Annans Plan is DISASTER

Matthew 27:1 When the morning was come, all the chief priests and elders of the people took counsel against Jesus to put him to death:
2 And when they had bound him, they led him away, and delivered him to Pontius Pilate the governor.
3 Then Judas, which had betrayed him, when he saw that he was condemned, repented himself, and brought again the thirty pieces of silver to the chief priests and elders,
4 Saying, I have sinned in that I have betrayed the innocent blood. And they said, What is that to us? see thou to that.
5 And he cast down the pieces of silver in the temple, and departed, and went and hanged himself.
6 And the chief priests took the silver pieces, and said, It is not lawful for to put them into the treasury, because it is the price of blood.
[The Bible]

Matsakis, Perdikis, Koutsou: plan is a disaster

By Alex Mita

Cyprus Mail 16 November 2002

WITH the deadline for an answer to UN Secretary-general Kofi Annan's plan for a solution to the Cyprus problem getting nearer, dissident voices are
beginning to emerge, claiming the proposal is a recipe for disaster.

Speaking to the Cyprus Mail, DIKO deputy Marios Matsakis yesterday slammed the plan, branding it as destructive and unacceptably biased towards Turkish positions.

"It is a completely destructive plan, non-functional and unacceptably biased towards the Turkish positions," he said.

"It is unfair and uncompromising in every respect regarding human rights. This sort of plan should not be considered as a basis for negotiations."

Matsakis said now was not the time to be talking about finding a solution and that the government should centre its efforts around accession to the EU and the upcoming presidential elections.

"This is not the time to be discussing a solution to the Cyprus problem," he said.

"We are currently waiting for the decision in Copenhagen, we are preparing for accession to the EU and we are three months away from presidential elections.

"We should wait until after accession and the presidential elections and then discuss prospects for a solution to the Cyprus problem."

Matsakis said not one single provision in the plan fulfilled basic human rights principles.

"It does not provide for the return of all refugees to their homes and the implementation of the acquis communautaire," Matsakis said. "It is totally ridiculous that we have to scrap European Court rulings like that of Titina Loizidou for human rights violations.

"This plan is far worse than having two separate countries. We would be better off if we stayed in our part and they stayed in theirs," Matsakis

The Green Party yesterday accused the government of putting a positive gloss on the Annan plan.

In a written statement, the Greens described the government's position as "irresponsible, unwise and provocative," saying the government was trying to convince the Cypriot people the plan was positive.

The Greens accused the government of carrying out mass propaganda.

New Horizons president Nicos Koutsou warned he would resign if his party agreed to the plan.

"The substance of the plan is negative, therefore the answer should be a clear no," he said.

"Accepting the plan as a basis for negotiation is really accepting the plan."

Meanwhile Paphos Bishop Chrysostomos said prelates would meet on Monday at the offices of the Kyrenia Bishop to discuss the Church's position on the plan and urged the government not to rush into any decisions.

"The Church has a voice and we will state our view clearly," he said.

"We are entering a path of no return and the government should not rush into giving an answer to the plan before listening to the Cypriot people."

The Paphos Bishop said the government should study every detail of the plan, because from the moment it was accepted as a basis for negotiation, they would not achieve anything for the Greek Cypriot side.

Annan plan: a recipe for economic disaster?

By Andreas Theophanous

Cyprus Mail 16 November 2002

THE economic dimension of a solution to the Cyprus problem will without doubt be of vital importance for the viability of the state. Thus economic factors, in the broadest meaning of the term, should be seriously taken into account in the examination of any solution model.

The expected economic aid package from the EU is acknowledged but it is more important that there should be internal dynamics for reconstruction and further development. And likewise, the return of territory is significant, but the proposed Annan plan should be assessed comprehensively; in other words, we should not lose sight of the forest for the tree. Within this framework it should be noted that ignoring fundamental rules for the smooth functioning of the economy will have serious consequences, and at first sight it seems that the Annan plan does not take economic factors into serious consideration.

The constitutional framework of a state decisively affects the economic structure and consequently economic performance. Economic structure includes, among other things, the decision-making mechanisms and processes, the relations between the private and public sectors, the legal framework that regulates economic activity, the taxation system, public expenditure, the relations between employers and trade unions, the tripartite co- operation on labour matters (employers - trade unions - the state) and so on.

It is equally important to make sure that there are no distortions in the economy. Thus, among other things, government expenditure as a percentage of GDP is a significant indicator that inevitably and undoubtedly affects economic structure and performance. For 2002, the above-mentioned indicator in the government-controlled area of the Republic of Cyprus is approaching 40 per cent. In case the Annan plan and the three-state structures that he proposes are implemented, government spending will rise sharply.

If we fail, for any reason, to take into account basic rules for the smooth functioning of an economy, there will be unpleasant surprises. For example, if we allow the public expenditure/GDP indicator to approach, let alone exceed, 50 per cent it will be an ill-omened beginning for the new state with gloomy prospects.

Such a development would dynamite the Cyprus economy with unforeseen consequences. The ill feeling and discontent that will result from the implementation of an unacceptable political system burdened with serious economic problems will constitute a highly explosive mixture.

Justifiably, one wonders whether it is wise to ignore the tremendous costs of running three state structures as well as the consequent problems, including cases of deadlock that would most likely arise owing to inflexible decision-making mechanisms. We should also be concerned about the prospects of success in bringing about convergence in the standard of living of the two communities without the unimpeded functioning of market forces. With fundamental distortions in the functioning of the free market system (i.e. no implementation of the three basic freedoms) the whole attempt for convergence will parallel the story of Sisyphus' punishment.

Finally, it must also be noted that Cyprus's course of acceding to the Eurozone will also be affected adversely. If the country's economic performance is allowed to be derailed because of the problems stated above (and they are not the only ones) then the value of the Cyprus pound will fall and there will be great delay in joining the Eurozone.

A flexible economic structure will have a positive affect on the economy, whereas an inflexible, distorted structure, as outlined in the plan, will have a negative effect on the economy. Examples of inflexibility and distortion in economic systems have been the USSR and Czechoslovakia; both of these systems collapsed from within.

Andreas Theophanous is a Professor of Political Economy and Director General of the Research and Development Center - Intercollege.

Bosnia shows pitfalls of UN plan for Cyprus

By Andrew Gray

SARAJEVO, Nov 13 (Reuters) - U.N. officials have cited Switzerland as the model for their new Cyprus peace plan. But the blueprint also seems to borrow from a country much less associated with peace, prosperity and harmony -- Bosnia.

The experiences of the former Yugoslav republic since its 1992-95 war show that complex power-sharing structures only work if the people involved genuinely want to make them work.

If they do not, the result can be endless bickering, economic stagnation and layers of bureaucracy a poor country can ill afford. The West ends up running much of the show.

"Highly complicated constitutional best in rich states," said Mark Wheeler, Bosnia project director at the International Crisis Group think tank. "They look very bulky, because they're incredibly inefficient, in poor states."

The U.S.-backed Dayton agreement which ended the war divided Bosnia into two highly autonomous "entities" -- apparently much as the U.N. plan announced on Monday foresees a Cyprus of two "component states," one Greek Cypriot and one Turkish Cypriot.

Bosnia's entities, a Muslim-Croat federation and a Serb Republic, each have their own president, government, parliament, police force, army, customs service, television channels, mobile phone network and sources of revenue.

Central institutions have far less power, although international officials have worked to bolster them.

They are also inhibited by blocking mechanisms meant to safeguard the rights of different ethnic groups. Those mechanisms have often been used to scupper or slow down reforms which would have made Bosnia a more viable state.

Politicians were unable to agree even on such mundane issues as the design of a common passport or vehicle licence plate after months of talks. The international community's High Representative finally had to impose solutions.

As Cyprus is set to be invited into the European Union, it may be all the more important it can speak with one voice rather than the cacophony that sometimes comes from Bosnia.


At the top of the Bosnian state stands a presidency of three members -- one from each of the main ethnic groups. The chairmanship rotates every eight months, much as the Cyprus plan envisages a presidential council with a rotating presidency

Analysts say the presidency has functioned well when it has been in the hands of moderates. But when nationalists dominate -- as they do now following elections last month -- it can achieve little as the members pursue rival agendas.

The chairmanship of the council of ministers, the closest thing Bosnia has to a cabinet, also rotates. The current High Representative, Britain's Paddy Ashdown, finds that arrangement so inefficient he wants to abolish it.

The tangle of institutions and slow pace of change has led some commentators to call on the West to admit Bosnia will always be unviable, let its Serb and Croat areas join with Serbia and Croatia and leave only a rump Muslim-dominated state.

"Time to concede defeat in Bosnia-Herzegovina," declared a recent piece by respected U.S. columnist William Pfaff.

But defenders of the current set-up say that, while it is not ideal, it is a compromise all sides have been able to live with -- about the best that could have been hoped for after such a vicious and bitter war in which around 200,000 people died.

They are encouraging Bosnians to see Dayton as the starting point on the roadto normality, rather than a final destination.



Draft Letter of Protest


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