The Republic of Cyprus is a small country with a population of 1.2 million people that occupies only 60% of the territory of the island. Another 2% of the territory belong to the United Kingdom which has two military bases on the island: Akrotiri and Dhekelia. The remaining part is under control by the Turkish Republic of Northern Cyprus which is officially recognized only by Turkey and the Republic of Abkhazia. However, despite its small size, the lack of unity between the Cypriot and Turkish territories, as well as the relatively low level of economic development, the political and strategic potential of the island should not be underestimated. Its geographical position makes it an important area of intersection of the interests of major players such as NATO, the EU, China and the Russian Federation.
Given that the island of Cyprus is located in the eastern Mediterranean, near the Suez Canal in close proximity to the Middle East, the UK is striving to keep its military bases there. London has to constantly assuage the Republic of Cyprus’s desire to reclaim these territories for itself. In 2008, the United Kingdom was concerned about Demetris Christofias’ rise to power; he promised to expel all foreign troops from the island, but in 2013 Nicos Anastasiades became President of Cyprus – back then he was a supporter of Cyprus’ entry into NATO. However, until now, neither scenario has played out.
Seeking a way out of financial difficulties that rocked Cyprus in 2012 and continued in 2014, the Cypriot authorities have embarked on a rapprochement with Russia and deepening long-standing ties with China, which would inevitably lead to a cooling of relations with the West. Cyprus accuses the United States and the EU of ignoring their interests, as it does not receive their support in its ongoing confrontation with Turkey. According to the Foreign Minister, Ioannis Kasoulidis, China and Russia have a greater appreciation of this issue.
Thus far, a rather interesting situation has come about: while British military bases were in operation on the island, the President of Cyprus, Nicos Anastasiades, held talks in Moscow in early 2015 on allowing the Russian Navy to use the Cypriot port of Limassol. This proved very timely for the Russian Federation, as the only Russian point of logistics in the Mediterranean was located in the Syrian port of Tartus and had been lost due to the war in Syria. The first discussions on the possibility of establishing a Russian military base in Cyprus began a few years ago, but back then it was hardly expected that the plan would be implemented. And now the case can be considered closed and Russian ships and materials will be located in the port of Limassol for operation, despite the extremely negative reaction of the EU and the United States.
It is likely that another reason for Nicosia’s decision was that, being an EU member, the Republic of Cyprus was forced to adhere to the anti-Russian economic sanctions, thereby compounding the already dire financial situation of the country. Expressing solidarity with the EU and the US, Cyprus was “between the devil and the deep blue sea.” According to the Cypriot Minister of Foreign Affairs, I. Kasoulidis, “Europe’s economic sanctions against Russia could destroy the economy of Cyprus”, as both countries are closely linked in trade, financial relations and mutual investment. From one-third to half of the deposits in Cypriot banks are of Russian origin. Thus, it can be assumed that Cyprus’ granting its port to the service of the Russian military fleet goes some way to compensate for the losses that Cyprus and Russia suffered due to the sanctions. Undoubtedly, the commencement of the Russian Navy’s operation on the base was followed by new Russian investments in the Cypriot economy.
Particular attention should be paid to the relationship between Cyprus and China. In middle of October 2015, Beijing opened a special conference of Asian political parties on the subject of implementing the Silk Road Economic Belt project. The President of the Cyprus, N. Anastasiades appeared among other distinguished guests at the conference. He expressed Cyprus’ desire to actively contribute to the Chinese New Silk Road project and make every effort to strengthen cooperation between the countries of Asia, Europe and Oceania.
Even on the eve of his visit to China, N. Anastasiades said that the Chinese “one belt one road” initiative would benefit all countries that participate in the project. It would be mutually beneficial to create a combined Asian and European economic zone, and the Republic of Cyprus would take active part in the project. In Cyprus, the trade routes from Europe, Asia and Africa intersect. Therefore, as the president said, Cyprus was particularly interested in the implementation of the Chinese 21st Century Maritime Silk Road project . Moreover, Cyprus, being as a member of the EU, intends to promote the development of relations between the EU and China.
Speaking at the conference, N Anastasiades said that the cooperation between the Republic of Cyprus and China had a long history. Since the establishment of diplomatic relations, which began as early as 1971, they were always friendly, and the views of the leaders of the two friend countries on various international issues were always the same. As a member state of the EU with its rich history and culture, as well as having wide experience in providing financial services, and taking into account its favourable geographical position, “Cyprus can greatly benefit the project connecting Europe and Asia,” the President said.
It is important to note that N. Anastasiades was the only EU politician who participated in Beijing’s Conference. Alongside his appearances at the event, the Cypriot President plans also included an official meeting with Chinese President Xí Jìnpíng held on 15 October.
During the meeting, the leaders of Cyprus and China discussed the economy and future investments. According to N. Anastasiades, following the economic crisis in 2012-2013, Cyprus is actively pursuing the reforms that lead to increased opportunities for investments by foreign companies, including the Chinese. It is well known that the Cyprus economy is heavily dependent on external factors. For example, about 20% of GDP falls upon tourism. This undoubtedly does not suit the leadership of Cyprus, and it is interested in finding other methods of replenishing the state budget and, most importantly, of reinforcing its international importance and enhancing its standing.
Will the Republic of Cyprus become a key player in the economic cooperation with China and military cooperation with Russia? Will it act as the “bridge” between Europe and Asia, a role it aspires to? It is not worth guessing, but the current situation is rather conducive to this.
Dmitry Bokarev, political observer, exclusively for the online magazine “New Eastern Outlook“.
