access of Cypriot goods and services to a huge single market.

2) The participation of Cyprus in the Union's internal market, an area where the free movement of goods, services and persons is ensured, will lead in the medium and long term to a more efficient allocation of factors of production towards activities with favorable advantages to Cyprus and to economic growth and employment for the whole population.

3) Attraction of investment from the EU and other countries, thus strengthening Cyprus' recognition as a regional business center.

4) Adoption of the EURO and participation of Cyprus in the Economic and Monetary Union, will lead to lower inflation and interest rates and increased exports, with positive effects on growth and prosperity.

5) Increased financial assistance from the EU to Cyprus through the Structural Funds.

I referred earlier to the demilitarization of Cyprus, which should also be seen as a win-win situation from the political, security and economic point of view. With no armies, no weapons and no defense spending the Federal Republic of Cyprus will be able to use all the monies thus saved for the economic and social progress of its people. Better hospitals, better schools and Universities as well as a better infrastructure will be built for the benefit of the entire population of the island. Cyprus' membership in the Western European Union and the presence in Cyprus, for as long as it will be deemed necessary, of a multinational force under a UN mandate, will also provide the much needed feeling and guarantee of security to the population as a whole and to its respective communities. Demilitarization of Cyprus would also benefit the EU itself, the UN, which has already endorsed the notion, as well as NATO and the OSCE, particularly through the removal of the military element from Cyprus and the elimination of the danger of a military conflict between two important partners in the Eastern Mediterranean, Greece and Turkey.

Let me now talk for a while about the Turkish Cypriots and how the solution of the problem through reunification and full membership of a Federal Cyprus to the EU will have particular advantages for them. The Turkish Cypriots will benefit from membership much more than any other section of the Cyprus population and their income and living standards will be rapidly brought to the level of the rest of the population. It is estimated that a sharp increase in wages by more than three times the present level will occur. For many this increase will be immediate as a result of the establishment of a single market for goods, labor and capital, for others wages will rise rapidly and approach those of the rest of the population within a relatively short period of time, that is 2-5 years after Cyprus' reunification and accession, through coordinated policies and programs aimed at balancing the economic levels of the two communities.

It is well known that the economic and social conditions of the TC community had fallen very much behind the rest of Cyprus since the Turkish invasion and the division of the island in 1974. At the present time, the Government-controlled area has a $15,000 per capita income and ranks 22nd world wide in the Human Development Index, while in the areas under the control of the Turkish army the per capita income is a mere $3,500, with high inflation, heavy emigration and problematic economic and social conditions. With EU Membership and reunification, the normalization process and the development assistance of the structural funds, the European Investment Bank facilities and loans and the Cohesion fund, will strengthen national policies for a balanced and sustainable development. Based on assessments of the European Commission, "the integration of the northern part of Cyprus, especially if taking place in the context of Cyprus' accession to the EU, will not raise major economic difficulties, because of its relatively small size and its potential, in particular in terms of agriculture and tourism".

European Union citizenship will provide the Greek Cypriots and Turkish Cypriots with the same rights as the rest of the citizens of Europe enjoy. This means that Cypriots will be able to move and settle freely within Europe and will be entitled to protection by any embassy of the EU in any third country. They will have freedom of employment in any EU country of their choice and the right to participate in the local elections of that country, or in elections to the European Parliament. Turkish Cypriot youth will have the right to study free in Universities of EU members and their opportunities for an increased standard of living and the quality and quantity of job opportunities in their own country will result in the reduction of emigration, that had drained the Turkish Cypriot Community in the past.

Turkish Cypriot businesses will flourish in the new European environment, though some may face unavoidably adjustment problems, which will have to be met by industrial restructuring and modernization. In general, agriculture, manufacturing and tourism will benefit enormously from the reunification and accession, as a result of better prices, better access to the huge EU market, greater assistance and greater spending power of the population.

In sum, through a Cyprus settlement and through membership of a reunited Federal Cyprus to the EU, Turkish Cypriots will be able to balance their income and living standards with the Greek Cypriot Community and ensure that they can compete effectively and in a healthy way with their compatriots, being able to develop in full their entrepreneurial and productive abilities for their own benefit and for the benefit of the island as a whole.

What about Europe? How will a Cyprus settlement and the accession of a Federal Cyprus benefit Europe? For Europe a peaceful settlement of this longstanding problem and having a free and whole Cyprus as a partner in the EU, would be of tremendous advantage. It would prove the catalytic role of the accession process in solving problems and its therapeutic effects in situations where conflict was for long the name of the game, thus improving the reputation of the European Union as a union dedicated to peace, cooperation and economic progress. In addition, the end of the Cyprus problem would go a long way in improving relations between Greece, a member of the EU and Turkey, a candidate for membership and could open the way for an unimpeded process for Turkey's accession course. Furthermore, through Cyprus' accession, the EU would take in its midst a strong and vibrant economy, which would be even stronger following reunification. Cyprus would be an enthusiastic member of the EU, participating actively and contributing positively to its work. Finally, Cyprus would be an important bridge and the easternmost outpost of the European Union to the Middle East, with all the political and economic benefits that this would entail for the EU and for the region.

Let us now turn to another win-win situation, which is indeed very vital for peace, stability and prosperity in the region, i.e. relations between Greece and Turkey. Some may argue that relations between these two NATO allies were strained anyway much before the Turkish invasion in 1974 and therefore a Cyprus settlement and membership to the European Union would not have any effect towards bettering their relations. I would strongly disagree. Greece and Turkey may have a number of other serious issues on their diplomatic agenda, but the Cyprus problem and Turkey's policies in Cyprus, particularly since 1974, have been the main source of tension between them, have poisoned their relations over the years and have brought them at times at the edge of war. Being both partners in the NATO alliance and taking into account the military strength and arsenals in both countries, the risks of an escalation of tension are too obvious, threatening regional peace, as well the integrity and coherence of the eastern flank of NATO. This was true during the cold war, but it remains true in a post-cold war, 21st century situation. There is, therefore, no doubt that a Cyprus settlement would certainly contribute considerably to the improvement of the climate between the two allies and would greatly facilitate the settlement of other existing differences. The recent warming of relations following Balkan developments, earthquake diplomacy and the Helsinki decisions, is proof of the catalytic effect that such developments can have on the relations between these two countries. Both countries have some of the highest defense spending in Europe and NATO and would stand to gain from full normalization of their relations, by freeing important funds now used for defense spending, that can be used for furthering economic development and the prosperity of their peoples. This is true for both Greece, which is now moving steadily for membership in the EMU, as well as for Turkey, which has to tackle substantial structural reforms in preparation for its accession process.

Turkey, who is a key and crucial player in the whole equation, would also stand to benefit from a Cyprus settlement and membership of a Federal Cyprus in the European Union. Following Helsinki, Turkey is now heading towards the same destination. Accession of a Federal Cyprus to the European Union would entail participation of Turkish Cypriot federal Ministers in meetings of the Union's Council of Ministers, participation of Turkish Cypriot parliamentarians in the European Parliament and other Turkish Cypriot officials in all of the European institutions, apart from the fact that the Turkish language, which would be one of the official languages of the Federation, would also conceivably be one of the official languages of the Union. That is, Turkey would have its language introduced in the European Union much before her own accession.

Some have argued over the years that the European Union is not frank with Turkey and that it should have told Turkey honestly that it can never accept a non Christian state in its midst. Though I cannot speak on behalf of the Union, I strongly believe that this is not the case. First, because the Union would have never accepted to grant Turkey the status of a candidate country, if it was not serious about its ultimate intention. Second, by being ready to accept Cyprus as a member, with 18 percent of its population of the Moslem religion, it shows that religion is not an obstacle for membership. If Turkey would have undertaken all the important economic, political and human rights reforms that have to be made, would have adopted the European acquis, would have cooperated for a Cyprus settlement in compliance with UN resolutions and would have solved its differences with Greece by abiding by the rules of international law, the European Union would have to treat Turkey in exactly the same way that other candidate countries have been treated over the years, by offering membership. In this, a Federal Cyprus, as member of the European Union, would be fully prepared to support Turkey.

Finally, a Cyprus settlement would remove a serious obstacle in Turkey's relations with other countries, would improve its international status and would strengthen pro-Western forces in the country. Taking into account the geographical proximity of Cyprus to the Middle East, a Cyprus settlement would also have positive spill over effects for the region.

In sum, a long awaited cooperation on the part of Turkey for the solution of the Cyprus problem, by withdrawal of its 35,000 troops from Cyprus and an end to the division of the island and its people, in compliance with UN resolutions, could have long term economic and political benefits for Turkey, as well as long term benefits for peace, stability and prosperity for the entire Eastern Mediterranean region, Southeastern Europe, the Middle East, NATO and US vital interests in the area.

The UN, which has been preoccupied with the Cyprus problem for decades, having spent considerable energy and money in efforts to find a solution throughout the years will also stand to benefit. A Cyprus settlement would be a much needed success story for the UN, especially at a time that its prestige and its ability to cope with difficult, intractable problems is being questioned.

Finally, let me talk about US interests and how they would be affected from a Cyprus settlement.

President Clinton in his 1999 report on "National Security strategy for a new century" rightly assessed that European stability is vital to US security and stressed that the US has two strategic goals in Europe:

1) To build a Europe that is truly integrated, democratic, prosperous and at peace, a realization of the vision the United States launched 50 years ago with the Marshall Plan and the North Atlantic Treaty and

2) To work with allies and partners in Europe to consolidate this region's historic transition, in favor of democracy and free markets; to support peace efforts in troubled regions; to tackle global threats and to build a more open world economy.

As far as Cyprus and the Aegean are concerned, President Clinton emphasizes in the same report that the goals of the United States are to stabilize the region by reducing long standing Greek Turkish tensions and pursuing a comprehensive settlement on Cyprus. He also adds that a democratic, secular, stable and Western-oriented Turkey is critical to these efforts.

Now, the question is how a Cyprus settlement and the accession of a reunited Federal Cyprus would fit in the framework of serving US interests in the region as outlined by President Clinton?

The answer is simple and it derives exactly from the goals set by President Clinton's report that I have just mentioned. It also recapitulates the main elements of my talk today:

1) A Cyprus settlement would serve the strategic goal of the US for a truly integrated Europe: democratic, prosperous and at peace. As we have seen earlier Cyprus and its people would prosper as a result of a reunified Federal Cyprus, member of the European Union and improved security and stability would prevail in the country and the region.

2) A Cyprus settlement and the demilitarization of the island would eliminate the threat of conflict on Cyprus and reduce the likelihood of conflict in the region;

3) A Cyprus settlement would strengthen NATO by eliminating a source of tension between two allies, Greece and Turkey, by improving their relations, by strengthening the southern flank of NATO and by strengthening NATO cohesion,

4) A Cyprus settlement would benefit much closer relations of the US with both its allies, Greece and Turkey.

5) A Cyprus settlement would boost the economic development of the three countries, Cyprus, Greece and Turkey, by releasing funds now used for arms purchases and defense that could be otherwise used for development, economic growth and the prosperity and welfare of their people.

6) A Cyprus settlement, through reunification of the country and the economy, would boost economic growth and would increase trade between US and Cyprus, particularly filling the need for more US exports to Cyprus.

7) A Cyprus settlement would facilitate and expedite Turkish membership in the EU, which is key to US goals in the region.

8) A Cyprus settlement would remove a serious obstacle in Turkey's relations with the West, would improve the international status of Turkey and strengthen the pro-West forces in Turkey.

9) Finally, a Cyprus settlement would be important for the whole region and could positively affect stability in Southeast Europe, the Eastern Mediterranean and the Middle East, regions of vital interest to the US.

As far as Cyprus is concerned, firmly believing in the win-win argument, we have spared no effort and we shall continue to spare no effort to make our dream of the reunification of our island and its people and its accession to the EU a reality. We owe it to our children and to the future generations of Cypriots, Greek, Turkish, Armenian and Maronite Cypriots alike. It is a noble cause, which will guide us into the 21st century.

We can already see the day when our small island, firmly anchored in the European Union, will make its contribution to the common European objectives.

We can also see the day that Cyprus will play a more dynamic role as a bridge of friendship and cooperation between the European Union and the Middle East and as a success story and a true model of a multi-cultural, multi-ethnic, multi-religious, democratic society in the eastern Mediterranean.

We can definitely see the day when people on the island from both communities will join their energies and minds for common causes that unite them in their common homeland, instead of maintaining walls that separate them in an artificially divided country.

We are profoundly convinced that the overwhelming majority of Cypriots, Greek and Turkish Cypriots, Christian and Moslem Cypriots alike, yearn for a settlement and are eager to take their rightful place as an integral part of the European Union.

Let me conclude by my favorite quotation from a speech before the Congress last year by former US Senator and architect of the Northern Ireland peace agreement, George Mitchell:

"There is no such thing as a conflict that cannot be ended. They are created by human beings and sustained by human beings. They can be ended by human beings. No matter how ancient the conflict, no matter how much harm has been done, Peace can prevail."

I fully subscribe to such words of vision and wisdom. And if this has been proven true, in Europe, if it has been proven true in Northern Ireland, it can also be proven true for Cyprus. This is our vision for the 21st century, which I put before you today.