2012 Cyprus A Political Economy of Divi PDF

Beyond a Divided Cyprus
A State and Society in Transformation
Edited by Nicos Trimikliniotis and Umut Bozkurt

beyond a divided cyprus
Copyright © Nicos Trimikliniotis and Umut Bozkurt, 2012.
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Library of Congress Cataloging-in-Publication Data
Beyond a divided Cyprus : a state and society in transformation /

edited by Nicos Trimikliniotis and Umut Bozkurt.
pages cm
1. Cyprus—Foreign relations—1960– 2. Cyprus—Ethnic
relations—Political aspects. 3. Cyprus—Politics and
government. I. Trimikliniotis, Nicos, editor of compilation.
II. Bozkurt, Umut, 1976– editor of compilation.
DS54.55.B49 2012
956.9304—dc23 2012016917
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Chapter 12
A Political Economy
of Division,
Development, and
Crisis: Envisioning
Reunification Beyond
the Cyprus Economic
Miracle
Nicos Trimikliniotis, Elias
Ioakimoglou, and Panayiotis
Pantelides
All that is solid melts into air, all that is holy is profaned.
Marx and Engels, Communist Manifesto (1848)
Introduction: A Political Economy Perspective

from the Current Crisis
This chapter examines three interrelated aspects: First, it offers an eco-
nomic overview of the two parts of the country, which are de facto
structurally divided, but also connected via some elements of interde-
pendence. Secondly, it examines from the point of view of the current
economic crisis in the Eurozone the basic features of the post-1974
economic development in Cyprus, focusing mostly on the last decade,
which illustrates the end of an accumulation regime in what was seen
218 N . T R I M I K L I N I O T I S , E . I O A K I M O G L O U , AND P. P A N T E L I D E S
as the “Cyprus economic miracle.” The economically stronger Republic

of Cyprus (RoC) in the south went from slowdown to crisis, while the
smaller economy of the Turkish Republic of Northern Cyprus (TRNC),
heavily dependent on and recognized only by Turkey in the north, is in
a deeper economic and social crisis. Reunification requires that the two
parts of the country, economy, and society be reunited; critical research
agendas ought to reflect the need to reorient economics toward an inte-
grated economics of reunification. Finally, this chapter envisions a path
toward sustainable reunification, realizable in the days of economic cri-
sis on new forms of “development.” The current economic crisis makes
mainstream approaches to private-led financing and neoliberal-inspired
development increasingly untenable. Learning from the past and enrich-
ing knowledge from global experience, we propose innovative forms
combining sustainable, democratic, and popularly controlled state-led
and cooperative development.1
Economic Overview: A Divided Economy

and Interdependence
Examining the economy and society of the small island of Cyprus, one
is struck by three crucial features: first, the RoC as a “border society”
(Panayiotou, 1999) is well integrated in the regional economic system; in
this sense it is also a border economy, operating as a bridge and a hub in
the eastern Mediterranean. It is an open southern European economy to
the West as a European Union (EU) member since 2004, which is con-
nected to northeast Africa, the Middle East, and Asia, drawing on the
labor reserves, tourism, and financial services exporting from its neigh-
bors. It is listed as one of the high-income island economies, which are
off-shore financial centers with associated tourism (Bertram and Poirine,
2007, pp. 358–359).
The second feature is the paradox of the de facto divide, which
generates multiple “states of exception” and contradictions in what is
described as a “non-border” of the EU2 tearing the country apart. The
so-called “Green Line” as the buffer zone is but a cease-fire line since
1974, patrolled by one of the longest UN-stationed peace-keeping forces,
United Nations Force in Cyprus (UNFCYP), which is in the country
since 1964. This situation is even today, after the end of the Cold War,
considered by all interested actors to be unsustainable and unacceptable
and may threaten the stability of the southern flank of North Atlantic
Treaty Organization (NATO) and the wider region. The situation is
simultaneously perceived as a “deluxe partition,” a typical example of a
lack of “hearting stalemate,” a comfortable situation in the absence of a
E N V I S I O N I N G RE U N I F I C AT I O N 219
settlement.3 Yet there is a “mini Cold War” in what the UN described

as one of the world’s most militarized zones. In this multiplicity of para-
doxes, the study of the growing economic interdependence4 as well as the
various initiatives from trade unions, teachers, and activists in the Buffer
Zone groups (Trimikliniotis et al, 2012) are worthwhile projects, which
counter the overall disappointing picture in the cause for reunification.
The third important feature is the centrality of migrant labor,
which makes the country comparable to the southern European and
Mediterranean island economies (see Trimikliniotis, 2001; Thompson,
2006 and Mainwaring, 2008). On both sides of the barbed wire, pre-
carious migrant labor is a crucial feature in the accumulation regimes and
the developmental models, which is radically affecting economic develop-
ment and society at large (Trimikliniotis, 2010c, 2010d; 2011a; Kurtuluş
and Purkis, 2012). There are similarities in terms of the exploitation pat-
terns for instance; however, there are crucial differences in the regulation
and market operation of the migratory system, but this is beyond the
scope of this chapter.
Asymmetrical and de facto Divided Economies Compared:

Measuring the Elements of Interdependence
The two sides are asymmetrical in different ways; also, they do not
recognize each other as legitimate states, even though the RoC is the inter-
nationally recognized state and an EU member. The prosperous south has
a population of just over 800,000, whilst the population issue in the not
so prosperous north is a hot political issue: estimates vary from 220,000
to 230,000 (Faiz, 2008, p. 134); some even put the figures as high as
500,0005 depending on their perspective and method of estimation.
The RoC has a gross domestic product (GDP) of US$25 billion and
an estimated GDP per capita of US$30.003. The principal export desti-
nations are Greece, Germany, and the United Kingdom, while the main
import sources are Greece, Italy, and Germany. In the immediate after-
math of the 1974 disastrous war, there was massive economic growth
up to 1990s. Since EU accession in 2004 right up to the beginning
of the crisis in 2008, the average growth rate was 3.7 percent per year.
Following a period of rapid economic growth from 2002 to 2007, the
economy has been in recession from 2009 onward. The RoC joined the
Eurozone on January 01, 2008. After the 2009 recession there was a slow
turnaround in 2010, but in 2011 there was negative economic growth as
the RoC is sinking deeper into the crisis of the Eurozone via its connec-
tion to Greece. The situation deteriorated with the loss of the country’s
main power station after a major explosion of confiscated munitions at
the Florakis naval base on July 11 (see the introductory chapter in this
volume). Since then, rating agencies have been downgrading the RoC
economy credit capacity to Baa1 and a reduced growth forecast from
1.5 to 0.5 percent in 2011. Matters took a further downturn with the
Greek “haircut” which affected the two largest banks, which announced
major losses of about 4 billion Euros, a huge amount as it amounts to
23 percent of the country’s GDP. Under EU and opposition pressure, the
Government introduced economic austerity measures and public deficit
cuts to avoid an EU bailout; however, as the revenues from tourism and
property sales are dropping and unemployment is rising, these measures
are further deflating the economy. Unemployment rose to 9.6 percent in
January 2012, the highest ever recorded.
The economy in the northern part of the country is much smaller
and more narrowly based than the south. Economic growth tends to
be erratic given the relative isolation, a large public sector subsidized by
Ankara, reliance on the Turkish Lira, and a small market size. Agricul-
ture and services together employ more than half of the workforce. Per
capita incomes in the north are, on average, about half of those in the
south. GDP is estimated to be around US$1.5 billion. The unrecognized
regime in the north is heavily dependent on Turkey (credits, grants, subsi-
dies, and trade), Turkish cheap labor and settlers and 35,000 army troops.
It has no effective control over monetary policy as the currency is the
Turkish Lira, leaving the economy vulnerable to currency shocks from
Turkey and imports Turkish inflation. Very few revenues are gained by
exports, mostly with Turkey, and limited trade with the EU6 and other
markets. During the period of 1977–2008, the average rate of growth
was 4.7 percent and per capita income has reached US$16,158 in 2008
against US$1,444 in 1977 (Güryay, 2011). The public sector relies on fis-
cal transfers from Turkey, and the rapid growth between 2003 and 2006
was sustained by real estate and construction, which subsided since 2007,
pushing the economy into recession since then (Oguz, 2008; Güryay,
2011). Apart from real estate and construction, the other major sectors
are tertiary education services, tourism, and gambling and related ser-
vices. The decline in real estate, which is manifested in a virtual stand-still
of small-scale construction, is thought to be due to legal developments
regarding Greek-Cypriot properties. In 2008, the economy in the north
entered a recession. In 2010, Ankara decided to drastically reduce grant
funding and the authorities imposed stringent austerity measures. This
plunged the economy into further recession; together with the failure
to find a solution to the Cyprus problem and the inflow of popula-
tion from Turkey, the economic crisis precipitated social and political
Table 12.1 Basic features of Cyprus economy for 2008
Population 1,071,300 GCCa 74.4 percent TCCb 25.6 percent

Employment 70,300 GCC 80.6 percent TCC 19.4 percent
Activity rate 43.9 percent GCC 47.5 percent TCC 33.2 percent
Unemployment rate 5.2 percent GCC 3.8 percent TCC 10.8 percent
GDP ¤19,913 million GCC 87 percent TCC 13 percent
GDP per capita ¤18,588 GCC 116 percent TCC 52 percent
Productivity ¤42,341 GCC ¤45,341 TCC ¤29,215
Exports ¤1,247 million GCC ¤1,190 million TCC ¤57 million
Current Account −16.6 percent GCC −18 percent TCC –10 percent
Deficit
Inflation GCC 4.7 percent TCC 14.5 percent
Exchange reserves ¤1,931 million GCC ¤717 million TCC ¤1214
Source: Economic Interdependence in Cyprus, Main findings and recommendations,

http://www.undp-act.org/data/articles/interdependence_report_2011.pdf (accessed February 28, 2012).
a GCC, Greek-Cypriot community; b TCC, Turkish-Cypriot community.
discontent amongst trade unions and community groups leading to mass

mobilizations.
A recently published study on interdependence provides the basic fea-
tures of the economy in the north (Turkish-Cypriot community, TCC,)
and the south (Greek-Cypriot community, GCC) (table 12.1). The
following excerpt from the report is a good summary of the current
situation:
The population of the TCC forms 26 percent of that of Cyprus, but GDP
is only 13 percent. There is a clear disparity between the GCC and TCC
economies with TCC unemployment accounting for 41 percent of the total,
inflation being three times higher, exports less than 5 percent, and the TCC
activity rate only 33 percent. But the TCC exchange reserves are higher than
GCC, because the Eurozone has the effect of the whole currency being an
exchange reserve. TCC per capita income was 52 percent of that of the island,
but productivity was relatively higher at 69 percent.
Another aspect of the divide is that since 2003, there has been popu-
lar interaction between the two communities; this was not possible for
almost 30 years since the war of 1974. The opening of the checkpoints on
April 23, 2003, with the sudden decision of the authorities in the north,
abandoning the long-term opposition to Greek-Cypriot and Turkish-

Cypriot contacts, took everyone by surprise. This move was connected
to the massive and unprecedented Turkish-Cypriot demonstrations that
started in 20027 and opened up a radical potential as a result of the
crossings and mobilizations for further crossing of people from the two
communities (Trimikliniotis, 2003; Demetriou, 2007, 2006). It also
opened up a trade potential, which was immediately taken up by business.
With the accession of a divided RoC in the EU, the Green Line Regula-
tion8 came into force to regulate problems deriving from the de facto
partition of Cyprus.9 The EU also introduced the Financial Aid Regula-
tion (Hatay et al., 2008, pp. 9–14; Güryay, 2011, p. 97; Trimikliniotis,
2009). However, together with the positive and radical potential, there are
barriers, obstacles, and backlashes reported, which derive from the fears,
reactions, and prejudices reproduced by the fact that the Cyprus problem
is still unresolved (Trimikliniotis, 2003; Hatay et al., 2008; Trimikliniotis,
2009). This peculiar non-border or soft border of Cyprus/EU has inher-
ent complications resulting from the operation of policies, which aim to
combat illegal immigration of third country nationals from the north, to
detect and prevent any threat to public security and public policy, and
simultaneously encourage intercommunal trade.10 Nevertheless, trade
between the two sides continues to grow over time. The table below shows
development between two communities from 2003 to 2009 (table 12.2).
Since the opening of crossing points and the implementation of the
Green Line Regulation in 2004, the crossing of foreign tourists, Greek-
Cypriots to north, and Turkish-Cypriot to the south, the few hundreds
of Turkish-Cypriot working in the RoC-controlled area have gener-
ated trade (see Güryay, 2011, pp. 98–99; Economic Interdependence
Report, 2011):
• The economy in the north had gained ¤20.6 millionin 2003 but
this amount reached ¤118 million in 2009.
• There is an increase in Turkish-Cypriots working in the south; the
average number registered in the RoC social insurance scheme was
2500 workers in 2009 and their estimated income was ¤41.3 million
in 2009 compared to ¤13.2 million in 2003.
• There are 4,175 Turkish-Cypriots who maintain their social security
rights in the RoC and receive pensions of about ¤19.6 million.
• Green Line trade from north to south Cyprus began in August 2004,
and grew every year, reaching ¤7.1 million in 2008 but has decreased
to ¤6.0 million in 2009 because of recession in both sides. However,
in 2009, trade of Turkish-Cypriots fell sharply by almost 12 percent.
Table 12.2 Economic interdependence between Greek-Cypriots (GC) and Turkish-

Cypriots (TC) after 2003 and according to the Green Line regulation (million ¤)
2003 2004 2005 2006 2007 2008 2009
Benefit to
Turkish
Cypriots
Movement
Greek Cypriots 18.9 31.2 47.9 36.3 28.5 37.1 39.4
Tourists na 36.4 44.8 36.0 32.5 43.1 45.6
Others 0.7 1.9 na na 19.0 27.6 31.6
Car Insurance 1.0 1.4 1.5 1.1 1.5 1.2 1.4
Sub-Total 20.6 70.9 94.1 73.4 81.5 109.0 118.0
Labor Income 13.2 31.1 39.7 39.7 42.9 45.4 41.3
Green Line Trade na 0.5 1.3 3.2 4.2 7.2 6.0
TC Pensions 16.1 16.5 17.2 17.6 18.1 18.8 19.6
Public Health 2.5 5.1 4.3 4.0 4.8 4.4 7.0
Sub-Total 31.8 53.2 62.5 64.5 70.0 75.8 73.9
TOTAL 52.4 124.1 156.6 137.9 151.5 184.8 191.9
Benefit to Greek
Cypriots
Movement
Turkish Cypriots 17.3 36.5 47.1 56.5 97.7 120.6 102.4
Car Insurance 0.5 1.3 1.4 1.5 1.6 1.8 2.1
Sub Total 17.9 37.8 48.5 58.0 99.3 122.4 104.5
Green Line Trade 0.0 0.0 0.2 1.0 0.7 2.4 3.7
Private na 0.8 0.9 1.1 1.3 2.4 3.7
Education
Sub Total 0.0 0.8 1.1 2.1 2.0 4.8 7.4
TOTAL 17.9 38.6 49.6 60.1 101.3 126.2 109.0
TC + GC 70.3 162.7 206.2 198.0 252.8 311.0 300.9
Source: Economic Interdependence in Cyprus project supported by UNDP-ACT and USAID.

http://www.undp-act.org/data/articles/interdependence report 2011.pdf (accessed May 28, 2012).
• The total financial flows from south to north has increased from
¤52.4 million in 2003 to ¤191.9 million in 2009, and growth rate
of financial flows during that period was 266.2 percent.
• A financial flow from north to south Cyprus consisted of mainly
Turkish-Cypriot customers spending, who spent ¤17.3 million in
2003 and reached ¤102.4 million in 2009.The rate of increase in
spending during the period of 2003–2008 was 492 percent.
• Total volume of flows between the two sectors increased from
¤70.3 million in 2003 to ¤300.9 million in 2009. The rate of
increase in total flows during that period was 328 percent.
On first impression the overall volume of trade appears rather small: for
the RoC economy the above figures represent less that 1 percent, and
less than 5 percent of the Turkish-Cypriot economy. However, the overall
expenditure effect is far greater. If we add the health provisions offered
and the social aspects of interdependence, the effect is even larger: for
the Turkish-Cypriots dependence is much greater making the economy
of RoC second only to Turkey and the United Kingdom; for the RoC
we are referring to services to Cypriot citizens residing in the northern
part of the country, what the RoC considers to be occupied territo-
ries under the control of the TRNC.11 To understand this process one
must go beyond strict economic or economistic approaches: the inter-
action between Greek-Cypriots and Turkish-Cypriot across the barbed
wire is best perceived in terms of a socioeconomic and ultimately polit-
ical multiplier, which has the potential to enhance the economics of
interdependence, peace, and reconciliation and can be a drive towards
settlement.
In 2003 it was thought that there was no tendency for the two Cypriot
economies to converge on a common steady-state growth; it was estimated
that it would take 30 years for the north to cover half of the economic gap
with the southern economy (Demetriades, et al., 2003). However, Ayres
(2003) found that the macroeconomic impact on growth and employ-
ment is potentially positive and particularly for the economy of the north.
Also, between 2003 and 2006 the economy in the north converged from
30 to 52 percent with that of the south (Oguz, 2008). This gap has been
stagnant ever since.
Life after the “Economic Miracle”

The post-1974 development in areas under control of the RoC has been
depicted as an “economic miracle” (Christodoulou, 1992); and indeed
the growth rate in the post-1974 years, particularly in the early years
after the war up to the late 1980s, were remarkable. The exhaustion
of the model marks the end of a strategy of accumulation as the RoC
is nearing the limits of “development” and convergence with the coun-
tries in the Eurozone. To grasp the situation, one needs to historicize
the Cypriot economic development so as to draw out the key issues
that we consider as crucial as pointers for future economic development
in the light of a solution. The development of Cyprus can be peri-
odized according to the qualitative and quantitative characteristics, but
that is beyond the scope of this chapter (Trimikliniotis, 2001; Kattos,
1999).12
The 1974 war left the society and economy divided and devastated.
It was “a planners nightmare” (Matsis, 2011) as economic activity col-
lapsed by one-third, partly because of the withdrawal of Turkish Cypriots
and 47 percent reduction in gainful employment—from 253,000 in 1973
to 135,000 in 1975. Massive unemployment in 1974 was measured at
29.6 percent of the economically active population, as well as loss of pro-
ductive resources in all sectors, particularly heavy in tourism, agriculture,
mining, and transport in what was then a closely integrated economy.
The displacement of 160,000 Greek-Cypriots meant heavy dependence
of people on the state to provide means of subsistence. In contrast with
the conservative fiscal policies pursued from 1960 to 1973 characterized
by fiscal surpluses and very low government debt, the post-1974 policies
emphasized a radical change in fiscal policy, which became Keynesian,
expansionary with very high deficits financed from foreign borrowing.
The government pursued expansionary economic policies, implemented
large housing programs, provided incentives to the unemployed, and
expanded educational and health policies.
The dramatic economic growth in the 1980s and 1990s, referred to as
“the economic miracle,” was structured by a number of “external” factors
such as the Turkish occupation of the north since 1974 (Christodoulou,
1992). This fact, together with a concerted effort by the Government,
political parties, and trade unions, created the conditions for the eco-
nomic growth that was subsequently experienced in Cyprus, based on the
massive expansion of the model known as “mass tourism” (Anthias and
Ayres, 1983; Christodoulou, 1992; Panayiotopoulos, 1995, 1996). The
Greek-Cypriot “economic ethos” (Mavratsas, 1992), in Weberian terms
propelled accumulation, growth, and commerce, but was much premised
on the fact that land-ownership, commerce, and trade were dominated by
Greek-Cypriots.
Despite the socioeconomic transformations, up to 1974 the
postcolonial social class structure retained essentially the same pyramid of
wealth and income: the Church continued to be the largest land-owner
and expanded its commercial activities, whilst at the same time there was
a growth in the Greek-Cypriot commercial classes. An abrupt change
occurred in 1974: the Turkish military invasion and occupation of the
north and the mass expulsion of Greek-Cypriots in 1974, by default cre-
ated the preconditions for rapid (capitalistic) “modernization,” in what
Harvey (2003) refers to as conditions for “accumulation by disposses-
sion.” In spite of the severe drop in the GDP during 1973–1975 and
the sharp rise in unemployment and mass poverty, cheap labor was pro-
vided by the Greek-Cypriot displaced persons, forcibly expelled and living
in government refugee camps. The conditions of the rapid development
were reminiscent of the early industrialization of western Europe. This

fact together with a concerted effort by the government, political parties,
and trade unions created the conditions for the development that was
subsequently experienced in Cyprus.
The process of “tertiarization” continued undeterred during the 1980’s
and 1990’s, shaping a Cyprus as a “paradise-like destination”. De-
industrialization is setting in as the industrial output to GDP has dropped
from 18 percent in the early 1980s to less than 11 percent in the late
1990s. The signs of a slowdown began to show as the overdependence on
financial and service sectors made them more susceptible to fluctuations.
Panayiotopoulos (1995, 1996) refers to a postcolonial “developmen-
tal state,” which took the lead in development and encouraged private
investment. It is questionable whether there was ever a rational devel-
opmental state in Cyprus as such (see Trimikliniotis, 2001). Economic
growth continues after 2000 but certainly not at the same level—in
fact we have argued elsewhere that perhaps we are approaching the lim-
its of growth hitting on a technological frontier as the limitations of
the “mass tourism model” are becoming more apparent (Ioakimoglou,
et al., 2011). The dependence on tourism has receded from 22 percent
in 1990 to less than 10 percent in 2012. Nevertheless, the process of ter-
tiarization continues unabated as the service industry is dominating the
economy.
Crucial social transformations in a country are recorded in the form
of “urban adaptation” and urbanization, as analyzed by Attalides (1981).
We have a more complex situation, where there are two crucial elements,
dialectically united: (a) we have a new social spatiality, where the presence
of migrants has created a more international and multicultural Cypriot
public sphere and (b) an impoverished ghetto-like area, which is not
a ghetto as such. It is just poorer: we can say without hesitation that
in the millennium “urbanization is creating a ‘marginal class’ of recent
migrants”. Moreover, trends recorded as crucial transformations in the
stratification in early 1980s are vastly accelerated and new phenomena are
generated in the post-millennium Cypriot society toward the 2020s and
beyond. This new “urbanization” and the model of development are cer-
tainly shaping a new system of stratification in Cyprus, with a new lower
urban class, as well as a ruralization of the poors, i.e. a sustaining of rural
industries/agricultural unites and areas precisely due to the poor living
conditions of migrant workers in the areas abandoned by Cypriots, who
have migrated to the cities. We have the new urban poor as we have the
rural poor. Secondly, we have a long-term racialization process, as migrants
increasingly form the urban and rural poor. The majority of the working
class of manual labor is made up primarily of foreign migrant labor.
Moreover, the processes of tertiarization, the transformation of family

and employment together with globalization, have transformed the inner
part of the Cypriot home and the elements of what statistics refers to as
the “basic economic unit”, i.e. the “household.” This type of economic
activity is characterized by feminization and gender division of labor: in
fact in Cyprus there are more women migrants than men. We have pro-
cesses that have created the conditions for the “globalization of care” as
Panayiotopoulos (2005) notes:
“a significant number of households responded to the growing demand for

care for the elderly by becoming petty employers of immigrant women. The
material above provides some illustration of how the labour regime and the day-
today lives of immigrant women are shaped by the nature of the care regime.”
The Cyprus case is a prime example of the commoditization of domes-
tic labor via the use and abuse of female migrant labor. Panayiotopoulos
(2005) puts it in this way:
Female migration from the Philippines to Cyprus and worldwide can be seen
as a practical illustration of globalisation in the personal-service sector. In the-
oretical terms, the transfer of reproductive labour can be understood as a form
of servitude. It is, however, very different to the servitude associated with the
employment of young girls from the countryside by wealthy urban households:
the labour regime in modern servitude is characterized by the commoditisa-
tion of reproductive labour itself, and the existence, in most cases, of written
contracts involving the payment of pre-agreed wages.
We can therefore speak of a demographically different working class
than in the 1980s, which is segmented and differentiated according to
sector, industry, position in the labor process, unionization, working
conditions/pay, and is socially located according to nationality, ethnic
background, migration status, sex/gender, disability, and age, which has
created a major challenge for the social agents of change. There is a generic
working class as a structurally positioned wage labor in a Marxian sense,
but we cannot speak of a unitary working class (Wastergaard and Restler,
1976). We can speak of a segmented labor class (Castles and Kossack,
1973) or a racialized class fraction (Miles, 1982). It is, however, highly
questionable whether we describe the situation in Cyprus in terms of the
“underclass thesis” (see Rex and Tomlinson, 1979). Race, racism, and eth-
nicity in the “the age of migration” (Castles and Miller, 2003) forces us to
think of the Cypriot context in terms of the “racialized boundaries” gen-
erated (Anthias and Yuval-Davis, 1992): the ambiguous identities in the
contradictory relations between “race”, “ethnicity,” and “class” and gender
(Balibar, Wallerstein, 1992; Miles, 1989).
In any case, a serious rethinking is required to appreciate the economic

and social context of migrant workers in Cyprus. Migrant workers are
perceived to be so apart from social integration, they are seen as tem-
porary and “transient” and are “otherized” as being “so different from
us”. However, today’s insecure world characterized by flexibilization and
deregulation is transforming employment and is increasingly affecting
the Cypriot labor market. Homeworking results in spatial destandard-
ization of work; increasing numbers of temporal work creates temporal
destandardization and informalization of employment in the direction
of “total destandardization” (Edgell, 2006). The rising unemployment is
forcing Cypriots to confront the “brave new world after all” as increasing
numbers of younger Cypriots are facing dilemmas of lack of job security
and “flexiwork” (Ioannou, 2012).
Migration and the Cheap Labor Model: Growth

and Accumulation in Cyprus
Migrant Labor in the RoC: Extending the Economic Miracle
by Super-exploitation?
A crucial factor that extended the life-line of the accumulation regime

was the change of immigration policy in 1990, which opened up the
island’s doors to migrants, which was mainly the result of this rapid
economic development emanating largely as a result of the world-wide
growth in tourism that increased the demand for labor in Cyprus. The
immigrant population has become an important component of the labor
force. In October 2010, out of 376,300 employed persons, 114,425 were
EU or third-country nationals, comprising 30.4 percent of those gain-
fully employed. The sending countries are non-EU countries (Sri Lanka,
Russia, Philippines etc.) and some of the EU countries (Greece, the
United Kingdom, Poland, Bulgaria, Romania etc.). As of October 2010
third-country nationals (TCNs) largely work in private household ser-
vice (domestic workers, carers etc.) and other services. This has remained
unchanged when compared to previous years, with the exception of the
decline in TCN employed in construction, restaurants, and the hotel sec-
tor. These sectors were among the hardest hit during the economic crisis
of 2009, and although further research is needed, the decline of TCNs in
construction is comparable to the decline of employment in that sector of
Cypriots (Greek and Turkish) and of Europeans.13 The tables below show
the migration movement of the last decade as well as the actual num-
bers of non-Cypriots working in Cyprus from 2005 to 2010 (table 12.3
and 12.4).
Table 12.3 Migration movements, 2000–2010, in the RoC
Year Total immigrants Total emigrants Net migration Net migration

rate (percent)
2000 12, 764 8, 804 +3960 +5, 7

2001 17, 485 12, 835 +4650 +6, 6
2002 14, 370 7, 485 +6885 +9, 7
2003 16, 779 4, 437 +12342 +17, 1
2004 22, 003 6, 279 +15724 +21, 3
2005 24, 419 10, 003 +14416 +19, 0
2006 15, 545 6, 874 +8671 +11, 2
2007 19, 142 11, 752 +7390 +9, 4
2008 14, 095 10, 500 +3595 +4, 5
2009 11, 675 9, 829 +1, 846 +2.3
Table 12.4 Employed non-Cypriots in the RoC
Year 2005 2006 2007 2008 2009 2010
EU citizens 23,558 16,838 30,482 42,630 48, 793 53, 875

Third country 46,225 45,868 49,560 53,693 58, 243 60, 550
Total 58,784 60,917 81,042 96,436 107,036 114,425
Numerous studies illustrate the contribution of migrant workers to the

economy. It must be pointed out, however, that these studies took place
in the background of strong economic growth, where the labor demand
was reaching the limits imposed by the domestic population. The studies
show the following.
First, it is estimated that the contribution of migrant workers to
the growth rate of total gross value added in 2004 compared to 1995
was 54.2 percent, which is the highest contribution among all factors
of production. Second, a number of studies (Pashardes, et. al., 2001;
Michael, et. al., 2005; Michael, et. al., 2006) suggest that there is no
relation between the presence of third-country migrant workers and
unemployment, but that there is some substitution (that is, displacement
of Cypriots by migrant workers) in the primary sector, not toward unem-
ployment but toward the secondary and tertiary sector and a much greater
job creation process in the tertiary sector. Third, migrant workers have
been beneficial in increasing the number of Cypriot women in the labor
market (Michael et. al., 2008). In particular, the domestic workers have
facilitated the increase in women’s participation in the workforce, par-
ticularly educated women.14 Women who have domestic assistance are
20,5 percent more likely to participate in the labor market than those
who do not. Studies and reports on migrant workers point to structural

issues generating ethnic and racial discrimination in the employment of
migrant workers.15
Overall, the working conditions in farming and agriculture, where
the workforce is almost entirely made up of migrant workers and asy-
lum seekers, are extremely poor: wages are well below the minimum
fixed by collective sectors of the economy. Matters are changing as EU
citizens form a vast majority of migrant workers today: they are not
unionized and employers do not require to obtain permits. In March 2012
there were 110,375 EU citizens registered with the RoC, out of whom
33,949 are from Greece, 23,803 from Romania, 21,872 from Bulgaria,
and 16,950 from the United Kingdom.16 A smaller number are paying
social insurance.
Migrant workers in the hotelier industry and construction are used as
cheap labor to undermine unions and the regime of a collective agree-
ment, in order to replace domestic workers by nonunionized EU citizens,
who instead had personal contracts under inferior working conditions and
pay.17 The practice of signing personal contracts with unfavorable terms
from those contained in collective agreements leads the deregulation of
labor relations and the gradual abolition of collective agreements, the fail-
ure to implement the laws and regulations and the creation of workers of
two or three speeds in the hotel industry (Ioannou, 2012).
Demographic Engineering and Super-exploitation

in northern Cyprus
The migration issue in the northern part of the country is closely

connected to the discourses on the contentious population issue in
Turkish-Cypriot politics18 and the relations between Greek-Cypriots and
Turkish-Cypriots. It has to be located within the context of the struc-
tural factors overdetermined by Turkey’s demographic engineering policy
as well as super-exploitation of irregular and precarious workers in a very
loosely regulated capitalistic system of unrecognized TRNC. There were
three waves of post-1974 migration to the north, which reflected the
political and socioeconomic reality in the northern part of Cyprus and
Turkey (see Hatay, 2008; 2007; Kurtuluş and Purkis, 2012). This is often
described as a colonial population policy on the part of Turkey. The first
one was in the immediate post-invasion period of 1974–1979, approach-
ing 15,000 persons per year moving from Turkey to the area north of the
barbed wire; this sharply receded to about 1000 per year in 1980–1984.
The second wave started in the mid-1980s to late 1980s and peaked in
1995–1999 with 10,000 persons per year. There was a sharp fall during
2000–2002 to about 3,000 persons per year, reflecting the state of the
economic situation. It then began to rise again, in that is described as the
third wave, reaching a peak of 20,000 per year in 2006.
The third migration wave from Turkey to northern Cyprus started
in the 1990s and 2000s and is connected to the neo-liberal policies in
mainland Turkey and in the TRNC. The rise in unemployment made up
of property-less ex-small farmer communities, together with the ongo-
ing conflict in Turkey’s southeastern and eastern regions led to forced
migration from the eastern and the southeastern regions of Anatolia to
nearby cities such as Adana, Antalya, and Mersin. Meanwhile the regime
in northern Cyprus as a peculiar extension of Turkish territory provided
opportunities to work in the growing construction sector, which was the
most important leading sector for capital accumulation. Research from
a field-survey project in the walled city of Nicosia19 illustrates that the
processes of informalization and precariatization of labor was the basis for
intense capital accumulation in the third wave of migrants from Turkey
since 2000.
From Slowdown to Crisis: The RoC GDP

and the Current Account Deficit20
For 20 years, from 1990 to 2009, the rate of GDP growth in the RoC was
exceeding the corresponding growth in the 15 most advanced economies
of the European Union. When Cyprus began to suffer the consequences
of the economic crisis, the economy slowed down and GDP growth
(Figure 12.1) during 2010–2011 was lower than the EU-15 average. As a
result, unemployment reached historical highs (9.6 percent in January
2012, 7.2 percent in 2011 compared to 3.7 percent in 2008; Figure 12.2).
The current crisis revealed in a dramatic way that the economy in the
RoC was already running out of steam in 2008. What was evident before
the crisis as a source of economic slowdown turns out to be now a severe
cause of threatening imbalances.
The deficit in the current account (Figure 12.3) rose in 2008 to a
historical high of approximately 12 percent of GDP, it remained above
9 percent until 2010, and decreased during 2011–2012 as domestic
demand is falling and imports decreasing. Weaknesses are also reflected
in export performance, the trade balance of goods and services, in the
economy’s dependence on tourism, in the existence of a productivity gap
against competing countries, as well as in other indicators of competitive-
ness. Furthermore, during the crisis years of 2009 to 2011, export markets
did not expand at all.
232
4
% Annual changes
0
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
–1
–2
–3
Year
Figure 12.1 GDP growth, 1996–2012

Source: Annual Macroeconomic Database, European Commission
7
Unemployment rate (%)
0
1996
1995
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Year
Figure 12.2 Unemployment rate (percentage), 1995–2011

Source: Annual Macroeconomic Database, European Commission.
0.08
0.06
0.04
0.02
0
% of GDP
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
–0.02
–0.04
–0.06
–0.08
–0.1
–0.12
–0.14
Year
Figure 12.3 Current account deficit as percentage of GDP

Tourism and Competitiveness

Tourism is the main source of foreign exchange, thereby directly or indi-
rectly affecting the economy as a whole. Nevertheless, this sector is at
the same time extremely sensitive and easily influenced by external fac-
tors, among which the most permanent is the rate of economic growth
in the EU-15 area. The heavy reliance on tourism industry renders the
RoC economy vulnerable to international fluctuations; GDP changes
in the EU-15 affect strongly the rate of change in the number of vis-
itors. A decline in the economic growth rate of the EU-15 below the
critical threshold of 2 percent was expected, before the crisis, to lead to a
reduction in the number of visitors to Cyprus. During the crisis, a rise
in visitors from Russia and other non-EU countries tends to mitigate
the negative effects of the decline in the west European demand. Dur-
ing the first decade of 2000, the Cypriot tourism industry responded
to international competitive pressure, lowering labor costs and intensi-
fying its efforts to offer mass tourism services. This reaction proved to
be wrong since international demand was shifting toward higher quality
and differentiated products. Structural changes were necessary to improve
the non-price competitiveness of the Cypriot tourism industry in order
to restore the balance in the current account. Non-price competitive-
ness is based on quality, innovation, product diversification, favorable
geographical orientation of sales etc. As a result of the wrong strategy

aiming at lower unit labor costs, the number of visitors did not increase
during 2000–2009 and declined in 2010–2011.
Financialization: From an Export-Driven

to a Consumption-Driven Economy
Until 2001, the tourism industry was the engine of growth of the
RoC economy. The number of visitors did not increase remaining
approximately stable during the decade of 2000. After a recession during
2002–2003, a shift from export-led growth to consumption-led growth
took place. During the five years of 2004–2008, the economy was boosted
by the rise in private consumption and fixed capital investment, mostly in
construction (housing and public works). Both consumption and residen-
tial construction were fuelled by easy and low-cost borrowing following
banking liberalization and preparations for the adoption of the Euro
(January 01, 2008). The change of paradigm from an export-driven to
a consumption-driven economy was the result of financialization and
low-interest borrowing from the international markets as Cyprus gained
confidence in view of its participation in the Eurozone.
Domestic demand–led growth resulted in large increases in imports,
while tourism receipts were lagging behind. Since 2004 the current
account deficit grows dramatically and ends up at the high level of approx-
imately 12 percent in 2008. These developments are strong signs of the
reduction in competitiveness that require restoration to maintain the level
of income at its actual level. The RoC economy has to move to a position
not only where inflation will be stable: serious action is required to reduce
the creeping unemployment while at the same time ensure a balanced (or
sustainable) external trade of goods and services.
The present circumstances make it an urgent task for the RoC to
promptly and effectively deal with the adverse effects of the economic
crisis on tourism, which are being diffused throughout the economy.
In the forthcoming years, the number of visitors will probably continue to
decrease, since in the following years the Cypriot tourism industry is going
to find itself faced with the cumulative negative effects, on the one hand,
of a decline in international demand for tourism services as a result of the
crisis, and on the other, of the structural defficiencies of the industry. For
this reason, a priority must be put on significantly improving competitive-
ness in the tourism industry. In this frame, the economy must move away
from the mass tourism model based on low quality, precarious labor, and
environmental damage, toward a higher-quality and ecofriendly tourism
in what we refer to as the high road to competitiveness (see Ioakimoglou,

et al., 2011).
Debt and Exposure to Risks of the Banking System

Private consumption was the growth engine of the Cypriot economy dur-
ing the recovery in 2004–2008, although the average real wage did not
increase (Figure 12.4). The apparent contradiction was resolved through
an increase of lending to workers’ households. Consumer spending and
residential investment were fuelled by loans given to workers although
their purchasing power for their wages remained constant. Therefore, at
the end of this period (2008), profitability was high after five years of con-
stant wages and income redistribution, workers’ households were highly
indebted, private consumption was approximately 20 percent higher than
in 2004, residential investment and banking profitability were at histor-
ical highs, and the current account deficit was unsustainable. Recovery
and boom of 2004–2008, exploding profits and financial euphoria, were
achieved at the cost of a historically high current account deficit and a
high debt burden of households. These are the reasons that the RoC
190
180
% of 1995 value (1995 prices)
170
160
150
140
130
120
110
100
1995
1999
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Year
Private consumption Annual real wage
Figure 12.4 Real wage and private consumption

economy is now in a process of adjustment with falling real wages and

domestic demand, slow growth and exploding unemployment, decreas-
ing imports and a large current account deficit. A large part of profits
of 2004–2008 were invested in the financial sector where rates of return
on capital were increased. During the following years, that is, the cri-
sis years, private banks invested heavily in Greek bonds due to wrong
expectations and following bad advice from the Cypriot Central Bank.21
As a result, the RoC banks are now exposed to high risks and have
been downgraded by international markets. Currently, the most serious
threat to economic growth derives from the two large bank’s exposure
to the Greek crisis: the only way out is public ownership and control of
these banks.
The public debt of the RoC was relatively low (65 percent) com-
pared to the Euro area average (88 percent) or the corresponding debt of
Germany (82 percent), France (85 percent), or Italy (120 percent) at the
beginning of the crisis. However, the public debt ratio in Cyprus is set to
rise as the government seeks international lending either from third coun-
tries or from the EU financial stabilization mechanism in order to finance
the banking system’s recapitalization requirements and the budget deficit
and debt refinancing needs. The banking crisis in Cyprus mostly related
to the Cyprus banks’ exposure to Greek public bonds and to expected
bad debts of the subsidiaries of Cyprus banks operating in Greece is set
to modify dramatically both the public debt level of the Cyprus economy
and the future prospects for economic development.
The High Road to Competitiveness

The RoC economy is characterized by reduced non-price competitive-
ness. In other words, the unemployment rate at which constant inflation
and balanced external trade of goods and services can be achieved is rel-
atively high. Given low non-price competitiveness, an improvement in
the external balance of goods and services through internal devaluation
would lead to a painful and long recession. Econometric estimates show
that to achieve an improvement in price competitiveness of 15 percent, a
fall by approximately 25 percent in GDP would be needed. The internal
devaluation process has begun with the various deregulation policies as
well as the public expenditure cuts imposed. Deflationary public expen-
diture measures threaten to spiral the economy into further recession and
economic disaster, following the same path with Greece.
A policy toward the improvement of structural competitiveness (non-
price competitiveness) in the RoC and the development of new export
Table 12.5 Determinants of structural competitiveness
International trade Export industrial specialization, geographic orientation of

exports and imports, product quality, adjustment to global
demand, product differentiation.
Product markets and labor Enterprises’ power in product markets, price elasticity of
markets demand, oligopolies, autonomous claims of enterprises and
employees on net product, labor market institutions.
Productive capacity Restructuring of production, new forms of work
organization, industrial specialization.
[Source: Cyprus Labour Institute, INEK-PEO (2011), Cyprus Competitiveness under EMU, Nicosia
(authored by Elias Ioakimoglou)].
oriented economic sectors is urgently needed in order to shield the econ-

omy from the painful consequences of a possible internal devaluation.
The question is how the economy can improve its structural competi-
tiveness. From a macroeconomic approach of competitiveness, structural
competitiveness can be defined in terms of the unemployment rate that
can be achieved under conditions of stable inflation and balanced or
sustainable external balance of goods and services. In this context, please
see Table 12.5 shows the determinants of structural competitiveness.
A number of historical, social, technological, and political factors con-
tribute to the structural competitiveness of a country (or a region), such
as the level of technology used, the size of production units, the current
level of labor force, the rate of replacing and upgrading the mechanical
equipment, the replacement rate of work operations by mechanical sys-
tems, the type of products in which there is a competitive advantage,
the country’s historical relations with the international and domestic
economy, which explain the existence or absence of important commer-
cial transactions with specific markets, geographic regions with which
exchanges of goods take place, traditional social relations within the work-
place and their impact on the formation of effective collective forms of
labor organization, the framework within which employment relations
are configured, as well as product quality and reputation. The increasing
internationalization of production and the globalization of financial and
capital markets create new competition terms and conditions, and give
prominence to new sources of structural competitiveness. New circum-
stances emerge regarding the mobility of the production factors: some of
them gain maximum mobility, while certain others remain rigid, either
within national borders or within regions. Telecommunication networks
make it easy to access information from any place of the developed world,
and to use services related to product marketing and trading, accounting,

as well as a number of other business services.
There is a low road to competitiveness that is internal devaluation, a
well-known economic policy aimed at reducing prices through painful
recession, high unemployment, increasing inequalities and social despair,
reduction of wages, pensions and unit labor costs, and there is a high road
to competitiveness, which is the restructuring of the productive system in
order to produce new and higher-quality products, to adapt domestic sup-
ply to changing international demand, to meet new tastes of consumers
in export markets etc.
Whether Cyprus will take the high or the low road to competitiveness
depends on the balance of power between social and political forces.
Sketching Out a Different Path of Development

The impact of the global economic crisis, particularly the large bank
exposure to Greece, is the primary cause of the serious economic dif-
ficulties that Cyprus has to face. However, there are also underlying,
structural long-term factors that have given rise to an unsustainable model
of economic development. The unsustainability of the model of economic
development applies to the economies on both sides of the dividing line,
although each side has its own peculiarities. The structural limitations
of the model of economic development, which has been followed up to
the present, have been noted repeatedly by various studies, although these
issues have not been discussed adequately, if at all, at an internal political
level. Briefly, we note some of the structural deficiencies of the model of
economic development below.
• Excessive dependence on tourist development.
• Adverse environmental consequences of mass tourist development.
• A gradual process of de-industrialization (low contribution of the
manufacturing sector to GDP).
• Deficiencies regarding expenditure on research, productivity growth,
and the ability to adopt and develop new technologies.
• High balance of trade and current account deficits.
• Undemocratic, socially and environmentally unsustainable develop-
mentalism.
• A large informal economy sector.
• Uncollected taxes and tax evasions.
We propose that we shift the debate forward in what we consider to be the
direction for a sustainable economic model, that is, a model that properly
incorporates the social and environmental/ecological issues as the central
aspects of the economy. However, it is essential to consider the parame-

ters of a sustainable model of economic development in Cyprus in the
context of a potential settlement of the Cyprus problem and the re-
unification of the island. Any settlement to the Cyprus problem needs to
address the broader issues of reconstruction and development, including
property-related aspects, which include the real estate market and financ-
ing, and the compensation and resettlement costs for displaced persons.
The estimate ranges of the cost of re-unification vary: for instance, com-
pensation costs range from ¤8 billion to ¤19 billion, rehousing costs
could range from ¤1 billion to ¤2.5 billion; even the minimum esti-
mates of ¤9 billion amounts to 45 percent of Cypriot GDP.22 There is a
big gap between expectations and payouts. However, the issue of the “cost
of solution” must be approached differently—totally differently—and has
to be considered as investment for reconstruction and development. The
Marshall aid program was a massive injection in investment; the so-
called cost of solution is in reality investment for a new re-united Cyprus.
In fact, in the context of an agreed settlement, particularly in the current
economic slowdown, which is deep, structural and massive investment
in the northern part of Cyprus in sustainable and properly managed
projects offers a huge potential for economic development and a distinct
possibility for a way out of the crisis.
There is an additional issue relating to the so-called cost of solution
which has to be considered: what is the cost of separation/partition—an
issue addressed by Ayres (2003). We ought to widen the scope of this
issue to consider the psychosocial and political as well as economic cost of
the insecurity and the uncertainty of status quo. Estimating the socioeco-
nomic value of peace, stability, and security is something to be developed
in the research agenda of a critical political economy. The research agenda
must attempt to address a number of key questions: What public and
social space is unleashed with a solution? How do we shift resources from
negative features relating to managing the conflict and de facto partition
(army, diplomacy, empty space, land mines, check points etc.) toward
constructive forces (health, education, unsustainable development fund
etc.). What social, political, symbolic, and other material interests will
be affected by a possible settlement? What synergies can be created by a
solution? What is the strategy for sustainability in the Cyprus context?
Alternatives: Sketching Out a Different Path of Development

We now raise certain questions that may allow us to shift the debate for-
ward in what we consider to be the basis of a sustainable economic model.
The question of development and sustainability from a comparative
political economy perspective, although it ought to draw on ideas and

experiences from different countries and social, economic and political
contexts, nevertheless it must be properly grounded in the specificities of
the socioeconomic and historical context of Cyprus. Unless such a socially
and historically contextualized approach is taken, one runs the risk of
introducing ideas, innovative and inspiring as they have developed and
successfully applied in other contexts, but may result in complete failure
when “planted” in Cyprus. The vision must be based on the current and
historical realities and socioeconomic trends by trying to critically engage
with the successes and failures of different fields, sectors, and the whole of
the economy. A close look at the post-1974 development in the economy
under the control of the RoC, after the end of the immediate crisis man-
agement, provides us with some clues. The global economic crisis has put
an abrupt end to almost uninterrupted economic growth in Cyprus and
this is primarily an exogenous factor, rather than something internal to
the Cypriot economy. However, we have located a longer-term structural
process, which is associated with the long-term slowdown of economic
growth, and which we can describe as the exhaustion of the current model
of economic growth or an end to an accumulation regime.
We outline below some pointers regarding the sustainability of a
prospective model of economic development in Cyprus in terms of:
(a) the concept of “real convergence”; (b) factors leading to increasing
trade, cooperation, and exchange between Greek-Cypriots and Turkish-
Cypriots; and (c) introducing critical sustainability as a dual concept
that encompasses the environmental as well as the social aspects of
development.
Development and Sustainability

in the Light of a Possible Solution
Thinking about the model of development of a reunited federal republic
in concrete terms is a difficult task given that we do not have the precise
parameters regarding the political, institutional and economic,23 provi-
sions of the framework agreement of a re-united Cyprus. The current
situation, the de facto partition with limited exchange, is obviously not
the desired way to move into the future. The north appears to be more
or less following the same path of environmentally destructive and badly
planned development at all costs and in a similar fashion to what RoC
did for a long duration after 1974. In fact what can be said about the
south is that there have always been certain sectors of economy whose
motto was not technical or technological innovation or product inno-
vation but use of cheap, unskilled labor. These economic sectors have
flourished since the change of policy in 1990 allowing temporary migrant

workers to enter the country. Today they are over 20 percent of the total
working population.24
The observation about this kind of “development” must begin by chal-
lenging the corporate interests and engaging is a serious rethinking of the
meanings of “sustainability” and “corporate social responsibility,” draw-
ing on the heterodox and radical traditions of economics,. Also we have
to consider in a critical perspective and professional interests and activ-
ities associated with civil engineering, architecture, and planning, which
had a very significant influence on the nature of social and environmental
development in Cyprus. There is immense scope of collaborative alterna-
tive projects by environmentalists, activists, local resident action groups,
and trade unionists in the context of an alternative model of sustainable
development in Cyprus. Moreover, If we take seriously the contention
that the key driver of the “Cyprus economic miracle” has been the labor
force (Christodoulou, 1992), then we must address this in our vision
for an alternative development. This is not confined to the “Cypriot”
labor force, but it certainly includes migrant workers. In the days of eco-
nomic crisis, this requires moving in the opposite direction of the way
the neoliberal austerity measures are driving: we need new employment
strategies as well as democratizing work and enhancing cooperatives and
co-ownership.
Parameters for a Sustainable Model of Economic

Development
We need a research agenda that adopts a critical approach to sustainable
development as we must take seriously the ecological crisis at a global level
(Strange, 2000; Spence, 2000). At the same time we critique concepts cur-
rently in vogue, which have been essentially appropriated by mainstream
or hegemonic discourses, which gloss over or obscure the “social ques-
tion,” underlying the notion of sustainability that is determined by class,
gender, migrant related, and antiracism struggles and contestations.25
In our perspective, the question of development and sustainability is inte-
grally connected to the perspective of envisioning a reunited Cyprus,
based on full equality of Greek-Cypriots and Turkish-Cypriots in a
bizonal, bicommunal federation, whilst it is simultaneously integrated
in a politics of class struggles toward socialism. A serious rethinking
of the model of economic development on both sides of the dividing
line is urgently required. In the context of negotiations for a politi-
cal settlement, the debate on any institutional framework of sustainable
development within the parameters of a solution is totally marginalized;

even mainstream approaches to sustainable development are subordinated
to the neoliberal logic of private-led economic governance or property
development. It is high time that the settlement in Cyprus should not
be seen as a purely political and legal arrangement but also socioeco-
nomic and ideological aspects have to be integrated in the search for a
solution.
A post-settlement reunited Cyprus needs a broader vision based on
new principles, to break down the ethnopolitical barriers and economic
interests generated and perpetuated by the de facto partition and open
up spaces for new kinds of cooperation among the two communities.
Huge social as well as economic investment possibilities in a reunited
Cyprus will ensue. Planning for an alternative model of economic and
social development with due consideration to environmental protection
means learning from the past, knowing that a continuation of the existing
mode of economic and social organization will inevitably lead to renewed
limitations and constraints in the not too distant future.
The institutional framework for the achievement of such objectives,
which is made more complicated in a federal state context, must be
robust. Embarking on an alternative path of sustainable development is
a complex and ambitious objective that requires not only an appropri-
ate institutional framework but also the political and social struggles to
support it and and challenge the resistance of vested interests. Essential
steps in the direction of an alternative sustainable model of economic
development include moving away from the speculative, profit seeking
private banking system to social development banking which includes
the cooperative banking sector, moving beyond the mass tourism model,
and giving priority to knowledge-intensive industries, extending social
provision, and protecting the environment.
The main parameters of a sustainable model of economic and social
development could be summarized as a model of economic develop-
ment that is more autonomous, diversified, and to the extent possible
in a small economy, endogenously driven with emphasis on sustainable
re-industrialization on a knowledge-intensive basis. The development of
sustainable forms of tourism such as agro-tourism, cultural and health
forms of tourism accompanied by strict planning criteria that abide by
environmental standards and regulations are essential planning tools for
the future. Sustainable economic development also entails the rebuilding
of the manufacturing sector in new directions that embody new tech-
nologies, skilled labor, and high productivity. One example of a sector
that is often referred to is the renewable energy sector. In this context,
the development and modernization of knowledge-intensive services as
well as the development of organic forms of agriculture could form part

of a sustainable development strategy. Below we list the parameters of
sustainable economic development.
• Economic restructuring to upgrade the productive sectors of the

economy regarding agriculture and manufacturing industry by uti-
lizing research, knowledge intensive activities and new technologies.
• Extension and qualitative upgrading of social welfare provision in
Cyprus.
• Sustainable urban and rural development.
• Developing an integrated class, gender, and antiracism strategy.
• Enhancement and extension of the cooperative movement in differ-
ent fields.
• Environmental protection.
Thinking critically about the political and institutional context leading to

the formation of developmental state in Cyprus is essential if we are to
supersede the minimal, neoliberal state that we had up to now. A critical
model of a developmental state operates in the framework of target-
setting, planning institutions that function in strategic, interventionist
direction, by taking into consideration the political and social support
necessary as well as the constraints, resistance, and conflicts it would have
to face. In this context, as has become obvious from the recent phe-
nomena associated with the economic crisis, the role of developmental
banking under the strategic control and direction of the state has become
absolutely crucial.
We propose innovative forms combining sustainable, democratic, and
social-centered and state-led and cooperative development. Such a per-
spective must be informed by four principles that can be placed under the
following headings:
1. A critique of the developmental state in the Third World, including

the post-independence and post-1974 Cypriot version, which insti-
tutionalized the relationship between state and economic develop-
ment on the premise of “subordination of working class interest to
that of the ‘national’ interest” (see Panayiotopoulos, 1995, p. 47).
2. Socially owned, democratically controlled and directed economic
projects, which take seriously and goes beyond “envisioning real
utopias” (Wright, 2008) and the experience drawn from what is a
socially embedded Cypriot cooperative movement. This is shared
by both communities, Greek-Cypriots and Turkish-Cypriots, in
Cyprus.
3. New and more radical versions of environmental and social

sustainability considerations for the more equitable sharing of
wealth and the interests of future generations in harmonizing
the relation with the ecosystem of the eastern Mediterranean.
Future economic development is best understood in a framework
for regional cooperation in the eastern Mediterranean, particu-
larly after the discovery of hydrocarbons off the shores of Cyprus.
Equitable sharing of the benefits of the hydrocarbons is another
challenge for a critique of political economy.
4. It is high time research began to properly engage the issue of how
migrant workers are affecting the dialectic of transformation that is
taking place. We are required to go beyond the so-called uniqueness
so that we can locate what is particular, comparable, and uni-
versal as a southern European state in the eastern Mediterranean
region.26 The migration question in Cyprus must be seen over a
much larger time span as Cyprus is, by geopolitical location and
historic conjuncture, a border society, and historically a frontier
society de facto divided by a default line, a buffer zone that is
almost impossible to police. Moreover, we need to rethink the pro-
cesses of Europeanization of migration, integration, settlement, and
exploitation of precarious migrants and relate them to class and
social struggles in the country. The narratives of the migrant work-
ers point to the need to rethink the nature of “borders” and to
reconceptualize the policies regarding migration control via an out-
moded and ineffective “border policing.” Migration is not a passive
product of change, migration is a motto of change and migrants are
agents of change.
Conclusions
The model of economic development in Cyprus, particularly in the
context of a settlement, needs to be radically reconsidered. The most
important aspect of this challenge is to develop strategies for the social
and political forces of labor that illustrate the necessity of such an orienta-
tion. Drawing on research, social and political dialogue, and international
experiences of successful case studies is crucial; however, we must remain
critical and avoid replanting and copying. Free market principles do not
lead to a sustainable economic development; on the contrary, they are
the primary cause of the current situation and threaten to drag Cyprus to
depression. A political settlement in Cyprus should be considered to be
the beginning for rebuilding the society as a social entity for all, surpassing
the ethnic and racial divide. The socio-economic aspects of a settlement
are too important to be left to mainstream economic and legal experts and
to entrenched economic and social interests. We need critical perspectives.
In the absence of a settlement, it is essential that future research must
examine further different aspects of social and economic interdependence
between Greek-Cypriots and Turkish-Cypriots as well as all other commu-
nities that are present in an increasingly multicultural setting: education,
health, and social divisions and struggles taking place on both sides of
the country must be studied more closely. The transformations taking
place in the country and the region are radically reshaping the socioeco-
nomic, political, ideological, and cultural landscape. Also, it is crucial that
a critical political economy perspective integrates the Cypriot economic
processes within the wider socioeconomic and political transformations
in the context of the region and the globe. Further study is required
of the crisis in the euro zone and the imposition of austerity measures,
which is radically deepening the crisis, increasing migration from EU
countries causing an even more serious problem, such as from Greece.
Also, the situation in the northern part of the country needs to be closely
monitored; struggles are increasingly interconnected as ideas and move-
ments spread across the barbed wire. Moreover, critical political economy
perspectives of the new geopolitics hydrocarbon exploitation in the Mid-
dle East and Cyprus are urgently required; developing research agendas
on social and environmental repercussions and alternatives in sharing the
benefits and costs of the extraction of natural gas has yet to feature in
research or public debates. In the light of the current economic crisis,
which may last for some more time, these are prerequisites for envisioning
a country beyond the divide in a region of cooperation rather than impe-
rial contestations. As the holy scripts of economic orthodoxy collapse, we
must at least imagine alternatives.
The challenge of economic restructuring and sustainable development
in Cyprus has become immensely more difficult as the global economic
crisis had a very significant impact on the economy mainly through the
crisis of the banking sector. The exposure of the two large banks in Cyprus
to Greek public bonds and the bad debts expected through the operation
of their subsidiaries in Greece have given rise to unsustainable losses in the
banking sector and the need for their recapitalization through state sup-
port. However, international finance to the Cyprus state has been blocked
as a result of repeated adverse ratings by the international rating agencies,
citing as the main reason the state of the banking sector in Cyprus. The
Government of Cyprus has desperately tried to secure the required finance
through inter-state loans, an effort mainly directed to Russia, which did
not produce the required results. The unavoidable alternative has been an
official request by the government of Cyprus for financial support to the
EU financial stabilization mechanism. The EU finance facility, however,

as seen in the case of Greece and the other EU periphery countries, is
accompanied by strict economic conditions consisting of austerity mea-
sures and market enhancing economic reforms which lead to what has
been referred above as internal devaluation. Such measures have to be
resisted since they will lead the economy of Cyprus into deeper reces-
sion and higher unemployment. A comprehensive alternative model of
economic restructuring has to be proposed by the government of Cyprus
and supported by social and political forces based on nationalized banking
system and sustainable economic development.
Notes
1. We would like to thank Umut Bozkurt, Gregoris Ioannou, Ron Ayres, and
Sotiris Kattos for their comments on an earlier version of this chapter.
2. See Constantinou (2008) and Trimikliniotis (2009, 2010).
3. See, for instance, Bryant (2010).
4. See “Economic Interdependence in Cyprus,” main findings and recommen-
dations, http://www.undp-act.org/data/articles/interdependence_report_
2011.pdf (accessed February 26, 2012).
5. This figure is attributed to the former leader of the Turkish-Cypriot
community Mehmet Ali Talat and is related to the mobile telephone sub-
scriptions and the numbers of motorized vehicles registered; see Halil Paşa’s
intervention in the debate, BILBAN-IKME (2008, p. 125).
6. In a landmark case, the European Court of Justice (ECJ) ruled on July 05,
1994, against the British practice of importing produce from northern
Cyprus. The ECJ decided that only goods bearing certificates of origin from
the Republic of Cyprus could be imported by EU member states. The deci-
sion resulted in a considerable decrease of Turkish-Cypriot exports to the
EU
7. See Demetriou and Vlachos (2007).
8. Corrigendum to Council Regulation (EC) No 866/2004 of April 29, 2004
on a regime under Article 2 of Protocol 10 to the Act of Accession (OJ
L 161, 30.4.2004), http://eur-lex.Europa.eu/smartapi/cgi/sga_doc?smartapi
!celexplus!prod!CELEXnumdoc&lg=en&numdoc=304R0866R(01.
9. See ECRI (2005) Third Report on Cyprus, European Commission against
Racism and Intolerance, Council of Europe, Strasbourg, May 16, 2006 and
Corrigendum to Council Regulation (EC) No 866/2004 of April 29, 2004
on a regime under Article 2 of Protocol 10 to the Act of Accession (OJ L
161, 30.4.2004).
10. See Communication from the Commission COM (2006) 551 final, Brussels,
September 25, 2006, at http://eur-lex.Europa.eu/smartapi/cgi/sga_doc?
smartapi!celexplus!prod!CELEXnumdoc&numdoc=506DC0551&lg=en.
11. We would like to thank Dr. Alex Apostolides for pointing out how important
interdependence is for the economy and society.
12. That paper periodized development in Cyprus in the following peri-

ods: Colonial Modernization from above and from outside 1878–1960;
postcolonial “developmentalism”; 1974–1990 Modernization by default
and the introduction of cheap migrant labor; Europeanization and
Modernization.
13. For further analysis, see Trimikliniotis (1999, 2010c, 2011); Trimikliniotis
and Pantelides (2003); Ioannou (2012b).
14. The rate of participation of women in the labor force increased from
50.5 percent in 1985 to 53.3 percent in 2004; in contrast, the corresponding
rate among men dropped from 94 percent in 1985 to 73.5 percent in 2004.
15. See Intercollege Report (2002); Trimikliniotis (2012, 2010c).
16. Figures from Ministry of Interior up to 13 March 2012.
17. The Equality Authority investigated the practice of hoteliers to dismiss
Cypriot workers, A.I.T. 1/2011, June 22, 2011. See also Trimikliniotis
(2011b).
18. See Hatay (2005, 2007, 2008); Faiz (2008); Bilban-IKME (2008).
19. Research project (no. 106K330) by Kurtuluş and Purkis, supported by
the Scientific and Technological Research Council of Turkey (TUBITAK).
Kurtuluş and Purkis (2012) draw on this research.
20. All data and analyses in this section are from the annual edition of
The Economic and Employment Outlook and the recent study Cyprus
Competitiveness under EMU of the Cyprus Labor Institute (PEO).
21. Former Finance Minister Stavrakis (2012) went further claiming that the
Governor of the Bank had advised bankers not to buy RoC bonds and buy
Greek bonds.
22. Estimates by Fiona Mullen at the conference September 30, 2011, on prop-
erty issues within the context of displacement in Cyprus; see Trimikliniotis
and Sojka-Koirala (2011).
23. See the outlook on a PowerPoint presentation at: http://www.inek.org.cy/
english/. For an interesting debate on the subject of “convergence” of the two
parts of Cyprus, see the website of the Management Centre, which hosts the
papers of the Wolfson group at http://www.mancentre.org/OtherActivities/
Wolfson/Wolsonindex.htm
24. See recent statement by Ministry of Labor: cheap labor is provided in the
north from Turkey.
25. For a critical analysis, see Corbridge (1988); Paris (1993), pp. 233–238;
Forster (2000).
26. For a critical analysis, see Corbridge (1988); Paris (1993), pp. 233–238;
Forster (2000).
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Contributors
Editors
Nicos Trimikliniotis is an interdisciplinary scholar working in the fields

of sociology and law. He is an associate professor of law and sociol-
ogy at University of Nicosia; Senior Research Consultant, PRIO Cyprus
Centre; and honorary research professor of University of Cape Town.
He has researched on ethnic conflict and reconciliation, constitutional
and state theory, integration, citizenship, education, migration, racism,
gender, human rights, free movement, discrimination, and labor issues.
His works include Gauging the Global Cycles of Deviance (with Ari Sitas,
Sumangala Damodaran, and Wiebke Keim, forthcoming); Contested Inte-
gration, Migration and Societal Transformation (University of Nicosia
Press, 2013); The Nation-State Dialectic and the State of Exception (Greek)
(Savalas, Athens, 2010); Rethinking the Free Movement of Workers: The
European Challenges Ahead, Wolf, Nijmegen, 2009 (co-edited with Paul
Minderhoud).
Umut Bozkurt is a lecturer at the Department of International Relations,

Eastern Mediterranean University, Cyprus. She completed her PhD in
politics in the University of York, United Kingdom. Her research interests
are state theory, critical political economy, and modern politics of Turkey
and Cyprus. She worked as the co-country manager of the International
Center for Transitional Justice’s Cyprus program, which was aimed to help
pave the way for a revision of the divisive historical narratives held by each
side in Cyprus. Her latest works include “Neoliberalism with a Human
Face: Making Sense of Justice and Development Party’s Neoliberal Pop-
ulism in Turkey”, Science and Society [forthcoming, Volume 77 (2013)]
and a working paper titled “Legacies of Violence and Overcoming Con-
flict in Cyprus: The Transitional Justice Landscape” (co-authored with
Christalla Yakinthou) (Peace Research Institute of Oslo [PRIO], Cyprus,
2012).
278 NOTES ON CONTRIBUTORS
Authors
Hakan Aslan is currently a part-time instructor at İstanbul Bilgi Univer-

sity. His research interests include Marx and Marxism, socialist planning,
labor movement in Turkey, Turkish Cypriot politics and economy, and
recently, for-profit universities and more broadly academic capitalism and
unionism.
Giorgos Charalambous is an associate teaching staff at the University of

Cyprus and visiting lecturer at Frederick University, Cyprus. His research
is focused on political parties, the European radical left, the domestic
politics of European integration, and Cypriot politics.
Elias Ioakimoglou is a senior research associate for the Cyprus Labor

Institute (INEK-PEO) and the Greek Labor Institute (INE/GSEE). He
has researched and published widely on economy, labor and workers’
movement in Greece and Cyprus.
Niyazi Kizilyurek is a professor at the Turkish and Middle Eastern

Studies Department at the University of Cyprus. He published on mod-
ern history and politics of Cyprus and Turkey, in Greek and Turkish
languages.
Tassos Kyprianidis is a consulting professional in Athens, Greece, and a

member of the Editorial Secretariat of the journal Θ έσ εις (Theseis). He
has published widely on the Left, Marxism, and politics.
Dilek Latif is a lecturer in the International Relations Department of

Near East University. Her research focuses on history and education,
conflict and societal peace.
Neofytos Loizides is a senior lecturer in international conflict analysis at

the University of Kent and the associate editor of Nationalism and Ethnic
Politics. His research focuses on nationalism, federal arrangements, and
conflict regulation in deeply divided societies.
John Milios is a professor of political economy and the history of eco-

nomic thought at the National Technical University of Athens, Greece,
and the editor of the journal Θ έσ εις (Theseis). He has authored many
articles and books on various aspects of political, ideological, social, and
economic issues.
NOTES ON CONTRIBUTORS 279
Andreas Panayiotou is an assistant professor at the Frederick University,

Cyprus. He has carried out research in the areas of social movements and
the world system, mass communication, and cultural studies.
Panayiotis Pantelides is on the academic board of the Cyprus Labor

Institute and a founding member of the Cyprus Institute of Critical Social
Research and Dialogue. He has taught and researched political economy,
European integration, and industrial policy and development.
Edward Rooksby teaches politics at Ruskin College, Oxford. He has

published several papers in political theory and is currently writing a book
about the British philosopher John Gray.
Ari Sitas is a sociologist, poet, and writer. He is a senior professor of

sociology at the University of Cape Town. He has published widely on
labor sociology, trade unions, globalization, reconciliation, culture and
society, and post-apartheid South Africa.
Emine Tahsin teaches development economics courses at the İstanbul

University and is currently coordinating a project on migration and
women in northern Cyprus.
Index
Note: The letter ‘n’ followed by the locators represents notes in the text.
accession of Cyprus to the EU, 11, 13, necessary for imperialist interests,
39, 79, 92–4, 137, 139–40, 94, 97
144–5, 148, 158, 185, 190–1, and partition, 9, 16, 91, 96–7, 163,
198–9, 218, 222 187, 195
Acheson Plan, 22, 89 reducible to imperialist interests,
Acquis, 9, 61 94, 97
Adalet ve Kalkınma Partisi [AKP] and reunification, 16, 163, 185,
(Justice and Development Party), 189–90, 194, 201
12, 39, 93, 144–9, 150n9, and Russia, 91
150n10, 191, 193 and United States, 32, 34, 93–5
Agamben, Giorgio, 61, 66n21 annexation of Cyprus by Turkey, 6,
Agia Marina, 192 19n20, 75, 100, 105, 107, 116
Akıncı, Mustafa, 181, 192 Anthias, Floya, 34–5, 51–4, 225, 227
Ali, İhsan, 123–4, 133n5 anticolonial struggle, 8, 53
Althusser, Louis, 41n5, 53, 57, 65n14,
anti-communism, 106–65
65n19
anti-imperialism, 25, 36, 74–8, 81,
ANAP Anavatan Partisi (Motherland
94, 96, 154–5, 163
Party), 138, 142
See also İmperialism
Anastasiades, Nicos, 12, 187, 193,
199 Arabs, 12, 17, 27–8, 77, 87
Anderson, Perry, 5, 19, 32, 43, 94, 98 Archbishop of Cyprus, 49, 52–3, 70,
Ankara, 6–7, 10–13, 16, 18, 19n20, 76, 88, 100–1, 103–4, 106, 161,
21n45, 27–9, 33, 36–9, 57, 185, 189
58n14, 90, 125–7, 131, 138, Archiepiscopate, 101
169, 172, 174, 176, 182, 191, Armenians, 196
193, 197, 220 Asomatos, 192
Annan Plan, 6, 9–10, 12, 16–17, 39, Association of Turkish-Cypriot
91–7, 145–7, 163, 182–5, 187, Students, 172
189–90, 194–5, 201 Athens, 37, 43n19, 50, 53, 76, 105–6,
and British bases, 28, 32, 34 109–11
EU accession, 91–2 Atun, Hakkı, 178
imperialist critics of, 93–4 austerity measures/package, 7, 15–18,
and NATO, 6, 39 21n43, 36, 45, 220, 241, 245–6
282 INDEX
Aνανεωτ ικó ∆ηµoκρατ ικó Britain/British, 1, 3, 6–8, 11, 20n24,

Σoσ ιαλισ τ ικó K ίνηµα 23–4, 31–5, 43n29, 44n31, 54,
[ADESOK] (Reformist 64n9, 65n11, 68–70, 72–4,
Democratic Socialist Movement), 83–98, 99–100, 103–5, 109–10,
156 111–12, 116, 122–3, 127–9,
Averof, Evangelos, 110, 112, 114–15 133, 134n8, 154, 167–8n3, 169,
Aνoρθωτ ικó K óµµα 186, 246n6
Eργ αζ oµένoυ Λαoύ [AKEL] bombing of Lebanon and Iraq, 28,
(Progressive Party of Working 91
People), 12, 15, 20n31, 29, colonialism/rule of, 1, 7–8, 20n24,
43n18, 45n41, 54–5, 64n7, 23, 31–3, 43n29, 49–51, 54,
64n8, 71, 73–5, 78, 82n5, 87, 59, 68–70, 72–4, 82n4, 82n6,
93, 101–5, 108, 110, 113, 125, 85–6, 100–1, 109, 116,
151–68, 170–1, 174–5, 179, 122–3, 127–9, 154, 167–8n3
183, 187–91, 193, 195–6, 198–9 decline of, 24
Avrupa Newspaper, 181 and establishment of the state of
Ayres, Ron, 51–4, 224–5, 239 Cyprus, 88, 99, 109, 114,
130–1, 176
bailout, 15, 220 global system of bases, 8, 24
banking crisis, 16–17, 150n3, 236 intelligence and surveillance, 1–2,
Bayar, Celal, 126 33, 44n32, 83, 87, 89, 92,
Bayraktar, 171–2 96–7; See also Britain/British,
BDH Barış ve Demokrasi Hareketi and role of military bases in
(The Movement for Peace and Cyprus
Democracy), 183 and NATO, 6, 32, 34, 54, 59, 76,
Berberoğlu, Ahmet Mithat, 124, 173, 109
175 and role of military bases in
BEY administration (Bayraktarlık Cyprus, 8, 24, 28, 32–4, 38,
[Military Chief in 62, 102; See also
Command]—Türk Elçililiği Britain/British, intelligence
Turkish Embassy—Yerel Yönetim and surveillance
(Local Government]), 171–2 and rule of Cyprus. See
bicommunality, 9, 11–12, 18, 33, 35, Britain/British,
37, 55, 61, 69, 78, 81n1, 89, 94, colonialism/rule of
96, 156, 163, 202, 204, 214, 241 and Russia, 68, 91
See also Constitution of 1960 and the United States, 24, 32, 38,
big bourgeoisie, 135, 137–8, 140, 83–98, 133n2
149–50 British imperialism, 1, 3, 23–4, 33,
Bil, Hikmet, 125–6, 133n6 83, 85–6, 94–7
bizonal bicommunal federation, 9, 12, changing priorities and interests, 33
94, 96, 156, 163, 241 and Cyprus, 1, 3, 23–4, 33, 83,
border, 28, 67, 195, 218, 222, 244 85–6, 94–7
dialect, 67–82 Double union (∆ιπλή ένωσ ις ),
borderline, 61, 80–1 33
Boyner, Ümit, 146 Enosis, 86
INDEX 283
in Greece, 3, 23, 33, 85–6 politics, 52, 69

in Middle East, 24, 33, 85, 96 revolts, 68, 71, 152
narrow and broader views of, Clerides, Glafkos, 113, 159, 161, 165,
33 185–9
and Partition, 33, 86, 96–7 Coexistence, 8, 49, 54, 79, 102, 155,
and Soviet Union, 86, 96 171, 173, 201, 203–5, 207–10,
and Turkey, 3, 23, 33, 97 214
underwritten by the United States, Cold War, 24, 32–3, 35, 38–9, 54–5,
32 75, 87, 91, 95–6, 137, 219
and the United States, 83–97 colonialism, 32–3, 54
decolonization, 75
Campaign, ‘From the Turk to the post–, 24, 33, 35, 38–9, 95–6
Turk,’ 129, 131 Committee of Cypriot Trade Unions,
Castro in a cassock, 33 170
See also Cuba of the Mediterranean Communism, 1–2, 8, 34, 37, 45n44,
center-right. See Left, Greek-Cypriot 64n7, 70–6, 78, 81, 87, 89, 96,
Central Intelligence Agency (CIA), 101, 110, 126–7, 151–68,
45n44 169–70, 173, 175, 189
central powers, 100 Communist Party of Cyprus
China, Peoples Republic of, 26, 91 (KKK Koµµoυνισ τ ικ ó K óµµα
Christofias, Dimitris, 12–15, 20n28, K ύπρoυ), 53, 101, 151–3, 155,
35, 43n18, 156, 159, 163, 166, 170
183, 188, 190, 193–7 conflict resolution, 4–5, 48
Church, 8, 20n24, 37, 49–50, 52–3, critiques of, 5
64n5, 69–70, 72, 82n6, 102–3, liberal approaches, 5, 48
125–6, 152, 155, 186, 205 consociationalism, 8–9, 34, 197
and class revolts, 70, 72, 82n6, Constitution of 1960, 8, 10, 34–5,
126, 152, 155 45n39, 112, 134n10, 159,
elections, 70 167n3, 172, 194
civil society, 59–60, 190, 202, 215n5 and accession of Cyprus to the EU,
atrophy of, 59 11, 13, 39, 79, 92–4, 137,
clientelist neocorporatism, 59 139–40, 144–5, 148, 158,
critique, 59 185, 190–1, 198–9, 218,
class: 222
analysis, 51–4 amendment of thirteen articles
contradictory to nationalism, 53, proposed in 1963, 35, 89
76, 227 and the Cold War, 35
ideological state apparatus, 53, 132, consociation, 8–9, 34, 197
140 Federal, 35
intercrossing with ethnicity/ formal state power, 34
nationalism, 53–60 See also bicommunality
interests, 5, 8, 48, 52–3, 96, 243; Coup of 1974, 7, 9–10, 16, 29, 33,
See also Althusser, Louis 35–6, 55, 64n7, 76, 80, 115,
mechanical and reductionist, 30–1, 172, 174–7, 180, 202, 219, 221,
52, 60 224–5
284 INDEX
Cuba of the Mediterranean, 2, global geopolitical/regional model,

33 48
See also Castro in a cassock; globalization, 41, 227, 237
Makarios III, Archbishop and Imperialism, 1, 3, 23–5, 33, 40, 48,
President of the Republic of 63, 83, 85–6, 94–7, 155–6,
Cyprus 172, 174
Cumhuriyetçi Türk Partisi [CTP] Left-wing nationalism, 10, 34n46
(Republican Turkish Party), Left-wing and right-wing
31n20, 78, 93, 145, 173–80, proponents, 5, 7, 10, 12–13,
182–3, 191–3 17, 76–7, 113, 159–61, 165,
Customs Union, 139 173, 175–8, 180–4,
Cypriot consciousness, 55, 75 185–99
Cypriot society, 49, 57, 59, 81–2n3, legalistic reading, 57, 65n16
119–20, 128, 132, 158, 161, Liberalism, 155, 157, 164
167, 169, 172, 183, 202, Marxist approaches, 57, 65n16
226 Middle East, 33, 96
border society, 218, 244 Nationalism, 12–13, 36, 50–1,
class analysis, 51–4 53–4, 59, 63, 65n10, 69–72,
class conflict, 47, 51, 59, 81 75, 79, 86–7, 113, 120, 155,
Federal solution, 93, 176, 178–9 163, 165, 169–70, 171–4,
migrant labor, 3, 18, 19n10, 179, 184, 186, 188, 191, 193
19n11, 219, 226–31, 241, NATO, 2, 6, 23, 28–9, 32–4,
244, 247n12 36–7, 39, 54–5, 59, 64n9, 76,
racialized boundaries, 227 87–91, 105, 107–11, 115,
racism, 13, 227, 241 176, 218
Turkish settlers, 38, 176, 189, 191, nature of, 31–2, 90, 97, 181
195, 220 Partition, 9, 16, 91, 96–7, 163,
Urbanization, 226 187, 195
Xenophobia, 18 political economy, 119–34, 135,
Cypriot sociological thought, 217–46
60 Proponents, 5, 7, 10, 12–13, 17,
Cyprocentrism, 72, 75, 78, 80, 76–7, 113, 159–61, 165,
81–2n3 173, 175–8, 180–4,
Cyprus conflict. See Cyprus problem 185–99
Cyprus conspiracy theory, 5, 31–2, Right-wing nationalism, 5, 45n46,
90, 97, 181 76–7, 113, 159, 165, 177,
critiques of, 5, 90 183, 191–2
discovery of hydrocarbons, 2, 13, Russia, 21n40, 26, 28, 35, 68, 81,
23–40, 244, 245 91, 228, 233, 245
Enosis, 8, 20n24, 20n27, 36, 72, Taiwanization, 195
82n4, 82n6, 86–8, 100–9, Turkey’s plan B, 6
111, 113–16, 153, 155–6, United Nations (UN), 6, 74, 95,
186 105, 125, 182, 218
ethnic conflict, 3–4, 40, 47–63, United States, 31–2, 90, 97
75 Western interest, 34, 87, 163
INDEX 285
Cyprus problem, 2, 4, 9, 12, 14, Democratic Union of Cyprus,

17–18, 23–46, 47–66, 79–80, 113
93, 95, 97, 104–5, 107, 109–11, Demographic engineering of Cyprus,
115, 137–8, 144, 149, 154–6, 174, 230–1
162–4, 166–7, 193, 195, 211, Demokratik Halk Partisi [DHP]
220, 222, 239 (Democratic People’s Party),
accession to EU, 11, 13, 39, 79, 176
92–4, 137, 139–40, 144–5, Demokratik Mücadele Partisi
148, 158, 185, 190–1, 198–9, [DMP](Party for Democratic
218, 222 Struggle), 177
Annan plan, 6, 9–10, 12, 16–17, Denktaş, Rauf, 11, 13, 16, 20n23, 93,
39, 91–7, 145–7, 163, 182–5, 124, 127, 129, 134n7, 134n8,
187, 189–90, 194–5, 201 138, 144–5, 174, 178, 181–2,
bizonal bicommunal federation, 186, 191, 200n3
9, 12, 94, 96, 156, 163, Denktaş, Serdar, 20n23, 177,
241 191–2
and Britain, 1, 7–8, 20n24, 23, dialectic of intolerance, 55, 59
31–3, 43n29, 49–51, 54, 59, Dış Ekonomik İlişkiler Konseyi [DEİK]
68–70, 72–4, 82n4, 82n6, (Foreign Economic Relations
85–6, 88, 99–101, 109, 114, Board), 148
116, 122–3, 127–31, 154, displacement of Cypriots, 107, 204–5,
167–8n3, 176 225, 229
and China, 26, 91 ∆ηµoκρατ ικ óς Συναγ ϵρµóς
class factors, 52 [DISY] (Democratic Rally), 156,
common sense approaches, 4 160, 163, 165, 185–90, 192–9
and conspiracy theory, 5, 31–2, 90, ∆ηµoκρατ ικ ó K oµµα [DİKO]
97, 181 (Democratic Party)
constitutional conflict, 11, 15, 35, Confederation, 176
45n39, 54, 89, 114, 188, 192, division in Cyprus:
195 by ethnicity, 48, 54–5, 78, 154,
geopolitics versus ethnic conflict, 3, 199
40, 48, 74, 199 of the island, 2–3, 9, 63, 86,
holistic reading, 4, 63 89–90, 95, 97, 174–5, 178
national question, 32–6, 48–56, doctrine of necessity, 9–10, 61–2,
81, 119 66n26
postcolonial quasi-stateness, 47, apologist-types of studies, 61–2,
66n21 66n26
solution/resolution to, 2, 5, 9–10, critiques, 61–2
12–14, 18, 23, 27, 31, 33, Supreme Court, 9, 61–2
38–49, 55, 62, 76, 79, 88, 90, DP Demokrat Parti (Democrat Party),
92–3, 95, 97, 104, 106–22, 178–9, 191–2
113–16, 126, 137–8, 142–6, dual or double enosis or union
154, 163, 172–3, 175–80, (∆ιπλή ένωσ ις ), 107, 109,
182–3, 196, 203, 207–13, 111, 115
220, 224, 239–41 Durduran, Alpay, 175
286 INDEX
Ecevit, Bülent, 45n46, 144 Elections, 13–14, 17, 20n34, 103–5,

Economic crisis, 3–4, 12, 15, 17–18, 159, 162, 164, 166, 192, 194,
23–4, 29, 37, 71, 137–8, 152, 198–9
166, 217–21, 228, 231, 234, for Archbishop, 103–5
238, 240, 241, 243, 245 Engin, Oktay, 126
Economy, 3, 16–18, 19n10, 19n11, Enosis, 8, 20n24, 20n27, 36, 72,
19n13, 21, 34, 40, 49, 69, 72, 82n4, 82n6, 86–8, 100–9, 111,
79, 119–34, 140, 142–3, 150n3, 113–16, 153, 155–6, 186
217–47 EOKA B, 35, 38, 64n7, 185,
accumulation by dispossession, 225 206
banking crisis, 16–17, 150n3, 236; Eθ νικ ή Oργ άνωσ η K υπρίων
See also Economy, risks of the Aγ ωνισ τ ών [EOKA] (National
banking system Organization of Cypriot
border economy, 218 Fighters), 8, 20n24, 27, 35, 55,
cheap labor model, 228–31 88, 105–9, 111, 113, 125
competiveness, 140, 233–45, 237 Erdoğan, Recep Tayyip, 182
consumption driven, 234–9 Erel, Ali, 192
debt crisis, 16 Erkurt, Ahmed Sadi, 171
demographic engineering in Eroglu, Derviş, 13, 171, 177, 183,
northern Cyprus, 174, 230–1 191, 193
development, 34, 40, 69, 72, 79, Ertuğruloğlu, Mehmet, 125
217–47 Ethnarchy, 52, 100–16
economic miracle, 217–47 Council, 102
Euro-crisis and Cyprus, 18 ethnicity, 48, 53–60, 78, 154, 199
export driven economy, 234–9 ethnic/national conflict/struggles,
financialization, 234–9 3–4, 40, 47–63, 74–5, 199
of Greece, 3, 16–18, 69, 72, 119, Europaiko Komma [EUROKO]
129, 219, 228, 230, 236, 238, (European Party), 188–9, 195,
245 197
internal devaluation, 236–7, 246 European Court of Human Rights
mass tourism model, 226, 234, 242 (ECtHR), 20n30
migrant labor, 3, 18, 19n10, European Economic Community
19n11, 219, 226–31, 241, (EEC), 138–9
244, 246n12 European Union (EU), 4, 6, 9–18,
political division, 119–34 26–9, 36–9, 60, 80, 91–5,
precarious labor, 3, 19n21, 219, 135–49, 150n4, 158, 180–3,
230, 234, 244 218–20, 222, 228–33, 236,
risks of the banking system, 245–6, 246n6
234–47; See also Economy, Presidency, 13–14, 27
banking crisis Eνιαία ∆ηµoκρατ ικ ή Éνωσ η
sustainable model of economic K έντρoυ [EDEK] (United
development, 239, 241–4 Democratic Union of the
tourism, 19n13, 49, 79, 142–3, Centre), 15, 20n35, 43n18,
218, 220, 225–6, 228, 233–4, 62–3, 64n7, 193, 195–7,
242 199
INDEX 287
Eνιαίo 8ηµoκρατ ικóó M έτ ωπ o control by, 6, 8–11, 15, 19n20,

Aναδηµιoυργ ίας [EDMA] 20n24, 26–7, 29–30, 33–8,
(The United Democratic Front 45n40, 45n41, 46n49, 52, 55,
for Re-creation), 113 59, 88–9, 94–7, 100, 106,
Evkaf, 121–2, 124, 129–30, 132 108–15, 131–2, 134n8,
Eνιαία ∆ηµoκρατ ικ ή Oργ άνωσ η 169–84
N εoλαίας [EDON] (United intelligentsia, 53, 59
Democratic Youth Organization), Left, 7–8, 10–13, 15, 17, 29–30,
162 32, 52–3, 55, 60, 70–5,
Eνωµένoι ∆ηµoκρ άτ ες [EDY] 77–81, 93–4, 102–4, 108–9,
(United Democrats), 15 154–5, 161–4, 167, 183,
189–90
Famagusta, 85, 129, 142, 147, 202, working class, 69–70, 101–2,
211 120–1, 149–67, 169–84
Foot, Hugh, 110 Grivas, Georgios, 64n7, 105–6,
Foot Plan, 111 109–13, 210
guarantor nations, 8, 55, 76, 80,
Geopolitical, 1–2, 4–6, 12, 18, 112
23–40, 48, 56, 67–9, 73, 75–6,
80–1, 86–7, 91, 136, 152, 244
conflict, 4–6, 48, 73, 76 Halil, Ibrahim Akça, 148
İmperialism, 23–40, 86–7 Halk Der Halkla Dayanışma ve Kültür
global factors, 40 Derneği (Association for Culture
globalization, 41n3, 226, 237 and Solidarity with the People),
Governor of Cyprus. See Harding, Sir 173
John Halkın Sesi Newspaper, 123
Gramscian approaches, 41n2, 41n3, Hannay, Sir David, 11
60, 136, 154 Harding Plan, 106–9
Gramsci, Antonio, 49, 60, 62, 65n19, Harding, Sir John, 106–9, 126
65n20, 136, 154 Hegemonic, 6, 12, 28, 31, 37, 41,
Greece, 3, 6, 8, 10, 15–18, 20n24, 53, 70, 72, 77–9, 85, 91,
20n25, 23, 27, 30, 33, 36–8, 135–6, 138, 140, 144, 150,
43n20, 45n43, 45n44, 53–6, 174, 179, 214, 241
64n7, 64n9, 69, 72, 76–7, 80, fraction, 37, 41, 53, 136, 140,
85–90, 92, 99, 101–5, 107–8, 144
110–15, 119, 129, 146, 155, Project, 6, 78–9, 136, 138,
162, 169, 186, 219, 228, 230, 140
236, 238, 245 Hellenic nationalism, 50, 169
Greek- Cypriot, 6, 7–15, 17, 19n20, Helsinki Summit of 1999, 139,
20n24, 26–7, 29–30, 32–8, 144–9, 180
45n40, 45n41, 46n49, 52–5, 57, High Level agreements of 1977 and
59–60, 62, 65, 69–81, 86–9, 1979, 9
93–7, 99–106, 108–9, 120–1, Hisarcıklıoğlu, Rifat, 146
126–8, 131–2, 134n8, 149–67, Holbrooke, Richard, 91–3, 95–6
169–84, 189–90 hydrocarbons, 2, 13, 23–40, 244,
bourgeoisie, 9, 50, 52, 64n7 245
288 INDEX
immigration issue, 39, 222, 228 Karamanlis, Konstantinos, 186

Imperialism, 1, 3, 23–5, 33, 40, 48, Karpasia, 192
63, 83, 85–6, 94–7, 155–6, 172, Kasoulides, Ioannis, 187, 194–6
174 Kavazoğlu, Derviş Ali, 171
articulation of interests, 18, 32n8, Kaymak, Faiz, 123–4, 126–7, 130
48–9, 52–3, 136, 155 Kemal, Mustafa Atatürk (Kemalist),
China, 26, 91 39, 50, 65, 78, 169
of Cyprus, 1, 3, 23–4, 33, 83, Kıbrıs Adası Türk Azınlığı Kurumu
85–6, 94–7 [KATAK] (Turkish Minority
de facto partition, 9, 16, 31, 34, 55, Institution of the Island of
89, 90–1, 222, 239–40, 242 Cyprus), 123, 133n3, 133n4
dependency theory, 41n3 Kıbrıslılar Öğrenim ve Gençlik
discovery of hydrocarbons, 2, 13, Federasyonu [KÖGEF] (Cypriots
25, 27, 29–30, 40, 244 Federation of Education and
Disraeli, Benjamin, 85, 96 Youth), 173
global capitalism, 41, 140 Kıbrıs Türk Birliği (Istiklâl) Partisi
Western political system, 70, (Turkish Cypriot Union
92–3 [Independence] Party), 123, 129
See also British imperialism
Kıbrıs Türk İşadamları Derneği [İŞAD]
Import Substitution Industrialization (Cyprus Turkish Businessmen
(ISI) Model, 137 Association), 145
Independence, 5–9, 18, 23, 32–4,
Kıbrıs Türk İsçi Birlikleri Kurumu
36–7, 45n41, 52–6, 59, 64–5n9,
[KTIBK] (Organization of
72, 75–8, 80, 88, 91, 99–117,
Turkish Cypriot Workers’
133n2, 142, 150n6, 155,
Unions), 171
167–8n3, 172, 243
Kıbrıs Türk Kurumları Federasyonu
guaranteed, 23, 36, 55
(Turkish Cypriot Institutions
limited, 34
Federation), 123
post-colonial, 23, 133n2
Kıbrıs Türk Ticaret Odası [KTTO]
İnönü, İsmet, 122
(Turkish-Cypriot Chamber of
International Monetary Fund (IMF),
Commerce), 140, 145–6
15, 21n42, 137, 148
Kıbrıs Türktür Derneği (Cyprus Is
Ioannides, Polykarpos, 108
Turkish Association), 125–6
Iran, 14, 17, 28–9, 32
Iraq, 29, 44, 91 Kıbrıs Türktür Partisi (Cyprus Is
Turkish Party), 125, 128
Israel, 6, 17, 25, 28–31, 40, 42n9,
42n16, 43n18, 43n19, 46n49, Kissinger, Henry, 34, 44n36
190 Kormakitis, 192
Istanbul Kıbrıs Türk Talebe Cemiyeti Kosmas, General Georgios, 105
[IKTTC] (The İstanbul K oµµoυνισ τ ικ ó K óµµα K ύπρoυ
Association of Turkish-Cypriot [KKK]. See Communist Party of
Students), 172 Cyprus
İstanbul Ticaret Odası [İTO] (Istanbul Küçük, Fazıl, 122–4, 126, 129, 131,
Chamber of Commerce), 133n3
145 Kurdish question, 39
INDEX 289
Kuzey Kıbrıs Genç İşadamları Derneği middle class, 7, 19n22, 50, 71, 154,
[GİAD] (North Cyprus Young 192, 203
Businessmen’s Association), 145, Middle East, 6, 17, 24–49, 33, 40,
176 44n32, 69, 76, 85, 87–9, 91–2,
Kyrenia, 103–4, 108, 110, 113, 202, 96, 218, 245
209, 211–12 migrants/migration, 3, 18, 19n10,
19n11, 219, 226–31, 241, 244,
Labor, 7, 43–4n29, 51, 65n20, 73, 246n12
94, 120–1, 132, 138, 158, 218, Milliyetçi and Halkçı Birlik
220, 225–7, 237–8, 240–2, 244 (Nationalist and Populist Unity),
aristocracy, 7 123
cheap labor model, 228–31 Müezzinoğlu, Ziya, 141–2
migrant, 3, 18, 19n10, 19n11, 219, Münir, Sir Mehmet, 121
226–31, 241, 244, 246n12 Mustafa Ibrahim Case, 20n26, 64,
precarious, 3, 19n21, 219, 230, 66n23
234, 244 Müstakil Sanayici ve İşadamları
Larnaca, 21n46, 202, 208, 211 Derneği [MÜSİAD]
Latins, 8 (Independent Industrialists and
Lausanne Treaty, 36, 169 Businessmen’s Association), 139
Left, Greek-Cypriot, 7–8, 10–13, 15,
Nalbantoğlu, Burhan, 124, 127
17, 29–30, 32, 52–3, 55, 60,
Nationalism, 12–13, 36, 50–1, 53–4,
70–5, 77–81, 93–4, 102–4,
59, 63, 65n10, 69–72, 75, 79,
108–9, 154–5, 161–4, 167, 183,
86–7, 113, 120, 155, 163, 165,
189–90
169–70, 171–4, 179, 184, 186,
Lilliputian states, 2–3, 47
188, 191, 193
Limassol, 79, 101, 202
NATO, 2, 6, 23, 28–9, 32–4, 36–7,
Luxembourg Summit, 139, 143
39, 54–5, 59, 64n9, 76, 87–91,
105, 107–11, 115, 176, 218
Macmillan, Harold, 126 See also Imperialism, British
Macmillan Plan, 111, 115, 126 imperialism
Makarios II, Archbishop, 104 natural gas, 23, 25–6, 41n6, 43n19,
Makarios III, Archbishop and 245
President of the Republic of Necati, Özkan, 122–4, 133n3, 133n5
Cyprus, 19n7, 20n27, 33, 37, 53, Neofytou, Averoff, 187
64n7, 76–77, 88, 90, 104–11, Neoliberal, 7, 17, 36, 218, 241–2, 243
113–14, 159, 161, 165, 189 Nicosia, 37, 42n9, 76, 79, 89, 102,
Manyera, Niyazi, 129 106, 109–10, 113, 121–3, 128,
Mari explosion, 14, 166, 199 133n3, 133n4, 134n8, 170, 172,
Maronites, 8, 186, 192, 196 181, 202, 209–10
Mason–Dixon Line in Nicosia, 128, Non-governmental Organization
134n8 (NGO), 208
mass movement/mass mobilization,
7–8, 13, 74, 76, 78–80, 105, occupation of Cyprus, 10, 29, 37, 50,
125, 127, 153, 221, 225 86, 88, 91, 95, 121, 158, 214, 225
Menderes, Adnan, 125–6 October Revolution, 101
290 INDEX
Octovriana, 8 100–1, 103–4, 107, 109, 112,

Önal, Kamil, 125–6 114, 163, 173–4, 177, 181, 189,
Oργ άνωσ η Eργ oδoτ ών και 219–21
Bιoµηχ άνων [OEB] (Cyprus post-Cold War, 24, 33, 35, 38–9,
Employers and Industrialists 95–6
Federation), 146 See also Cold War
Örek, Osman, 124, 129 post-colonialism, 1, 33, 35, 38–9,
Orthodox Church/Christians, 49, 69, 82n6, 95–6
72, 86, 125, 196, 245 Poulantzas, Nicos, 61, 65n17, 65n19,
Orthodox Synod, 101 136, 140, 149n1
Ottoman Empire, 31, 36, 49, 54, power bloc, 31, 135–49, 149–50n1
64n4, 67–9, 85, 99–100, 116,
169 race/racism, 86, 209, 227
Özal, Turgut, 38 Radcliffe Plan, 108
Özersay, Kudret, 193 reconciliation, 2–3, 11, 18, 59, 201,
Özgür, Özker, 178–80 224
regional factors, 2, 18
Palestine, 87 reunification of Cyprus, 2, 11, 13, 16,
Papadopoulos, Tassos, 11–12, 20n28, 18, 19n20, 20n35, 80, 93–5,
45n44, 159, 162–3, 165, 190, 154, 163–4, 185, 189–90,
194–9 192–4, 197, 199, 201, 207, 209,
Papagos, Alexandros, 104, 125 217–47
Papandreou, Georgios, 37 Right, 7, 12–13, 20n23, 20n24, 32,
parliamentary elections, 18, 113, 156, 45n46, 52, 64n6, 74–7, 79,
177–8, 182–3, 192 82n6, 102–4, 108, 113, 156,
partial approach, 172 159–65, 168n7, 176–8, 181,
Partition, 5, 8–9, 16, 31, 33–4, 38, 183, 185–6, 188–96, 198–9,
45n41, 55, 59, 82n6, 84, 86, 200n1
89–91, 96–7, 98n5, 107, 109, Rızkı, Ziya, 176
111, 114–16, 126, 163, 169, Roma, 8, 20n25
171–2, 174, 187–8, 195, 218, Russia, 21n40, 26, 28, 35, 68, 81, 91,
222, 239–40, 242 228, 233, 245
See also Taksim
passive resistance, 110 Sabancı, Sakıp, 142
passive revolution, 6, 39 Sanayi Odaları Birliği (Union of
Πανγ κ ύπρια Eργ ατ ικ ή Chambers of Industrialists),
Oµoσ πoνδία [PEO] (Worker’s 142
Federation of Cyprus), 51, 64n6, Security, 11, 14, 24–6, 31, 35, 38, 40,
162, 170–1, 237 42n8, 88, 91–2, 94, 97, 107,
peasant(s), 49–50, 67–8, 71, 121, 110, 112, 143, 181, 222, 239
152–3, 182, 203 self-determination, 10, 20n24, 55,
revolts, 67–8, 71 88–9, 103–11, 114–15, 125–6,
pipeline geopolitics, 26 133n2
population, 3–4, 8, 37, 39, 45n40, settlers, 3, 38, 176, 189, 191, 195,
49–50, 53, 68, 75–7, 86, 89, 220
INDEX 291
Συνoµoσ πoνδία Eλλήνων Talat, Naci, 173, 179

Bιoµηχ άνων [SEV] (Hellenic Tanrısevdi, Kemal, 127
Federation of Entreprises), 146 Tanzimat reforms, 68
Social: Tara, Sarık, 142
Banditry, 69 Toplumcu Kurtuluş Partisi [TKP]
Formation, 1, 6, 25, 35–6, 40, (Communal Liberation Party),
41n3, 48 175–8, 181, 183
Movement(s), 68, 79, 101, 135 trade unions, 7, 17, 20n24, 54, 64n6,
Transformation, 58, 60, 187, 192, 71, 73–4, 78, 80, 101–2, 108,
201, 226 125–6, 128, 135, 139, 145,
Soviet Union [USSR], 38, 73, 86–7, 152–3, 167n2, 170–1, 219, 225,
90, 92, 96, 133n12, 152, 167, 241
173, 175, 177–9 traditional coexistence, 54
See also Russia Treaty of Alliance, 8
Spaak, Paul-Henri, 111 Treaty of Establishment, 8, 32, 89
Special War Department (Özel Harp Treaty of Guarantee, 8
Dairesi)169 TRNC (Turkish Republic of
State: Northern Cyprus), 3, 6–7, 9–10,
authoritarian statism, 61 12, 16, 20n23, 27–8, 35, 57–8,
Gramscian approaches, 41n2, 62, 91, 93, 95, 142–3, 146, 148,
41n3, 60, 136, 154 150n9, 176, 178–80, 183, 187,
Gramsci, Antonio, 49, 60, 62, 194, 209–10, 218, 224, 230–1
65n19, 65n20, 136, 154 troika, 15
Marxist or class-analytic Turkey, 3–12, 16–18, 19n20, 23,
approaches, 41n3, 59, 98n1 26–31, 33, 36, 40, 43n19,
organization-analytic approaches, 43n23, 50, 53–5, 57–8, 62, 63,
57 65n20, 69, 76–80, 87–93, 97,
postcoloniality, 59 98n5, 100, 103–4, 107–9,
rational-legal paradigm, 60 111–12, 114–16, 119–20,
state-centered approach, 135–6, 124–7, 129–32, 134n8, 135–50,
150n2 169–84, 185–99, 218, 220,
state of exception, 10, 37, 61–2, 230–1
66n26 Cyprus policy, 135–50
See also doctrine of necessity independence, 6–9, 18, 36–7, 55,
Stylianides, Christos, 199 59, 75, 88, 110–11, 150n6,
subaltern classes, 6, 60, 97 172, 176, 191
Suez Canal, 69, 81 intervention/invasion in Cyprus, 7,
16, 76–7, 80, 105, 141,
Tahsin, Arif Hasan, 133n3, 172 175–6, 178, 191, 193
Taksim, 8, 126, 128, 131, 134n7, partition, 5, 8–9, 16, 31, 33–4, 38,
134n8, 169–70, 173 45n41, 55, 59, 82n6, 84, 86,
See also Partition 89–91, 96–7, 98n5, 107, 109,
Talat, Mehmet Ali, 12, 20n35, 145, 111, 114–16, 126, 163, 169,
178–80, 182–3, 191–2, 196, 171–2, 174, 187–8, 195, 218,
246n5 222, 239–40, 242
292 INDEX
Turkish-Cypriot, 6, 13–18, 19n20, Ulusu, Bülent, 142

20n30, 20n31, 20n35, 21n45, United Nations (UN), 6, 9, 11–14,
21n46, 27, 29, 35, 37–8, 42n14, 33–4, 39, 42n16, 74, 93, 99,
45n40, 45–6, 46n49, 50, 52–5, 104–5, 108–10, 125, 144–5,
57, 59–60, 62, 65n11, 65n20, 163, 182, 187, 190–1, 194, 197,
70, 75, 77–80, 87–90, 94–7, 215n6, 218–19
100–1, 105–6, 109, 111–12, United States (USA), 3, 24, 26, 28,
114–16, 119–34, 138, 140–1, 30–6, 38–9, 64n9, 83–97, 133n2
147–9, 153, 155, 159, 169–84, conflicting foreign policy goals on
185–200, 201–3, 207–12, 214, Cyprus, 34, 83–97
215n6, 221–4, 230, Cyprus problem, 24, 26
240–1, 243–4, 245, 246n5, hydrocarbons, 24, 26, 28, 30, 36,
246n6 38–9
Left, 7, 12–13, 17, 30, 32, 52, Imperialism), 3, 24, 33, 86, 94–7
77–80, 82n6, 169–84, USSR. See Soviet Union [USSR];
191 Russia
Türkiye İşçi Partisi [TİP]
(Workers’ Party of Turkey), Varosia (Maraş), 147
172 Vasiliou, George, 159, 162
Türkiye Odalar ve Borsalar Birliği Volkan, 106
[TOBB] (The Union of Vuruşkan, Rıza, 127
Chambers and Commodity
working class, 50, 54, 70–1, 74, 78,
Exchanges of Turkey),
137, 152, 154, 160, 170–1, 203,
139–41, 144–6,
226–7, 243
148
World Bank, 137
Türkmen, Ilter, 176
Türk Mukavemet Teşkilati [TMT] Yahya, Ahmet, 171
(Turkish Resistance Yavuz, Faik, 146
Organization), 88, 106, 124–5, Yugoslavia, 198, 213
127–8, 132, 134n7, 141, 169,
175, 206, 210 Ziartides, Andreas, 170
Türk Sanayicileri ve İşadamları Derneği Zorlu, Fatin Rüştü, 126–7
[TÜSİAD] (Turkish Zurich–London Agreements, 8, 34–5,
Industrialists’ and Businessmen 45n41, 64–5n9, 99, 109, 112,
Association), 140 116, 126–7, 129, 131

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Beyond a Divided Cyprus

A State and Society in Transformation

Edited by Nicos Trimikliniotis and Umut Bozkurt

First published in 2012 by

Palgrave Macmillan is the global academic imprint of the above

Palgrave® and Macmillan® are registered trademarks in the United

ISBN 978-1-349-34153-5 ISBN 978-1-137-10080-1 (eBook)

Library of Congress Cataloging-in-Publication Data

Beyond a divided Cyprus : a state and society in transformation /

A catalogue record of the book is available from the British Library.

Design by Integra Software Services

First edition: November 2012

Introduction: A Political Economy Perspective

as the “Cyprus economic miracle.” The economically stronger Republic

Economic Overview: A Divided Economy

settlement.3 Yet there is a “mini Cold War” in what the UN described

Asymmetrical and de facto Divided Economies Compared:

Table 12.1 Basic features of Cyprus economy for 2008

Population 1,071,300 GCCa 74.4 percent TCCb 25.6 percent

Source: Economic Interdependence in Cyprus, Main findings and recommendations,

discontent amongst trade unions and community groups leading to mass

abandoning the long-term opposition to Greek-Cypriot and Turkish-

Table 12.2 Economic interdependence between Greek-Cypriots (GC) and Turkish-

2003 2004 2005 2006 2007 2008 2009

Source: Economic Interdependence in Cyprus project supported by UNDP-ACT and USAID.

Life after the “Economic Miracle”

were reminiscent of the early industrialization of western Europe. This

Moreover, the processes of tertiarization, the transformation of family

“a significant number of households responded to the growing demand for

In any case, a serious rethinking is required to appreciate the economic

Migration and the Cheap Labor Model: Growth

A crucial factor that extended the life-line of the accumulation regime

Table 12.3 Migration movements, 2000–2010, in the RoC

Year Total immigrants Total emigrants Net migration Net migration

2000 12, 764 8, 804 +3960 +5, 7

Table 12.4 Employed non-Cypriots in the RoC

Year 2005 2006 2007 2008 2009 2010

EU citizens 23,558 16,838 30,482 42,630 48, 793 53, 875

Numerous studies illustrate the contribution of migrant workers to the

who do not. Studies and reports on migrant workers point to structural

Demographic Engineering and Super-exploitation

The migration issue in the northern part of the country is closely

From Slowdown to Crisis: The RoC GDP

Figure 12.1 GDP growth, 1996–2012

Figure 12.2 Unemployment rate (percentage), 1995–2011

Figure 12.3 Current account deficit as percentage of GDP

Tourism and Competitiveness

geographical orientation of sales etc. As a result of the wrong strategy

Financialization: From an Export-Driven

in what we refer to as the high road to competitiveness (see Ioakimoglou,

Debt and Exposure to Risks of the Banking System

Figure 12.4 Real wage and private consumption

economy is now in a process of adjustment with falling real wages and

The High Road to Competitiveness

Table 12.5 Determinants of structural competitiveness

International trade Export industrial specialization, geographic orientation of

oriented economic sectors is urgently needed in order to shield the econ-

and to use services related to product marketing and trading, accounting,

Sketching Out a Different Path of Development

aspects of the economy. However, it is essential to consider the parame-

Alternatives: Sketching Out a Different Path of Development

political economy perspective, although it ought to draw on ideas and

Development and Sustainability