Our View: Reflecting on Cyprus’ 20 years in the EU

The Cyprus Republic marks the 20^th anniversary of joining the EU today. Membership was arguably the best thing to have happened to the Republic, which got much more out of it than the EU, which has a member state of a million people trying to dictate the bloc’s relations with Turkey.

Membership has not been plain sailing, especially during the bailout of 2013, when many in Cyprus accused our partners in the euro group and the ECB of not showing solidarity when the country had run into big economic problems, admittedly of its own making.

Although the measures imposed were very tough, especially the bailing in of the Bank of Cyprus depositors and shareholders, nobody else offered to help Cyprus out at the time. Some blamed the adoption of the euro, which placed the country under the authority of the ECB, but nobody considers what would have happened if the Cyprus pound was still being used. Both systemic banks would have been wound down as would have the co-ops if were not part of the euro zone.

It should also be mentioned that the first proposal of a 10 per cent levy on all deposits over €100,000 would have been much more manageable but it was rejected by our wise politicians. The assistance programme helped put the economy on the path to recovery, although many of the Troika’s proposals, such as the streamlining of the public sector, were ignored. Gesy, the minimum guaranteed income and reform of local government were also Troika proposals, although the latter has been turned into a complete mess by the parties. The fiscal discipline and budget surplus have become fixed policy objectives and the banks are now in rude good health.

Politically, it took some 18 years and the sanctions against the Russian Federation because of its invasion of Ukraine, for Cyprus to become fully aligned with its partners. It had acted as one of Russia’s representatives in the Union, often defending Moscow’s positions, but this awful role and the divided loyalties ended in February 2022 and for the last two years Cyprus has been a model member-state.

Perhaps we needed close to 20 years to understand the many benefits of EU membership, which, among many things, offers political and financial stability as well as security that is vital for a small state, part of which is occupied by Turkey. This sense of security provided by membership is probably the main reason Greek Cypriot politicians have been unwilling to agree a Cyprus settlement. The Commission had not wanted Cyprus to join without a settlement, hence the holding of the referendum a week before accession, President Papadopoulos had deceived our future partners, in giving assurances he would back a solution.

What the Commission had feared – making the Cyprus problem an EU problem – has happened to an extent and this is affecting the Union’s relations with Turkey. Last month, the European Council, at the behest of the Cyprus president, linked Turkey-EU relations to progress in the Cyprus problem, in its conclusions. The reference may have just been a gesture, but we should refrain from using EU membership for scoring points against Turkey, especially now that we have become a loyal member of the Union.