A World of Broken Promises > Foreign and Commonwealth Affairs
Response of the Secretary of State for Foreign and Commonwealth Affairs to the Second Report of the Foreign Affairs Committee on Cyprus, April 2005:
" …3. We agree with the Committee's assessment that intra-island trade has the potential to increase the prosperity of Greek Cypriots and Turkish Cypriots alike. The Government has continued to push for improvements to the Green Line Regulation. Since the Committee's report was written, the Commission and the Republic of Cyprus have agreed on modest improvements to the Green Line Regulation, including inter alia a significant increase in the value of personal goods that may be brought across the line. These amendments entered into force on 26 February. In agreeing to these amendments, the UK Government noted that they were still limited and we would like the scope of the regulation extended still further to enhance trade. We welcome all moves towards increasing intra-island trade and economic interaction between Greek Cypriots and Turkish Cypriots. We note the Committee's disappointment that goods cannot currently move from south to north. The Turkish Cypriots have recently announced that they will permit trade from south to north - we welcome this and will encourage the Turkish Cypriot administration to implement these new measures without delay. The Committee's report notes that the Republic of Cyprus does not currently recognise Turkish Cypriot commercial driving licences, with the consequence that few Turkish Cypriot truck drivers can drive across the line. We will continue to encourage the Republic of Cyprus to lift this restriction…
4. We agree with the Committee's assessment that EU financial aid to northern Cyprus will help the Turkish Cypriots prepare for integration into the EU. We regret that it was not possible to reach agreement on this aid regulation amongst EU Member states in November. Since that time, the Presidency has not reintroduced the matter for discussion. We agree with the Committee's recommendation and will take forward consultations with the Presidency, Commission and Member States on achieving EU agreement on the regulation. At the same time, we would reiterate, as Dr MacShane made clear in his evidence to the Committee, that we believe that aid should be disbursed directly in the north of Cyprus. We also continue to believe that the aid regulation should be treated as a package in conjunction with the Commission's proposed draft regulation to facilitate direct trade between the EU and north Cyprus. We believe these regulations are complementary, and need to be considered together if they are to fulfil the mandate EU Ministers gave to the Commission in April 2004 on ending the economic isolation of the Turkish Cypriots...
5. We agree with the Committee's conclusion, and with the Committee's observation that the consequences of failure to agree on the Commission's proposals would be to consign the Turkish Cypriots to continuing economic isolation and to place prosolution Turkish Cypriot politicians under possibly unbearable strain. We also agree with the observation that direct trade and contact with the rest of Europe will provide Turkish Cypriots with additional incentive to seek an overall solution to the Cyprus problem. We believe that a direct trading relationship between the EU and the north of Cyprus would help narrow the economic gap between north and south, thus leading to increased opportunities for economic cooperation and business ventures between the two communities. It would improve the climate for foreign direct investment in the north, and would provide the incentive to harmonise with the acquis in key areas and improve the infrastructure in the north. In this context, we recall that the EU's approach to trade with Cyprus has traditionally sought to ensure that trade is for the benefit of both sides. Prior to Cyprus' EU accession, the EU's Association Agreement and Customs Union with Cyprus were negotiated on this basis. The issue of direct trade has not been reintroduced for discussion amongst EU Member States since November. But we will continue to consult with the Luxembourg Presidency, Commission and EU Member States on this issue. We believe that the absence of direct trade poses a greater threat to the reunification of Cyprus. Our support for direct trade in no way undermines our long-standing position on non-recognition…
6. We continue to believe that direct flights between the UK and north Cyprus would contribute materially to ending the isolation of the Turkish Cypriots and would contribute to the prospects for reunification. It therefore remains our position that we would in principle support the commencement of direct flights to northern Cyprus…."
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