ROUND TWO DEALS TO DETERMINE ULTIMATE VICTOR

UNCLAS SECTION 01 OF 02 NICOSIA 000114

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: PGOV PREL CY
SUBJECT: ROUND TWO DEALS TO DETERMINE ULTIMATE VICTOR


1. (SBU) Summary: The February 17 first round of Cypriot elections
will narrow to two the list of contenders but simultaneously make
the third-place party a potential kingmaker. Current polling on
second round scenarios is next to worthless, since the final result
will depend more on party leaders' negotiations than on
rank-and-file voters' decisions. Once results are announced late
February 17, the winners immediately will launch a campaign to
recruit the third-place finisher's supporters into their respective
camps. The third-place candidate and his collaborators must take a
stance that both serves their and their parties' longer-term
interests, but also resonates with their supporters, who could
easily spurn the higher-ups to vote with their conscience. For the
first time ever, there is an (albeit slim) prospect that two
ideological enemies, right-wing DISY and Communist AKEL, will join
forces to battle incumbent Tassos Papadopoulos in the February 24
second-round, should DISY-supported candidate Ioannis Kasoulides
fail to advance. Papadopoulos already is taking action to foil such
negotiations. End Summary.

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Losers Turn Into Kingmakers But Choices Are Hard
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2. (U) The first round of the presidential elections on February 17
will send home one of the three principal presidential contenders.
As soon as results emerge, however, an entirely new campaign will
commence, its outcome decided both inside smoke-filled rooms and in
the public domain. The excluded candidate and the party or parties
nominating him ultimately may decide the victor of this race,
provided they can persuade their supporters to follow their lead.
In all previous Cypriot presidential elections, the choice was
fairly simple: support was given to the highest bidder -- i.e., the
candidate who offered the biggest share of ministerial posts in the
new government, and other similar benefits in the wider public
sector. In this election, the leaders' priorities will be to ensure
their parties' and their own political futures.


3. (SBU) The 2008 race is different in another way. For the first
time, there is a prospect of cooperation between right-wing DISY and
left-wing AKEL, driven by their common desire to prevent Tassos
Papadopoulos' reelection. Both parties emerged from Papadopoulos'
five-year reign weaker and fear that his renewed mandate would push
them further downhill. Moreover, the two parties share the view
that the current administration's policies are leading the country
to partition. Both parties face difficulties in convincing their
respective memberships to abandon decades of indoctrination about
the other's evilness, however. And preempting their collaboration is
Papadopoulos's most-urgent second-round priority.


4. (SBU) Party leaders and the candidates themselves are loathe to
discuss deal specifics, and speculation over how each camp might
move is rife. DIKO chief Marios Karoyian told the Ambassador
February 14 "it is not appropriate to start discussions now," but
admitted the party already had plans developed to recruit
second-round allies. Kasoulides had focused on the prospect of DISY
not advancing in his day-earlier meeting with us, calling the
subsequent decision to back Papadopoulos or Christofias "a party
nightmare."

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Scenario 1: Papadopoulos vs. Christofias
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5. (SBU) This is the most debated scenario, since most polls put
the incumbent and Communist challenger 1 - 2, respectively. What
will DISY do in this scenario? Various Embassy contacts revealed
that party leader Nikos Anastassiades and most of the top ranks are
determined to support Christofias. They are considering two
options, both involving convocation of an extraordinary party
congress. In Option 1, Anastassiades would lobby for a formal
congress decision backing the AKEL candidate. If the party
leadership considered such a move detrimental to its long-term
interests, they instead would pass a "vote your conscience" motion,
but work for Christofias behind the scenes. Anastassiades allegedly
would receive Christofias's then-vacant House Speaker seat as
payback, plus other unspecified spoils. A formal AKEL-DISY joint
government is inconceivable, since its establishment would produce
large defections from both parties. Of late, however, many in DISY
are discussing the possibility of a "national unity" government,
complete with figures across the political spectrum, as a way of
disguising AKEL-DISY cooperation.


6. (SBU) Papadopoulos has already put in motion a plan to preempt
either an overt or undercover collaboration of the two parties. To
do so, he is resorting to an oft-used "weapon," his 2004 rejection
of the Annan Plan reunification effort. After a right-wing trade
union federation criticized possible AKEL-DISY collaboration,
Papadopoulos and lieutenants let loose a misinformation barrage,
alleging that the parties were conspiring to get rid of Papadopoulos
in order to revive the UN plan. Close Papadopoulos confidants also
claim that certain DISY officials will seek to undercut

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Anastassiades by announcing, immediately upon word that Kasoulides
had failed to advance, their support for the President.

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Papadopoulos vs. Kasoulides
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7. (SBU) This is Papadopoulos's favorite scenario, as most experts
believe AKEL could never support a right-wing candidate. AKEL
adamantly refuses to discuss what the party would do if faced with
this dilemma, other than follow the prescribed procedure of calling
a meeting of party leaders to consider options. An AKEL insider
confessed, however, that AKEL could never back Kasoulides.
Papadopoulos's camp believes that, even without official AKEL
support, the majority of leftist voters will opt for a centrist
candidate or not vote at all.


8. (SBU) Despite the apparent difficulties, DISY leaders remain
optimistic that AKEL cannot accept an invitation to return to the
same government it abandoned in July 2007. One insider further
argued that AKEL faced difficulties convincing its rank-and-file to
join forces with nationalist EUROKO, another member of
Papadopoulos's coalition. More importantly, the reasons that forced
AKEL to dissolve the partnership, namely the party's declining
electoral fortunes and the current stalemate in the Cyprus issue,
remain valid. Yet the likelihood of AKEL openly supporting a DISY
candidate seems a bridge too far, even under the guise of a national
unity government.

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Christofias vs. Kasoulides
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9. (SBU) This would be the most straightforward race, with both
winners offering the loser power-sharing arrangements. DIKO
considers Papadopoulos's exclusion inconceivable, however, as nearly
every poll has put him in first place; party contacts therefore have
refused to discuss this eventuality with us. Opinions within AKEL
and DISY vary as to what DIKO will do. AKEL believes the long
history of cooperation between two parties bodes well for future
cooperation. It envisages a power-sharing arrangement not unlike
that which existed before July, with AKEL, DIKO, and EDEK dividing
the ministries. "Only the name of the president will change,"
revealed one AKEL official.


10. (SBU) DISY officials consider AKEL's assumptions incorrect.
Both DIKO and EDEK will support Kasoulides if Papadopoulos fails to
advance, they argue, attributing this outcome to the current DIKO
leadership's strong anti-AKEL and anti-Communist sentiments.
Moreover, DISY believes that the prospect of an AKEL-dominated
government, which is bound to absorb most of the leftist vote,
represents EDEK's worst nightmare.

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Comment
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11. (SBU) If excluded from the runoff, AKEL and DISY will be faced
with two bad choices: supporting the incumbent after several months
of disparaging his Cyprus problem policy as a recipe for partition,
or lending support to their respective ideological enemy and risk
splitting their own parties. Finding a middle-way solution such as
an agreement to form a government of national unity that will make a
Cyprus solution its top priority might prove a win-win situation for
the two. Cooperating with AKEL is no longer inconceivable for many
in DISY, and some loyalists argue that cooperation is imperative
both for electoral success and to improve chances of an eventual
CyProb settlement. AKEL seems unprepared to dance to DISY's lead at
this juncture, however.

SCHLICHER