Cyprus PIO: News Update in English, 00-11-09

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From: The Republic of Cyprus Press and Information Office Server at <http://www.pio.gov.cy/>

Thursday, 9 November 2000

CONTENTS

• [01] UN Secretary General meets with President Clerides
• [02] Cyprus has achieved substantive progress in various areas of the acquis communautaire

[01] UN Secretary General meets with President Clerides

In the afternoon, the UN Secretary-General Mr Kofi Annan had a meeting first with President Clerides and then with the Turkish Cypriot leader Rauf Denktash.

In a statement to the press after the meetings, the UN Secretary General said he has given the Greek and Turkish Cypriot sides some general observations on some issues of procedure and substance. He said he would not make his remarks public and has asked the two sides to do likewise. Mr Annan also said he has asked the two sides to reflect on what he had told them between now and the next meeting.

The Secretary General announced that he has invited the two leaders to come to Geneva to resume the talks in late January 2001. Moreover, he has asked Mr de Soto to travel to Ankara, Athens and Cyprus later this month.

Mr Annan expressed the hope that the parties will understand his words as an effort to take further steps in the direction of a comprehensive approach to a settlement. He pointed out that at the end of the day it is for the parties to agree on a comprehensive settlement.

"The UN is seeking to facilitate the parties' efforts to reach that goal and my observations are offered to them in this constructive spirit", he added.

Asked if he had identified any positive outcome, Mr Annan said that the parties are still at the negotiating table, still talking, and as long as they are talking, he believed the prospect for progress was there and we "should be hopeful".

The parties are engaged in the substance of the talks and this development is "good progress", he added.

Invited to say whether the two sides have responded positively to his observations, the Secretary General explained that in this kind of negotiations there is a process, whereby one puts forward ideas and suggestions, which the parties then reflect on.

He said that did not expect the two sides to react immediately but to reflect on what he had said to them by their next meeting in January.

Asked how he sees the talks moving on from this stage, Mr Annan said that the objective is to a reach a comprehensive peace process and this was the direction he wished the talks to go.

[02] Cyprus has achieved substantive progress in

The European Commission released yesterday its Regular Report on Cyprus' progress towards accession to the European Union for the year 2000.

In its conclusions of the 110-page report, the Commission points out that over the past year, Cyprus has achieved substantive progress in various areas of the acquis communautaire, and continues to fulfil the Copenhagen political criteria.

According to the Commission's report, "the predominant political problem is the continued division of the island, but over the last year important efforts have been made in the search for a political settlement in line with the Accession Partnership". From the fourth round of proximity talks held in September, "there were encouraging signs that the two sides were engaging in substantive discussion", the Commission says.

"Cyprus is a functioning market economy and should be able to cope with competitive pressure and market forces within the Union", it says, adding that the Cyprus economy "continues to grow strongly and is operating at full employment". Some progress is being made in the areas of liberalisation and structural reforms.

The Commission points out however that macroeconomic stability has weakened recently and the current level and stance of fiscal policy are not sustainable over the medium term. Supervision must be improved in the co- operative banking sector and price liberalisation must be completed.

It also notes that competitiveness is hampered by a number of structural rigidities and significant state involvement in the economy.

The Commission underlines the need "to develop a credible and coherent approach to fiscal consolidation". With a view to progressive capital liberalisation, monetary policy must be made more efficient and market- oriented by the use of indirect instruments rather than direct interventions.

It also says that Cyprus must also prepare its private sector to operate in the open environment that integration into the EU requires and calls for greater political consensus in order to develop a comprehensive structural reform agenda.

It underlines that over the last year, there has been progress in adopting legislation in key areas of the internal market. Although new legislation has been adopted in some areas of free movement of goods, further efforts are still needed in respect of standardisation and certification as well as of the framework for the New Approach Directives.

In financial services further progress has been achieved in the adoption of appropriate national legislation and enhancing administrative capacity. The steps taken towards liberalisation of capital movements are positive; however, further efforts are still needed for a timely and orderly removal of remaining restrictions on capital movements before accession.

The conclusions of the report can be found at our Special Issues section. The full text of the Cyprus progress report (8 November 2000) can be found at

From the Republic of Cyprus Press and Information Office (PIO) Server at http://www.pio.gov.cy/

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