IT WOULD be “very difficult” to link the European regulation on direct trade between the Turkish Cypriots and the EU with that on financial assistance, according to Foreign Minister George Iacovou.
Iacovou told reporters yesterday it would be “very difficult” to approve both regulations at next Monday’s meeting of EU foreign ministers, since direct trade had not even been discussed at COREPER level, that is, the committee of member state permanent representatives to the EU in Brussels.
COREPER informally agreed to pass the financial assistance package last week, earmarking 259 million euros in aid to the Turkish Cypriots, after the Cyprus government gave its final approval to the text changes in the regulation. The government said it was concerned to protect the property rights of Greek Cypriots in light of development projects in the north.
But the British delegation and Turkish Cypriot leadership are eager to have formal approval of the regulation linked with that of direct trade, which they argue is essential to lift the isolation of the north and give a boost to its lagging economy.
The Cyprus government is reluctant to allow direct trade because it involves the legal opening and running of the airport and ports in the north. It hopes to delay any discussion on the contentious issue until intra-island trade is functioning properly between the two sides. That way the Turkish Cypriots could export their goods through the legitimate ports of Cyprus, it hopes to prove.
According to reports, the Turkish Cypriot authorities have threatened to refuse the 259 million euro aid package if the EU does not approve both regulations together.
Direct trade had not been discussed at all at COREPER level, said Iacovou, adding that only the legal basis of the regulation had been discussed.
He highlighted the opposing views of the Commission and Legal Service of the European Council regarding the legal basis. The latter recently mirrored the opinion of the Cyprus government, that direct trade based on Article 133 regarding trade with third countries was incompatible with trade between the north and EU.
“I have the impression that discussion of the second regulation will continue on Thursday, but only on its legal basis. Subsequently, I cannot see there being an agreement on Thursday, so that the regulation could be submitted by Monday to the General Affairs and External Relations Council.
The minister rejected rumours that a special committee would be set up to discuss Turkish Cypriot affairs, stating that it had already become practice for those issues to be discussed in COREPER and then the Council of Foreign Ministers.
