Aris Petasis,

Vice Chairman, Board of Trustees, International Fund, Moscow State Aviation cceia

In his article “The Cyprus Problem in 2004:  Three Differences from 2004 and One Similarity” appearing in the September, 2013 issue of In Depth Rector Attalides of the cceia of Nicosia writes, “In 2004 one of the issues impeding a solution was that the economically overconfident Greek Cypriot community was convinced by its leaders (my italics) that a solution would mean that it would need to subsidize the poorer Turkish Cypriots.”  The fact is that the Greek Cypriot (GC) community was unconvinced by the position taken by its leaders and in fact gave the leadership a slap in the face through the ballot box.  Nearly all the political elite of the GC community took a pro-Annan Plan position.  Those that came out against the Plan were basically the then President of Cyprus and part of the Holy Synod.  Three former Prime Ministers of Greece came out vociferously in support of the Plan and the then serving Prime Minister of Greece spoke in two tongues; in the end he supported the plan just as so many others in the hierarchy of Greek parties.  In Cyprus: two former presidents, the leadership of the two major parties (then accounting for nearly 70% of the electorate) came out strongly in favour of the plan. So, I can’t agree that “….the Greek Cypriot community was convinced by its leaders….”  In fact, GC voters ignored their leaders and applied their own better judgment and survival instincts to massively reject the Plan because it spelled disaster for them, their families and their country.   

Amongst other things Rector Attalides says, more or less, that the GC were worried of making an economic loss out of the proposed solution and decided to reject it on grounds of self-interest.   I would agree with Rector Attalides that economic advantage and self-interest are strong drivers in the decision making process.  At the same time I would postulate that survival of self, family and country are by far more potent forces and pale economic advantage into insignificance.   Even if all else is isolated from the Annan Plan (gross violation of human rights, etc) leaving economics as the sole decision factor I would say that the GC did the smart thing to reject the Plan en masse on economic grounds.  The Annan plan and other similar plans that design the economy to operate on the platform of bi-communality, bi-zonality, etc are inherently catastrophic and even the unsophisticated voter appreciated this in 2004. Naturally when a country (small at that) is divided on ethnic grounds and is expected to have in place three different (and unnecessary) government structures the country starts to stare economic calamity in the face.  Cyprus is a small country with a small population and all it needs is a simple, flexible, efficient and unifying system that will work for the interests of its entire population at low cost.  From an economic point of view the structure proposed by the Annan Plan is a nightmare and has in it all the ingredients of self-explosion.  Any organisational design expert would, without hesitation, reject such a plan as amateurish and conceived by people with ulterior political aims in mind rather than workability and efficiency. 

Note was taken of Rector Attalides’ reference to the position taken by a “pro-solution (italics mine) paper” on the positive effects that a solution (Annan type) would have on the economy: primarily because of expected construction activity in Varoshia, Morphou, etc.  I submit:

a) that the term “pro-solution” is unkind to the 76% of the people that massively voted “No” to a solution based on the Annan Plan.   I believe that all papers and all Cypriots are pro solution because this is in their interest, that of their families and their country.  I respectfully suggest replacing “pro-solution paper” with “pro-Annansolution paper” or, in the extreme, with “pro-anysolution paper.”  Cyprus does not have pro and anti solution citizens.  The lines are drawn between those that refuse to accept violation of their human rights and refuse to live under the suzerainty (see: guarantor powers, right to invade Cyprus, etc) of their current occupiers and those, to put it mildly, that…. think differently,

b) as regards a possible up-turn in construction I would agree that even a calamitous solution could in the short-term propel some (or much) construction activity in the Varoshia (note Varoshia and not Ammochostos) area or Morphou, etc.  The destructive effects of a bad solution will probably not manifest themselves immediately.  It may take a few months or even a few years before a bad agreement begins to unravel by virtue of the fact that it is unworkable and undemocratic.   


Democratic structures are central to the economic vibrancy of any country.  Undemocratic plans such as the Annan plan end up destroying economies largely because they operate on ethnicity, racism and prejudice rather than on unity, across-the-board respect for every individual and reward on merit (as opposed to reward on race, gender, color, etc.)  The Annan plan is: programmed to create economic instability (killing economic revival), continuous political instability («guarantor” powers, Cyprus open to new invasion,) financial profligacy (two employees per position to ensure G/C-T/C parity,) three governments (a central government that would quickly be ignored, a feeble GC government and a subservient TC government,) chaotic governance (no flexibility: agreement between GC and TC needed on every major decision,) separate majorities, communal explosiveness (and not only) on account of continuous violation of human rights, etc. Add to the above the corruption that is bound to emerge from the muddle of a non-existent (for all practical purposes) central government.

In conclusion: forgetting the widespread violation of human rights in the Plan and assessing the Annan plan strictly from an economic vantage point the Plan ought to be rejected outright next time round.  The Annan Plan puts together all the destructive forces that are certain to ruin Cyprus’ economy.  Thus, a bi-communal, bi-zonal federation with the right of Turkey to invade Cyprus once again is clearly no option.   


Switzerland, Finland, Germany, Sweden, etc that head the economic Competitiveness Index of the World Economic Forum have two things in common:  a) all are advanced democracies and b) each of these countries  would go to war to block the imposition of an Annan Plan on their economies!

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