FES CYPRUS NEWSLETTER NR. 69 / FEBRUARY 2018

Contents

1. Cyprus Problem ...... 2

2. Hydrocarbons ...... 4

3. Greek Cypriots ...... 5

Economic Developments ...... 5 Domestic Developments ...... 6 Labour Relations and Trade Unions ...... 6

4. Turkish Cypriots ...... 8

Economic Developments ...... 8 Relations with Turkey ...... 8 Domestic Developments ...... 9 Labour Relations and Trade Unions ...... 10

5. FES Cyprus Events ...... 11

FES NEWS

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FES CYPRUS NEWSLETTER Nr. 69 / February 2018

1. Cyprus Problem Foreign Minister, Kudret Ozersay suggested that a solution could be found that would allow In February, Turkey escalated tensions using Greek Cypriots to pursue offshore drilling, on war ships present in the Cypriot EEZ effectively the condition that Turkish Cypriots were in postponing the Greek Cypriot hydrocarbon some way included in these endeavours. He exploration program within Block 3 which was suggested that the Turkish side “should contin- assigned to Italian energy company ENI. This ue acting in a deterrent manner and that if nec- also had an immediate effect on the Cyprus essary a bilateral delimitation agreement with issue as both the problem itself and natural gas Greek Cypriots for separate EEZs “might come are now interlinked despite Greek Cypriot onto the agenda”. diplomatic efforts to keep them apart. In response Anastasiades stated that the Turk- On February 15, President Anastasiades met ish Cypriot claims were unjustified, given that with UNSG Special Representative Elizabeth an agreement was reached on the matter by Spehar in order to explore the prospects for the former president Demetris Christofias and for- resumption of the negotiations. Following their mer Turkish Cypriot leader Mehmet Ali Talat. meeting Anastasiades clarified that negotiations The agreement provided that any decisions could not resume while Turkey was causing ten- concerning sea zones, the continental shelf and sions in the Cypriot EEZ. the EEZ, will be handled by the federal govern- ment post-reunification. According to Anastasi- On February 18, CNN Turk reported that Turkish ades, the government had submitted a bill to Cypriot leader Mustafa Akinci would like to see parliament that provides for the creation of a a compromise formulated as part of an interim fund, similar to the Norwegian sovereign fund, solution to resolve the issue of drilling in the to administer proceeds from hydrocarbons thus Cypriot EEZ. Akinci warned that if such a formu- “securing the interests of existing and future la is not found the Turkish Cypriots, along with generations of all Cypriots.” Newly appointed, Turkey would launch its own hydrocarbons Foreign Minister Nicos Christodoulides also exploration in the island’s EEZ. responded to the comments made by Turkish On similar lines Turkish Cypriot Economy and Cypriot officials stressing that the Turkish Cypri- Energy Minister Ozdil Nami stated on February ot side is using the hydrocarbons issue as an 25 that Cyprus’ hydrocarbons programme excuse not to return to the negotiating table. should be co-managed or frozen until a Cyprus He called on Turkish Cypriots to decide whether solution was reached. He also threatened that they want a future with Turkey or within a re- Turkey would prevent drilling plans in all of united Cyprus Cyprus’ EEZ blocks. Meanwhile Turkish Cypriot

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On 27 February, Spehar met separately with of the Greek Cypriot presidential election) Turkish Cypriot leader Mustafa Akinci. Spehar attracted criticism, Akinci said that “this issue reiterated that the UN has requested that all was only made public recently following the parties reflect on the way forward and that the inquiry of the media. It is out of the question to UN is waiting to hear their views for a common accept the efforts made to present this as an approach on the way forward. Asked whether interference in the elections in the south”. any leaders meeting should be soon expected, Spehar stated that for the time being the par- Turkish Cypriot leader Akinci congratulated his ties are conducting preliminary discussions. Greek Cypriot counterpart Nicos Anastasiades on his election victory and said “I hope Mr. Ana- On February 14, UN Secretary General Antonio stasiades during his second term will follow a Guterres stated that a solution to the Cyprus more realistic and constructive policy for a Problem was the best way of resolving the comprehensive settlement and peace in hydrocarbons dispute between Cyprus and Tur- Cyprus”. key. Guterres regretted that tensions over hydrocarbons exploration had escalated and Turkish Cypriot negotiator, Ozdil Nami tendered stressed that all concerned parties should do his resignation to Akinci following his appoint- ment as the minister of economy in the new their utmost to defuse tensions. He recalled that the Turkish Cypriot and Greek Cypriot government. Akinci said, that he was not think- leaders had previously agreed that natural ing of appointing a new negotiator at this point, as he did not want the negotiations to drag on resources in a unified Cyprus would lie within the competence of the future federal govern- in the same way for another 50 years. “Negotia- ment. tions can only be possible if a strategic frame- work emerges provided that the Greek Cypriot In a statement to the Turkish Cypriot public side experiences a mental transformation and news agency, the presidential spokesperson truly accept the political equality of Turkish Cyp- Baris Burcu said, that the map which had been riots”, Akinci added. He reminded that the UN presented to the UN as part of talks on territory Secretary General Antonio Guterres had not at the Conference on Cyprus had been returned appointed a Special Advisor to replace Espen upon the request of President Akinci. Burcu Barth Eide following the collapse of the talks at reminded that following the failure of the Con- Crans Montana: “This shows us that there is no ference on Cyprus, the Greek Cypriot leadership such urgency”. had announced that it had withdrawn all pro- posals it had put on the table during the confer- The Turkish Cypriot Ministry of Foreign Affairs ence. When the timing of the statement (which issued a written statement condemning an attack against a Turkish Cypriot vehicle in the came only a few days before the second round

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FES CYPRUS NEWSLETTER Nr. 69 / February 2018

southern part of Cyprus. The statement called for military training until February 22. The initial on the Greek Cypriot authorities to take imme- Navtex was renewed on February 20 until diate action and punish those who carried out March 10, bringing the duration of the Turkish the crime. It noted that attacks against Turkish military exercises in the area to an implausible Cypriots have increased in recent months and 30 days. was becoming the norm and called on the Being under a blockade for two weeks, where it Greek Cypriot authorities to take serious action. remained immobilized at a distance of 50 km from the target, ENI’s drillship attempted for a second time on February 23 to reach Cuttlefish 2. Hydrocarbons but was again intercepted by Turkish war ships. As a result of the harassments, on February 26, On February 8, Italy’s ENI announced that it the drillship departed from Block 3 setting made a discovery of lean gas in the exploratory course for Morocco, where ENI has contractual well of Calypso, located in offshore Block 6 of obligations. the Cypriot Exclusive Economic Zone (EEZ). According to reports, Calypso is expected to Turkey claims it is acting on behalf of the Turk- hold somewhere between 6 to 8 trillion cubic ish Cypriots, who also have rights on the island’s feet (tcf) of natural gas compared to Aphro- natural resources. Moreover, Turkey does not dite’s 4.5 tcf found in 2011. According to a recognise the Greek Cypriot dominated Repub- statement released by the ENI, Calypso “is a lic of Cyprus, nor therefore that the Republic is promising gas discovery and confirms the entitled to the EEZ it has delineated with sever- extension of the Zohr-like play” into the Cypriot al of its neighbouring countries, or a continental EEZ”. shelf. In addition, Turkish Cypriots signed a Con- tinental Shelf Delimitation Agreement with Tur- The euphoria generated by the company’s key in September 2011. It is on this basis that announcement was spoiled on February 9, as Turkish Cypriots declared an EEZ of their own, ENI’s Saipem 12000 drillship was intercepted by which in effect claims that half of Cyprus’ EEZ Turkish navy vessels while on its way from Block belongs to them, including blocks 1, 2, 3, 8, 9, 6 to the Cuttlefish target located in Block 3 of 12 and 13. Turkey also has claims on parts of Cyprus’ EEZ. The warships which were partici- various blocks in Cyprus’ EEZ saying the areas in pating in military drills in waters off the east of question form part of its continental shelf. The the island, ordered the captain to change claim includes part of blocks 1, 4, 5, 6 and 7, to course. Turkey had issued, on February 6, a the south and southwest of the island. Navtex notice of its plans to mariners, reserving the island’s southern waters, including Block 3,

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The escalation of tension in the Cypriot EEZ further negotiations are underway between the caused various responses by the US and the EU governments to build a gas pipeline from but no action was taken to deter Turkey apart Cyprus to Egypt before mid-2018. from verbal condemnation. Commenting on the issue US ambassador Kathleen Doherty reiter- ated the US position as follows: “Our policy has 3. Greek Cypriots been very longstanding. We believe that the Republic of Cyprus has the right to explore and Economic Developments exploit its resources in its EEZ. We also have said publicly, and we have as a longstanding According to the European Commission statisti- position, that the resources should be shared cal office Cyprus’ unemployment rate fell from equitably with all Cypriots in the context of a 10.3% or 44.000 people in December to 9.8% or settlement.” According to a statement issued by 42.000 people in January. This was the first time the French president’s office, Emmanuel in six years that the unemployment rate fell Macron conveyed to Turkish President Recep below 10%. However, it still remains the fourth Tayyip Erdogan during a telephone conversa- highest unemployment rate in the European tion that he was concerned about recent events Union. off the coast of Cyprus, stressing “the need to respect Cyprus’ sovereignty.” European Council, According to the Statistical Service the govern- President Donald Tusk, on behalf of all EU lead- ment generated in 2017 a fiscal surplus on a ers, expressed his support on the sovereign cash basis of €360.7 million or around 1.9% of right of the Republic of Cyprus to explore and the economy compared to a surplus of exploit its natural wealth in accordance with €82.4million in 2016. Total revenue rose last European and international law, including the year by €564 million to over €7.2 billion in 2017 UN Convention on the Law of the Sea. mainly due to higher indirect tax revenue which rose by €305 million to €2.9 billion in 2017 Energy Minister Giorgos Lakkotrypis stated, that while direct tax revenue, rose by €41 million to Cyprus’ plans to explore develop and exploit below €2.2 billion. Government spending rose hydrocarbons in its EEZ will continue even if in 2017 by €195 million to well below €7 billion. ENI’s drilling in Cuttlefish has been postponed. The increase in spending was mainly due to a €84 million increase in current transfers to €1.5 Meanwhile on February 23, during his participa- billion accompanied by a €56 million and €41 tion in the Petroleum Week conference in Lon- million rise in wages and salaries and non- don, Egyptian Minister of Petroleum Tarek al- allocated expenditure to €1.8 billion and €528.4 Mulla announced that a preliminary agreement million. The statistical service also announced with Cyprus’ government has been signed and that the economic output expanded 4% in the

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fourth quarter of 2017 compared to the respec- • Participation in the EU’s formulation of a tive quarter of 2016. common foreign policy; • Strengthening ties with Gulf states;

• A formal linkage of Mediterranean’s EU Domestic Developments member states with neighbouring coun- tries; On February 4, Nicos Anastasiades was re- • Deepen relations with the five permanent elected as President during the second round of members of the UN Security Council; the Greek Cypriot Presidential elections. On February 13, Anastasiades announced the Anastasiades secured a comfortable win over composition of his new government. The new his opponent Stavros Malas garnering 215.281 cabinet which will be sworn in on 1 March is votes or 55.99% of the vote. comprised by: During his swearing in address to the House on Nicos Christodoulides, Foreign Minister; February 28, Anastasiades presented the new Harris Georgiades, Finance Minister; government’s domestic policy for 2018-2023 Giorgos Lakkotrypis, Energy Minister; which includes reforms in the public sector, e- Zeta Emilianidou, Labour Minister; governance, research and innovation, support Savvas Angelides, Defence Minister; for start-ups, people with disabilities, children’s Costas Hambiaouris, Education Minister; rights, anti-corruption, tourism and the devel- Constantinos Ioannou, Health Minister; opment of rural and mountainous regions. Vasiliki Anastasiadou, Transport Minister; Anastasiades stated that his government was Costas Kadis, Agricultural Minister; aiming for an unemployment rate of 4-5% and Constantinos Petrides, Interior Minister; the introduction of a national minimum wage Ionas Nicolaou, Justice Minister; for all occupations. Another priority would be to Natasa Pilides, Junior Minister for Shipping; further strengthen small and medium-sized Prodromos Prodromou, Government Spokesman; business (SMEs) by offering tax breaks and Klelia Vasiliou, Deputy Government Spokesperson; incentives, along with new programmes for Vasilis Palmas, Undersecretary to the President; women and youth entrepreneurship, the devel- Petros Demetriou, Head of the President’s office. opment of e-commerce and addressing the issue of non-performing loans.

With regards to foreign policy four axis were Labour Relations and Trade Unions announced: An agreement was reached in the construction sector between the trade unions and the Con-

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tractors’ Association in the presence of the Health intervened, promised immediate moves Director of the Industrial Relations Department by the government and the strike stopped. concerning the conversion of the key terms of The Cooperative Cyprus Bank attempted to fire the collective agreement into a bill to be voted into law by parliament. This has been a dia- a number of its employees because they have chronic demand of SEK, adopted in the last non-performing loans. ETYK, PEO, SEK and PASYDY issued statements threatening legal decade by PEO as well and is expected to protect both workers and businesses from measures as well as strike action and the man- unfair competition by contractors who do not agement of the bank was forced to retreat and give further time to these employees with abide by the collective agreement. respect to the issue of their non-performing A 24-hour strike took place by the Limassol loans. Buses with bus drivers demanding the reinstate- ment of their salaries and benefits to the pre- An agreement was signed between the Minister of Health and PASYDY stipulating the upgrading 2014 levels in the context of the renewed collective agreement. The issue has not been of a series of professions in the health sector in resolved. the existing pay scale of the public sector. This will be enforced in 2019. PEO reaffirmed its policy position to claim the The Committee of Employment of the European gradual return to the wages and the benefits existing in the pre-crisis period in the broader Parliament discussed the issues raised by the public sector and to engage in a more deter- union of temporarily employed academics of Cyprus, DEDE, such as the absence of rights for mined struggle against the deregulation of labour relations and against the covering of per- non-regular staff and the non-enforcement of manent needs with temporary, subcontracted the European Charter of Research and other EU recommendations. DEDE had also a strike at the and flexibly employed staff in the broader pub- University of Cyprus in January. The European lic sector. Commission responded that from its own part it PEO and SEK staged a series of assemblies and has issued a series of recommendations and protests of the municipal employees in all cities that it is the states and the universities that against the rising trend of outsourcing a variety should enforce them. The European MP Neoklis of activities, violating thus existing collective Sylikiotis who took the issue there, asked the agreements. European Commission to provide written steps that the Commission intends to take so that A strike took place at Makarios Hospital by the these recommendations are enforced in prac- hourly paid employees, primarily cleaners, pro- tice. testing against understaffing. The Minister of

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SEK had a meeting with the newly re-elected 4. Turkish Cypriots president of the Republic, Nikos Anastasiades providing him with its recommendations. These Economic Developments included the boosting of the collective agree- ments, the combat of unemployment, the non- According to the Central Bank figures, 83% of privatization of semi-public organizations, the the budget was financed by domestic revenues discontinuing of the policy of outsourcing work- in 2017. This was 69% ten years ago. posts in the broader public sector, progressive The average occupancy rate of tourist facilities tax reform and the enhancing of public services in the northern part of Cyprus increased in 2017 and local government efficiency. to 58.5% from 48.6% in 2016. The average occu- SEK and PEO condemned statements made by pancy rate of the casino hotels was 62.7%, the heads of the Cyprus Tourism Organisation while the average occupancy rate of the other and the Hoteliers Association (PASYXE) against hotels was 48.7%. hotel employees who, while being unemployed At 14.68% the inflation rate in 2017 had in the winter season and receiving unemploy- reached the highest level in recent years. The ment benefit, work in their fields or elsewhere. State Planning Organisation announced that the SEK stated that these people are outside hotel cost of living went down in January by 0.22%. work involuntarily in the winter season, that they are willing to undergo further training and Relations with Turkey that the problems will not be solved with such derogatory statements but through the upgrad- The Turkish Ambassador to Nicosia, Derya ing of Cyprus’ tourism services. PEO spoke Kanbay, visited the new Turkish Cypriot Prime about an “insult” to workers who enjoy their Minister Tufan Erhurman and presented a letter hard won right to unemployment benefit and from the Turkish Prime Minister Binali Yildirim. stated that the trade union movement will nev- Kanbay said “we wish you all the best and er accept the conversion of the unemployed express the Republic of Turkey’s support to into cheap labour for any employer. It is the your government”. Erhurman for his part hoteliers who avoid the risk of keeping their stressed that the relations with Turkey was of hotels open during the winter and who refuse vital importance. “I am sure that we will contin- to take up the partial cost of training sessions ue our relations with Turkey at the best level. during the winter for their employees, said PEO. We will show an utmost effort for this and we will continue working together in cooperation” the Premier said. Kanbay separately visited all ministers and wished them success on their new positions. Common message given by

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Kanbay to all ministers was “The state of the es”. Touching upon relations with Turkey, Republic of Turkey is beside the TRNC … Turkey Erhurman said that it was the duty of any gov- will always be the most important supporter ernment in office to establish good relations and assistant in all works to be carried out in with Turkey. He said that any party that failed north Cyprus for the future of Turkish Cypriot to do so was doomed to fail. He added that people”. negotiations on the new protocol to be signed with Ankara had already begun. Domestic Developments On February 2, the prime minister-designate After finalizing the work on the protocol at a Tufan Erhurman presented his cabinet to the meeting they held on the last day of January, President Akinci. The cabinet, which was the leaders of the Republican Turkish Party approved by Akinci is made up of following (CTP), the Peoples’ Party (HP), the Social Demo- members: cratic Party (TDP) and the Democratic Party (DP) signed the protocol for the new government in Tufan Erhurman (CTP), Prime Minister; a ceremony at the parliament on February 1. Kudret Ozersay (HP), Deputy Prime Minister Speaking at the ceremony, the CTP leader Tufan and Minister of Foreign Affairs; Erhurman said that the four parties had a com- Aysegul Baybars Kadri (HP), Minister of mon understanding on the principles on which Interior; they would be governing the country. He said Serdar Denktas (DP), Minister of Finance; that the goal would be to introduce sweeping Cemal Ozyigit (TDP), Minister of National public reforms and that coalition government Education and Culture; would work on the basis of creating a more Zeki Celer (TDP), Minister of Labour and Social democratic, free, egalitarian and inclusive coun- Security; try on the basis of the rule of law. Erhurman Filiz Besim (CTP), Minister of Health; admitted that the four-party coalition would Tolga Atakan (HP) , Minister of Public Works face challenges in solving the country’s out- and Communications; standing problems. However, he expressed his Fikri Ataoglu (DP), Minister of Tourism and belief that it would be possible to overcome Environment; these problems: “Everything is possible through Ozdil Nami (CTP), Minister of Economy and cooperation and good will. I believe this…I’ve Energy; seen this” he said. Erkut Sahali (CTP), Minister of Agriculture and Natural Resources; Elsewhere Erhurman said “The leading principle that we have all agreed upon is that we shall In the meantime, CTP Famagusta deputy crack down on all illegal and irregular practic- Teberruken Ulucay has been elected as the

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speaker of the parliament while Zorlu Tore from and six months in prison. Judge Tacan Reynar the main opposition UBP has been elected as who was presiding over the case found all of the deputy speaker. the six accused guilty of the charges of unlawful assembly, rioting, causing damage to property The government received the vote of confi- and inflicting intentional harm. The six men dence on February 15. While 27 deputies voted were part of a group of demonstrators who in favour of the new government, 22 deputies attacked the Afrika newspaper’s office on Janu- voted against it. One MP did not attend the ses- ary 22 after the daily linked Turkey’s Afrin oper- sion. According to the constitution, no party or ation in northern Syria to Ankara’s presence in group of deputies can table a motion of no con- the northern part of Cyprus. Protesters threw fidence for the first three months after a vote of rocks and eggs at the building smashing win- confidence is secured. dows and brought the newspaper’s sign down Erhurman received the chairman and the board causing significant damage. of directors of the Turkish Cypriot Chamber of Labour Relations and Trade Unions Commerce (KTTO). Speaking during the visit, the KTTO chairman Turgay Deniz expressed his The newly appointed Minister of Labour and happiness over the courage shown by the four Social Security Zeki Celer held his first meeting political parties to establish a coalition and with a delegation from the Association of Work expressed their belief that the coalition gov- Place Safety and Health Experts. Celer described ernment would be successful. Stating that the fatal accidents at work sites as murders and said government program had 90-95% overlapped that failure to prevent these accidents was a with the demands of the chamber, he said they growing source of concern for the Turkish fully supported the implementation of the gov- Cypriot community. ernment protocol adding that the chamber was ready to do everything it could to this end. Stat- Accidents in the workplace were also taken up ing that the government would be result ori- at an emergency meeting held at the Ministry ented, the Premier said “one of the characteris- of Labor and Social Security. An emergency tics of this government is that it has put the crisis desk was set up at the meeting attended economy in the centre of all its policies” and by the Minister of Labor and Social Security, stressed that it was not possible to secure Celer, as well as sector representatives. communal liberation without economy. Speaking during the meeting, Celer said that to The six men charged for the attacks last month prevent work related accidents precautions and against Afrika newspaper and the parliament measures had to be taken in line with the law. building have been sentenced to between two According to decisions taken at the end of the

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meeting, following inspections by inspectors  from the Department of Labour, all work at con- struction sites where the health and safety of Friday 16th March 2018, 09:00 workers are not ensured will be indefinitely halted. A committee will also be established CYPRUS-INSTITUTE UNIVERSITY MÜNSTER / with the aim of solving problems associated University of Nicosia / FES Conference with health and safety at work places.

When the Cemetery Becomes Political. Dealing With the Religious Heritage in Cyprus and its Neighbouring Countries 5. FES Cyprus Events Home for Cooperation (in the UN Buffer-Zone), March 2018 Nicosia

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FES CYPRUS NEWSLETTER Nr. 69 / February 2018

April Imprint:

Friedrich-Ebert-Stiftung (FES) Office Cyprus Thursday, 12th April 2018, 5pm – 7pm 20, Stasandrou, Apt. 401 Civil Society Advocates / FES / KEPLI CY 1060 Nicosia Presentation Tel. +357 22 377 336 New Law on Associations and Foundations Email: [email protected] Web-Seite:www.fescyprus.org KEPLI, Grigori Afxentiou 27 Facebook: www.facebook.com/FEScyprus Larnaca, Cyprus Twitter : @FESCyprus

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