NORTH CYPRUS BUSINESSMEN TAKE 'WAIT AND SEE'

C O N F I D E N T I A L NICOSIA 000695

SIPDIS

E.O. 12958: DECL: 11/05/2019
TAGS: ECON PREL CY
SUBJECT: NORTH CYPRUS BUSINESSMEN TAKE 'WAIT AND SEE'
APPROACH TO REUNIFICATION

Classified By: Ambassador Frank Urbancic for reasons 1.5 b and d


1. (SBU) The new president of the Turkish Cypriot Chamber of
Commerce (TCCC),Gunay Cerkez, told us that his organization
would not campaign either in favor or against any referendum
on the island's reunification. This is in stark contrast to
the 2004 referendum in which the TCCC actively campaigned for
a "yes" vote with Chamber members appearing on TV and radio
and making speeches explaining the economic benefits that
would accrue to Turkish Cypriots in a reunified Cyprus.


2. (C) Cerkez is one of north Cyprus' leading businessmen
with interests in mobile telephony, tourism, and
construction. He is also a long-time participant in
bi-communal efforts working for resolution to the island's
division, having participated, for example, in the "Brussels
Group" which brought business leaders from both communities
together before the Green Line crossings were opened. This
time, however, Cerkez sees no advantage for his organization
in playing an active role if the referendum stage is reached.
"What did it get us last time? Nothing but criticism for
believing the Greeks would be reasonable and that the EU
would treat us fairly. If individual Chamber members want to
campaign, that's fine, but as an organization we will remain
neutral." Cerkez agreed that reunification would be a huge
boost to the ailing north Cyprus economy, but he is extremely
doubtful things will get that far. "The Greeks have
everything, EU membership, their own fully-recognized state
that they don't have to share with us, and a feeling of moral
superiority. Unless the U.S. and EU put pressure on them, the
Greeks will not negotiate in a way that will reach a
solution."


3. (C) These points were echoed by another TCCC board member,
Mete Boyaci, who has businesses in fast food, supermarkets,
cinemas, construction materials and construction. He was an
active "yes" campaigner in 2004 but now, he told us, the
political risk of being on the "wrong" side of a referendum
is too great. It is not that Boyaci is against a solution,
although he is extremely disillusioned by his inability to
find a consistent way to do business with Greek Cypriots (he
claims arbitrary and changing rules by GC customs, and GC
buyers who cancel orders at the last moment) and "Greek
Cypriot rudeness," just that in his analysis of personal
cost/benefits he would make out best whatever the results of
the talks if he just keeps quiet.


4. (C) The president of the Turkish Cypriot Bankers
Association, Yunus Ahramoglu, voted "no" in 2004 and remains
extremely mistrustful of his southern neighbors. Neither he
nor his association will have a position on a referendum, he
says. However, Ahramoglu was the only one of the three
businessmen who believes that a referendum would result in a
"yes" vote this time around because "Turkey will make sure."


5. (C) Comment: A solution in Cyprus would considerably
increase the wealth of these well-connected businesspeople
and perhaps a more certain prospect of this might change
their minds about how actively they would support a solution
at the right time. The personal embarrassment and hurt from
2004, especially their conviction that they were encouraged
by the U.S. and EU to be active in 2004 only to "get nothing
in return for our efforts and our people's yes vote" makes
them reluctant to say anything positive to us now.


6. (C) Comment continued. Since 2004, many TC businesses have
had some level of interaction with their GC colleagues to the
extent that north Cyprus exported goods to the GOC worth
about Euros 4.8 million in the first half of 2009. However,
TCs complain that this trade is difficult, subject to GC
whim, and that they are constantly made to feel "second
class" by the GCs. This sense of "condescension" towards them
by the GCs, and the GC "attitude that they are the only
aggrieved party in Cyprus' recent history" are points we
frequently hear from our TC business interlocutors. This was
not the case in 2004 when contact between the two sides was
much more limited. Familiarity has seemingly bred additional
mistrust.

URBANCIC