Sunday, March 12, 2017

No Cyprus solution: no UN and no gas? - IN CYPRUS / CYPRUS WEEKLY

March 12, 2017
Fiona Mullen

Efforts to solve the Cyprus problem are dying fast. In an interview with Kibris on Monday, the UN Special Advisor, Espen Barth Eide said something that should wake everyone up on this island.

Translated back from the Turkish, he said: “If the process fails, I have the feeling that it will not be possible to expect the UN to come again after a couple of years when things improve and give it another try. I don’t know. This is why I am worried. I would be more worried if I were living here. I hope I am wrong but I have to say that I am worried it will not be a smooth exit.”

This is diplo-speak for: “If you don’t come back to the table, don’t expect the UN to try again”.
Why might that be so? First, US President Donald Trump’s scepticism about international engagement. The US funds 22% of the UN and I hear that UN agencies are preparing for at least 20% cuts across the board. A bean-counter nowhere near Cyprus will have to decide whether to put resources into getting food into in famine-stricken South Sudan and Somalia, or paying for fruits served at endless meetings in Cyprus.

Even the UNFICYP peacekeeping force should not be taken for granted. While Cyprus and Greece together fund 45% of UNFICYP (but not the Good Offices), it takes only one veto from one permanent member of the Security Council to end the 52-year operation immediately. In the old days, that used to be unthinkable. Today, nothing is unthinkable in international politics.

The second possible reason is Norwegian politics. According to unconfirmed rumours, Eide, a former foreign and defence minister, could be tempted to run for prime minister in order to counter a rising populist candidate. That could be the moment when the UN Secretary-General, Antonio Guterres, who has been described as “no pushover”, calls it a day.


Both TCs and GCs will be hit

The withdrawal of the Good Offices will be diplomatically uncomfortable for Greek Cypriots but it will hit Turkish Cypriots the hardest. It is only in the context of the negotiations and under UN auspices that Turkish Cypriots have access to the outside world. Even the EU’s financial aid programme, over which the Republic of Cyprus has a veto, is on condition that it is with a view to reunification.

The collapse of negotiations will hit Greek Cypriots through natural gas. Right now, the Republic of Cyprus (unlike Israel) has no binding export agreements, thanks largely to low volumes.

Let’s say much more gas is found quickly and Cyprus is finally ready for production in about five years’ time. Turkey has never made explicit exactly what it will do. But we know that it has said: “Turkey will continue to support the Turkish Cypriot side’s activities to protect their equal and inherent rights over the natural resources around the Island.” More recently, Turkey’s foreign minister, Mevlut Cavusoglu, said: “It is not possible for Turkey to stand still while the Greek Cypriots continue their unilateral activities without taking Turkish Cypriots’ legitimate rights 
[TEKMOR Note: of course Turks' interpretation of 'legitimate' is imaginative to say the least and shared by no one else] and interests into account.”

We also know that Turkey’s economy is heading for trouble and that US leverage over the country is weakening.

Just imagine what the Turkish leadership might do to deflect attention from a weak lira, high inflation and a restive population at home [TEKMOR Note: The author is lightheartedly propagating Turkish threats but fails to offer the counterview that Cyprus, exactly because of the potential of huge reserves and location, is vital to western and EU energy security not just as an energy source but also as an energy route. Cyprus' geostrategic significance explains the significant presence of ENI, Total, ExxonMobil and Royal Dutch Shell in its EEZ.]

Fiona Mullen is Director of 
Sapienta Economics and author of the monthly in-depth Sapienta Country Analysis covering politics including the Cyprus problem, natural gas, the banking sector, and fiscal and macroeconomic performance

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