Greek Cypriots will vote on Sunday (28 January) to elect their next president amid a mix of economic optimism but doubts over the future of the peace process in the EU’s last divided country.
Incumbent president Nikos Anastasiades, from the centre-right Democratic Rally (Disy) is favourite to win a second mandate.
“There is a high chance that he will be re-elected. But it’s not a guaranteed win,” said Amanda Paul, from the EPC think tank in Brussels.
Anastasiades was elected in 2013 at the height of a financial crisis, just a month before Cyprus agreed to a €10billion bailout from the EU and the International Monetary Fund (IMF).
Cyprus exited the bailout programme in 2016, and Anastasiades is running for re-election as growth is expected to reach 3.5 percent this year, with employment also on the rise.
According to one recent poll, 51 percent of Cypriots feel the economic situation was better than a year ago.
Anastasiades has said he would pursue his economic policies, while putting more emphasis on tourism, small and medium enterprises and research and development.
But social issues and the lasting consequences of the financial crisis have been put forward as key issues by his two main opponents.
Malas, who was previously Anastasiades’ opponent in the 2013 run-off, is the most likely candidate to face him in the run-off on 4 February.
Major mortgage problems
The other main challenger is Nicholas Papadopoulos, from the Democratic Party (Diko), who has promised to create a public agency to manage non-performing loans (NPLs) such as mortgages that people cannot repay.
According to the European Central Bank, over 33 percent of loans were still non-performing in June last year – compared to an average of 4.6 percent in the EU – including 52.7 percent of loans in the private sector.
However, with foreign investment returning to Cyprus and the banking system reformed after the crisis, “Anastasiades is in a relatively comfortable position,” Paul said.
The outgoing president is in more of a hotspot over his handling of the negotiations with Turkish Cypriot leader Mustafa Akinci last year.
The two leaders had been trying to solve the 40-year old island’s division and create a so-called “bizonal and bicommunal federation”.
Talks failed in July at a UN-brokered conference in Crans-Montana, Switzerland, over the issue of the security of the island if the two parts were reunited, and over how the power would be shared between the two communities.
Anastasiades has put the blame of the talks’ failure on Turkey, saying that Ankara refused to consider removing its troops from the island and giving up its ‘right of intervention’.
Turkey, as well as Greece and the UK – the former colonial power – are guarantors of the island’s security since its independence in 1960. Turkey used its right of intervention in 1974 after a Greek coup toppled Cypriot president Makarios.
The island has been divided since then, and Turkey maintains over 35,000 troops in the northern part – which it is the only country to recognise.
Next week, the UN Security Council is expected to renew for six months the mandate of its peace force, which has been on the island since 1964.
“For there to be a Cyprus solution, it is necessary to have the positive cooperation and contribution of Turkey,” Anastasiades said earlier this month.
But many, including in Cyprus, say that talks failed because of his inflexibility.
“Talks didn’t collapse because of Turkey’s intransigence. People who were present at the talks say that Turkey actually displayed a greater amount of flexibility than many people expected,” Paul noted.
She said that although Greek Cypriots were right to demand an end to the Turkish guarantee and occupation, they should have taken into account the Turkish Cypriots’ desire to keep Turkish troops for a certain period after a peace settlement.
But she pointed out that Anastasiades was under domestic pressure.
“Anastasiades wants a solution but it’s not just about him. Unfortunately politics in the south is very populistic,” she said.
In a TV presidential debate last week, Malas said that Anastasiades missed a “historic chance” last year, and that his first priority would be to resume negotiations with the Turkish Cypriots under the UN umbrella.
Papadopoulos said he would seek a new peace conference if he was elected, but he blamed Anastasiades and his predecessors for “unacceptable and dangerous compromises” towards the Turkish Cypriots.
Whoever wins the election, however, few people expects talks to resume soon.
The situation is “not any clearer now than it was six months ago over how this process is going to go ahead,” Paul observed.
On one hand, she said, “Greek Cypriots seem to think that they can go on as normal, that they can just pick up as they left off.”
On the other hand, “the Turkish Cypriots want a new process, with a clear timeframe and a proper roadmap.”
Much will depend on Turkey, which is unpredictable – given the increasingly nationalistic and authoritarian positions of president Recep Tayyip Erdogan.
In northern Cyprus, elections held early January were won by the National Unity Party (UBP), which follows on a harder line than the entity’s leader Akinci.
But three weeks after the vote, four parties are still trying to form a coalition, and the line of the future Turkish Cypriot authorities over the peace talks remains uncertain.
If talks were to resume, Greek Cypriot officials recognise however that they would have to be better prepared than last year, in order to propose concrete solutions to obtain Turkey’s withdrawal, while reassuring the Turkish Cypriots over their power in a future unified state.
According to the recent poll, 53 percent of Greek Cypriots would favour of a compromise settlement, while 33 percent would prefer the status quo, and 12 percent neither.
“The atmosphere is not right now” for a breakthrough, Paul said.
“Unless there is a change of approach, more broadly, by the Greek Cypriots, it doesn’t matter who comes to power. The same things would happen. Talks and talks and talks, and then nothing.”