The Cypriot government could neither have predicted the way that Cyprus was treated by its European partners, nor the unprecedented decision of the Eurogroup to impose a haircut on deposits, said Minister of Foreign Affairs Ioannis Kasoulides in a speech at the Houses of Parliament on Wednesday evening.

Speaking to an audience of MP’s, members of the House of Lords and UK Cypriot dignitaries Kasoulides noted that “this treatment of a fellow EU partner, which can hardly be described as solidarity, has left us with a feeling of disappointment and bitterness.”

He added that the economic difficulties of Cyprus have unfortunately and unexpectedly been seen as an opportunity to answer the long-standing question about the banks that are ‘too big to fail’. “Cyprus was the perfect candidate to put new ideas to the test. It represents only a small percentage of the EU economy and, as it was supported by some, a possible collapse of its economy would be a non-systemic event. So, instead of being treated as an EU partner, Cyprus became an economic guinea pig,” said the minister.

He recognised that Cyprus needed to act much earlier in dealing with the deteriorating economy by introducing fiscal consolidation measures. However, he criticised the “shock treatment that had to be decided upon and implemented overnight” as well as the presentation of the bail in as the saviour of EU taxpayers and a rightful and deserving punishment for the reckless behaviour of banks. “What we forget or intentionally disregard is that this solution also affects real people,” demurred Kasoulides.

He expressed his confidence that yet again, as in 1974 following the Turkish invasion, the resilient and hardworking Cypriot people will overcome these harsh difficulties facing them. Kasoulides added that the government’s focus is to rethink the country’s economic model.

Turning his attention to recent queries by members of both Houses of Parliament in Westminster about possible UK stakes on the mineral wealth and the Continental Shelf of the bases areas, the Cypriot Foreign Minister reminded that the Treaty of Establishment determines that the bases are to be used solely for military purposes. He referred to a very recent statement by Baroness Warsi in the House of Lords, which was very clear on the finality of such presence. “Given the specific nature of the rights exercised by the UK in the base areas, only issues pertaining to such use, for instance unrestricted access, are relevant to their status, with the exclusion of issues pertaining to sovereign rights of the Republic of Cyprus over its Exclusive Economic Zone and its Continental Shelf, in accordance with the Law of the Sea,” said Kasoulides.

He commented that in most of the cases of relevant Parliamentary Questions the positions of the UK government are in line with those of the government of Cyprus, since both are based on commonly accepted principles: “Firstly, the British bases in Cyprus can be used solely for military purposes, and secondly, the mineral resources/wealth, both on the land and in the surrounding waters belong to the Republic of Cyprus. It goes without saying that, if and when, we need to exploit mineral resources in the territory of the Bases, this will be done by the authorities of the Republic, in accordance with the relevant provisions of the Treaty of Establishment.”

The Foreign Minister also took the opportunity to express understanding for the difficulties that British residents in Cyprus face with regards to real estate title deeds. As he said, many Cypriots face the same problem too and to this end, the government aims to introduce a speedy and fast track system to assist foreign nationals wishing to invest in real estate.

The last part of the minister’s speech was dedicated to foreign policy matters, especially regarding the Cyprus issue. Adding to his affirmation that there is absolute legal certainty about the international status of the Republic of Cyprus and its government, as the sole and only legal government on the island, irrespective of what Turkey may say or claim, Kasoulides said that while Nicosia desires a swift resumption of talks, the need to urgently address the economic issues does not allow an immediate new round of negotiations.

Nevertheless, Kasoulides pointed to two elements that need to be explored before the resumption of negotiations describing them as of paramount importance. “The first element is that the negotiations must be well prepared in advance. The talks so far did not yield any tangible results and the ‘Cypriot ownership’ framework has failed to reach a positive outcome. It is, therefore, necessary to consider carefully how the new process will be structured. The second element relates to the need to cultivate a positive climate before and during the negotiations,” explained the Foreign Minister.

Regarding the preparation of the negotiations, he said that he firmly believe they should be carried on at different levels with the participation of special representatives from the two communities. “Their status should allow them to consult with Ankara. We should recognize that not everything is depended solely on the two communities,” he told his audience, adding that in order to be more effective and achieve tangible results there needs to be a new methodology of talks, one that will be based on cross-chapter negotiations.

Commenting on his Turkish counterpart’s claims that the election of a new President in Cyprus creates a window of opportunity for the solution of the problem, Ioannis Kasoulides said that this could happen not through theoretic and rhetoric statements, but through concrete actions. “That is why Turkey, just like Cyprus, needs to be ready to send positive, concrete signals and to reciprocate specific gestures of goodwill. Unfortunately, the Turkish government is clearly showing that it is trying to take advantage of the economic situation in Cyprus for short-term political benefit,” Kasoulides said. He added that the Cypriot government will not allow the imposition of unacceptable terms for a settlement through efforts to take advantage of the financial difficulties on the island. He also expressed his hope for a constructive UK stance on the bi-yearly SG Report on the UN Operation in Cyprus, as well as on the adoption of the next UNSC Resolution.

Kasoulides concluded by referring to the energy prospects of Cyprus and reiterating that decisions and actions of the Republic of Cyprus to explore and exploit its natural resources within its Exclusive Economic Zone fall within its sovereign rights and are in full conformity with international law, despite angry verbal assault at the highest levels by Turkish leaders. “These natural resources, including hydrocarbons, belong to the only state in Cyprus, the Republic of Cyprus. They also belong to the Cypriot people as a whole. With the solution of the Cyprus problem, these natural resources will remain the ownership of the state, of the people and of the two communities. It is the right and the responsibility of the Government of Cyprus to manage these natural resources, for the benefit of all Cypriots,” added Kasoulides.