Greek Cypriots could now be forced round the table with their Turkish counterparts to discuss unification, thanks to the bailout
So far, discussions of the crisis in Cyprus have focused almost exclusively on the Greek half of the island, seemingly ignoring the historical division of the island. Yet as Greek Cypriots were negotiating the painful terms of a bailout agreement, Turkey issued a warning that any gas exploration in the sea waters around Cyprus should be undertaken by both Greek Cypriot and Turkish Cypriot communities. It also called for fresh negotiations on the resolution of the Cyprus issue. What if the crisis could provide an unexpected opportunity to resolve this longstanding dispute?
Tensions between the ethnic groups on the island have been simmering beneath the surface since the end of British colonial rule in 1960. Ongoing conflict and the Turkish invasion/intervention in 1974 led to the division of the island into two zones: the Republic of Cyprus, now controlled by the Greek Cypriots in the south; and the Turkish Cypriots in the north, under their secessionist state, which extensively relies on Turkey's support. Efforts to reunify the island under one federal state have repeatedly failed, including the last UN resolution attempt (the so-called "Annan plan") in 2004. After this, Cyprus joined the European family as a whole island – in practice, however, it tends to be represented by the Greek Cypriots. New negotiations between the two communities were frozen last year.
The dramatic changes that the economic crisis in southern Cyprus brings to the island could create new momentum for the resolution of the dispute. As Greek Cypriots try to "reboot" their economy, gas exploration in the sea waters around the island will gain importance as a potential source of economic recovery. Doing so without taking the Cyprus issue into account will be difficult. In fact, Turkey has already reiterated that both Cypriot communities should benefit from any gas reserves. The recent thawing of relations between Turkey and Israel (Cyprus's perceived "ally" in efforts for gas exploration) could further complicate things for Greek Cypriots.
And there are more strong arguments for improving relations between the north and the south at this point in time. Reunification would finally allow both sides to cut their bloated defence budgets and provide new economic opportunities in the east. Interestingly, Turkey's statement also suggested that "economic problems can be overcome … by creating an atmosphere of peace, reconciliation and co-operation in the island". These words reflect a departure from Ankara's recent inflexibility, which led the country to freeze relations with Brussels during the Cypriot presidency of the EU in 2012. Nicos Anastasiades, the new Greek-Cypriot president, openly supported reunification in 2004 and is seen as a leader who favours resolution.
After years of diplomatic gridlock, Cypriots from both sides will be slow to get their hopes up. But the economic crisis could prove a new, unexpected factor in the calculation and lead Greek Cypriots to positively respond to Turkey's call for negotiations. The following months and years will test the importance of the economy for the Cyprus issue, but also the willingness of all parts of the dispute to make a difference in Cyprus beyond economics.
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