After a difficult two years, Nicosia has not only managed to achieve some equilibrium in the diplomatic game being played out over the Cyprus issue, but to do so in a manner that suits its own purposes. As a result, Cypriot President Tassos Papadopoulos’s meetings in Athens this week were much easier than expected, with both sides reaching real agreement on the next course of action. However, those in the know are aware that the agreement expressed in official statements does not in fact exist. Although it did not appear to disagree, the Karamanlis government believes that the Cypriot president is pushing harder than it would like. That difference of opinion was more apparent previously when pressure was at a peak. Now it is harder to discern, and is only evident as something indefinable in the atmosphere. According to reliable sources, Papadopoulos was pleased with his meeting with his Greek counterpart Karolos Papoulias, an experienced diplomat who did not waste words on the well-tried stereotypical statements regarding support from Greece. Papadopoulos was presented with specific views on matters of substance that confirmed an agreement of views regarding strategy. The Cypriot president’s meeting with Prime Minister Costas Karamanlis went equally well, with the Greek leader apparently willing to play an active role in the newly positive diplomatic environment. Also interesting were his talks with new Foreign Minister Dora Bakoyannis, who not only agreed with him but made an effort to break the ice. According to well-informed sources, her interlocutor responded positively, but with some reservations. Obviously he is waiting for her next step. Bakoyannis is due to go to Nicosia in April. Change of climate No doubt the two events that changed the climate on the Cyprus issue were the joint communique issued after Papadopoulos’s meeting with UN Secretary-General Kofi Annan and the European Union’s approval of the funding regulations for the Turkish Cypriots. On February 27, the EU member states moved to free 139 million euros in aid to Turkish Cypriots (on the condition that it would not be invested in property owned by Greek Cypriots). It was agreed to discuss the controversial regulation on direct trade between the EU and the Turkish-occupied north of Cyprus separately. That development put paid to the argument that the Greek Cypriots were trying to isolate the Turkish Cypriots and stifle their economy. In fact, Nicosia was in favor of approving the funding regulation. The obstacle had been the fact that since June 2004 Ankara and its supporters within the EU had managed to link this regulation with that on direct trade, which if implemented would have led to an indirect recognition of the Turkish-Cypriot regime. Turkey and its supporters tried to exploit the climate in their favor, given the favorable mood then prevailing in Europe (due to their overwhelming vote of approval in the April 2004 referendum on the UN secretary-general’s proposal), in order to create a political fait accompli. However, the intense pressure being brought to bear by Washington and many EU member states fell on deaf ears. Nicosia dug in its heels while putting forward constructive proposals as to how to end the stalemate. It raised three conditions for the approval of the controversial regulation: – that trade with the occupied territory be carried out solely through the port of Famagusta, co-directed by the Greek-Cypriot authorities and the Turkish Cypriots under EU supervision. – that the fenced off no-man’s land around Famagusta (Varosha), be returned to its Greek-Cypriot owners. – that the sale and exploitation of Greek-Cypriot property in the occupied zone cease. Austrian presidency Austria, which currently holds the rotating EU presidency, has played a decisive role in bringing about the recent decision, which will bring the question of direct trade to the EU for debate on a basis that is similar to proposals made by Nicosia, which of course still retains the right of veto. Turkish Foreign Minister Abdullah Gul tried to avert the separation of the two regulations but failed. Even Britain agreed, so as not to be isolated. Gul’s effort to have the regulation on trade «kept on the negotiation table without any conditions» also failed – that is, for the references for a debate on the status of Famagusta and the cessation of the exploitation of Greek-Cypriot property in the occupied zone to be removed. The question of the return of Varosha is seen as preliminary to and not as part of the solution, as the Turkish side would like. European Commissioner for Enlargement Olli Rehn was the only one to oppose putting the issue on a new basis and stands by the position formulated in June 2004 for direct trade without conditions, as Ankara and the Turkish-Cypriot regime wanted. So this important development was significant for Papadopoulos’s meeting with UN Secretary-General Kofi Annan in Paris. The joint communique issued afterward reflected Nicosia’s goals to a great degree, perhaps influenced by the fact that Annan is stepping down at the end of the year and therefore feels less vulnerable to US pressure. Not only is the mediation process still in place but Nicosia’s view that the groundwork should be properly laid by technical committees has also been accepted. These committees will also discuss the implementation of confidence-building measures, such as the further withdrawal of military forces from the Green Line, the removal of mines and the complete demilitarization of the island. If progress is made, UN Undersecretary-General Ibrahim Gambari will go to Cyprus for the purpose of getting intercommunal talks again off the ground.