South Cyprus government offered Turkish Cypriots a share of gas funds in return for Turkey’s recognition of Cyprus’ EEZ

A report in the Greek Cypriot press on Wednesday stated that Greek Cypriot president, Nicos Anastasiades’ had submitted a proposal to Turkish Cypriot leader Mustafa Akinci on the issue of hydrocarbons, during their informal meeting in early August, that will allow the creation of an escrow account that would safeguard the Turkish Cypriot community’s share from the natural gas proceeds.

According to a report by Cyprus Mail, this was made known by the undersecretary to the Greek Cypriot president, Vasilis Palmas in a radio broadcast on Wednesday.

He said the Greek Cypriot national council heard that Anastasiades’ proposal ensures that through the account, the Turkish Cypriot community will be able to immediately reap its share of the profits – 30 per cent based on its population proportion – once money begins flowing into the hydrocarbons fund, expected in 2022.

However, the proposal carries the condition that Turkey adopts the UN Convention on the Law of the Sea and agrees to delineate its exclusive economic zone (EEZ) with respect to that of Cyprus, a move that if accepted would terminate Turkish drilling off the Cyprus coast and de-escalate tension.

A recognition of the Cyprus EEZ would also automatically signal Turkey’s recognition of the Republic of Cyprus.

In addition to the escrow account, Anastasiades’ proposal includes the creation of mechanism allowing the Turkish Cypriot community to remain informed of decisions and developments regarding the management of natural gas.

The proposal, reports say, was a major retreat for the Greek Cypriot side, as the move was being reserved as a negotiating card in the event of a new round of talks, as the presidency views the management of natural gas a matter for sovereign states.

As such, the right for Turkish Cypriot participation in reaping the benefits of hydrocarbons comes with the prerequisite that Turkey agrees to outline the Cyprus EEZ.

The non-recognition of the Turkish Cypriot administration as a sovereign state by the Republic of Cyprus was the basis for the rejection of the proposal submitted by Akinci in July for the formation of a joint committee for the management of natural gas.

The news comes as a backdrop to the ongoing efforts for the establishment of a set of terms of reference that will allow the resumption of peace talks.