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Cyprus PIO: Turkish Cypriot Press and Other Media, 00-10-30

Cyprus Press and Information Office: Turkish Cypriot Press Review Directory - Previous Article - Next Article

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


TURKISH CYPRIOT PRESS AND OTHER MEDIA

No. 208/00 -- 28-29-30

.10.00

[A] NEWS ITEMS

  • [01] Turkish Cypriots conduct assessment with Turkish delegation on even of talks Illegal Bayrak Radio 1 (10:30 hours, 28.10.00) reports that the delegations of Turkey and the pseudostate last Saturday held an assessment meeting on the eve of the fifth round Cyprus proximity talks. Attending the meeting, under the chairmanship of Rauf Denktash, were Tahsin Ertugruloglu, ``foreign affairs and defense minister''; Turkish envoy Ertugrul Apakan; Faruk Logoglu, Turkish Foreign Ministry under secretary, as well as other bureaucrats. In a statement before the meeting, Denktash pointed out that the two sides have not yet reached a common point. Denktash stated that the Turkish Cypriot side is acting in full unity of views with Turkey both in internal matters and in the ``national cause''. Denktash claimed that President Glafcos Clerides, who said in a statement to CNN a few days ago that the Greek Cypriots accept the Turkish Cypriots equality, immediately afterward revealed the kind of equality he had in mind by saying that the Turkish Cypriot side cannot block Cyprus/ accession to the EU. Alleging that the Turkish Cypriot side has the right to political equality and sovereignty as well as to close to 33 percent of the territories, Denktash said that the Greek Cypriots believe that the whole of Cyprus belongs to them. Denktash claimed that as far as the Greek Cypriots are concerned, the Titina Loizidou case eliminated the global struggle with regard to the property exchange issue. In this context, Denktash said, the Greek Cypriots are claiming that they have the right to get their property back. Denktash noted: ``This has enlightened our refugees, and it will continue to do so. This has revealed the real intention behind the chants of peace''. Denktash added: ``No agreement has emerged on anything yet. The Secretary General explained what this agreement can be: Two separate units with equal status will eventually emerge. The Secretary General outlined a very clear framework: One unit will not represent the other, and neither will be able to speak on behalf of the other. The Greek Cypriots rejected this framework''. Logoglu, in his statement, declared that his main aim in arriving in Cyprus was to conduct a last assessment of the situation on the eve of the proximity talks and learn the views in this regard. Logoglu stated that the entire Turkish people stand by the Turkish Cypriots, adding that Turkey is aware of the great efforts exerted by the Turkish Cypriots to attain the expected goal in the talks. Wishing Denktash success in the upcoming talks, Logoglu said that he expects the Greek Cypriot side to exhibit sincerity during the talks. Referring to the EU issue, Logoglu said that Turkey believes that Cyprus cannot join the EU before a solution. ``EU membership can be an option after a solution and with the consent and separate approval of the two peoples in Cyprus,'' Logoglu said. Even then, he added, Turkey/s interests vis-a-vis the EU must be guaranteed. Logoglu said that the current state of affairs is far from satisfying that.
  • [02] Denktash meets de Soto Anatolia Agency (12:26 hours, 27.10.00) reports that Turkish Cypriot leader Rauf Denktash said on Friday that Alvaro de Soto, the Special Representative of United Nations Secretary General Kofi Annan to Cyprus, had realized the difficulties in Cyprus. Addressing journalists following his meeting with De Soto, Denktash said, we held the last meeting with De Soto prior to the fifth round of proximity talks which are due to start in Geneva, Switzerland, on November 1. He explained his impressions about his one-week contacts on the island''. When asked whether or not De Soto believed that ``difficulties stemming from the Greek Cypriot side'' would be solved in Geneva, Denktash said, ``Do Soto may believe that. What is important is whether we believe that these difficulties will be solved. We have not seen a positive approach from the Greek Cypriot side so far''.
  • [03] Denktash does not see ``slightest chance of agreement'' with Greek Cypriots Anatolia Agency (18:32 hours, 28.10.00) reports that Turkish Cypriot leader Rauf Denktash has said that the Turkish Cypriots are going to the fifth round Cyprus proximity talks slated to begin in Geneva on 1 November on the basis of a ``confederation'', while the Greek Cypriot House of Representatives decided that a ``federation is the last concession''. Pointing out that by adopting such a decision the Greek Cypriots aim at forcing the Turkish Cypriot side to discuss the option of federation, Denktash said that the Turkish Cypriots proposed a confederation after having reached the conclusion at the end of years of negotiations that the Greek Cypriots do not want a federation. Denktash noted that a solution can also be discussed without giving it a name. In a lecture he delivered at the Brothers Hearth organization Saturday night, Denktash said that the dialogue will be conducted under equal conditions, adding that before trusting the Turkish Cypriots, the Greek Cypriots must first inspire confidence in the Turkish Cypriots. Denktash explained that he is going to the Geneva talks more prepared than before, and said that he will remain in Geneva until 10 November, from there he will proceed to Abu Dhabi for the Islamic Conference, and he will return to Cyprus on 14 November. Announcing that the next round of talks are scheduled for January, Denktash said that he proposed to Alvaro de Soto, UN Secretary General/s special envoy for Cyprus, to hold the future talks in Cyprus. Denktash stated: ``It is no longer right to cross the ocean so often and incur to much expenses. There are no clashes in Cyprus. Therefore, we can easily hold these talks in Cyprus. I asked him to transfer the talks to Cyprus. There is no reason for us to travel abroad so frequently. We will insist on this. If they are reasonable, they will accept''. Recalling that for years he has been attending talks, Denktash claimed that he never observed the willingness to reconcile in the Greek Cypriots. He alleged: ``If I had detected in the Greek Cypriots the slightest chance of reaching a conciliation with us, of reaching an agreement without undermining our security, our equality, and our rights over Cyprus, I would have concluded an agreement with them long ago''. Denktash also said that any agreement that fails to guarantee the Turkish Cypriots/ security would lead to a confrontation in Cyprus similar to that between Israel and the Palestinians. Noting that the issue of property is important in the solution of the Cyprus problem, Denktash said that this matter can be resolved through exchange and compensation, he managed to convince the United Nations of this, but the Greek Cypriot leaders do not accept it. Denktash declared that the Turkish Cypriots want an agreement that recognizes the equality and sovereignty of the Turkish Cypriots, that accepts the existence of the Turkish state, that preserves Turkey/s rights over Cyprus, and that does not eliminated the Turkish-Greek balance.
  • [04] Debate on pseudostate/s economy Illegal BRTK (18:30 hours, 20.10.00) carries a 180-min live discussion on the Turkish Cypriot economic stability program in the studio on the ``3rd Dimension'' program with Bulent Kanol, ``undersecretary'' at the ``Prime Ministry'', Mehmet Burhan Huralp, ``undersecretary'' at the ``Economy and Finance Ministry'', Mehmet Turgud ``undersecretary'' at the ``Economy and Finance Ministry'', and Isilay Yilmaz, ``undersecretary'' at the ``National Education and Culture Ministry'', all involved in the preparation of the economic package. Opening the debate, moderator Ozer Kanli asks the panellists why the need was felt to draft the new economic stability program. Speaking first, Bulent Kanol says that despite chronic balance of payments deficit over the last 10-15 years there was no serious fiscal crisis until 1999 to warrant the introduction of an austerity program. To make his point, he notes that over these years the exports stood at a steady $50 million and imports at $400 million annually, with the $350 million in foreign trade deficit being partly covered by tourism revenues of approximately $190-200 million. Another approximately $100 million revenue was collected from students studying in the north. That left an overall budget deficit of $50 million per year. Bulent Kanol explains that the banking crisis arouse at the close of 1999 and early 2000, when the public finances were already strained due to the TL (Turkish Lira) 3.5 trillion monthly deficit, which up until the introduction of economic reforms in Turkey used to be covered by Turkey. Those reforms in Turkey had a lightning effect on the economy in the pseudostate, as a result of which the already unsound banking sector buckled under pressure, leading to the collapse of six banks. That in turn generated a sever fiscal crisis on top of the chronic economic crisis which in itself had not been causing much of a problem to the community. Bulent Kanol says after Turkish State Minister for Treasury Recep Onal visited the pseudostate to sound out the views of different sectors, the Turkish officials drafted their own measures, discussed them with the Turkish Cypriot bureaucrats, and eventually came up with an economic package and told the Turkish Cypriots: ``You have to adopt these measures if you want to really implement a new program and want us to finance it, otherwise our credits to you will be wasted''. Kano says that the package was again debated in the pseudostate, 14-point objections were conveyed to Turkey, and after renewed debates it was given the present shape. Bulet Kano discloses that behind this package lay the Turkish officials/ belief that the ``TRNC'' economy has failed to grow primarily because of structural problems, inflation, and external obstacles; that the public finances are overstretched; that the public deficit has become chronic and moreover it is steadily growing; that the overwhelming presence of the public sector in the economy and its absorption of the funds has been hindering the development of the private sector; and that a strategic partnership should be established with Turkey and the formal integration with the EU should be initiated in order to eliminate the heavy burden on the economy resulting from the embargo''. Kanol says the Turkish officials also identified specific problems, namely, ``Heavy financial burden caused by social security system, bloated public service, ineffectual public spending, wasteful agricultural subventions, defective banking sector regulations, and lack of control and monitoring of finances''. Bulent Kanol says they, as the Turkish Cypriot technical delegation conducting the talks with Turkish officials, shared the above diagnosis on the whole, but some differences arose when discussing the remedies and these discussions lead to the modification of some of the articles in the package. Speaking next, Mehmet Burahn Huralp points out that the main problem that the package wants to solve is the ``public deficit''. As an example, he says that in the month of September 2000 the revenue levied locally was TL 14.5 trillion. It came from taxes, tariffs, and service duties. As additional TL 3.5 trillion was drawn from the ``Price Stability Fund''. As such, the overall monthly revenues amount to around TL 18 trillion. In comparison, TL 10.5 trillion was spend on personnel, such as wages, salaries and overtimes; TL 11 trillion was spent for social security-the bulk of which went to pension salaries and contribution to the social security institutions, assistance to the needy and martyrs/ families; TL 1 trillion was earmarked for ``government/s'' current expenditures, such as payments for repairs, fuels, telephones, medical supply to hospitals; and TL 500 billion was used from the local resources for investments. The overall expenses thus amount to around TL 23 trillion. That left the pseudostate with a TL 5 trillion monthly deficit. Considering that under a ``protocol'' signed with Turkey in 1997 Turkey provides $3 million every month-that approximately makes TL 2 trillion-as a contribution to the pension salaries, the grand total monthly deficit in the pseudostate stood at TL 3 trillion in September. And this figure only shows the deficit on outlays included in the ``budget''. Yet there are many other public expenses not shown in the ``budget'', such as the drought compensation to the farmers, export incentive funds, and credits opened in the private sector and other ``state'' agencies, he says. Mehmet Burhan adds that the second structural defect results from the so- called ``advance payment'' system introduced since 1990. This means that on the first day of each month the ``government'' has to find at least TL 18- 19 trillion to pay the salaries and meet other expenses before the revenues for them are actually levied. He says the ``government'' then tries to cover the end-of-month TL 3 trillion deficit by borrowing from the ``Central Bank'', with the result that the ``Treasury'' has accrued $180 million debt with the ``Central Bank'' since 1994. This is only the debt owed to the ``Central Bank'' by the ``state''. Burhan mentions 1990,1994, 1997, and 2000 as the years when deficit spending crept into the economy. He says that the pre-1990 balanced budget was undermined in 1990 with the Gulf War and the collapse of (businessman Asil Nadir/s firm) Poly Peck, and most importantly in 1994 with the financial crisis in Turkey which manifested itself in the pseudosate in the form of 215 percent inflation. It was from 1994 onwards that the pseudostate began having a ``budget deficit'' and accumulated debt to cover it. And with reduction of Turkish assistance due to the economic crisis there, as of 1994-1995 the pseudostate began to borrow from the ``Central Bank'' to pay off the salaries. That is how the public finances were upset. The $250 million credit opened by Turkey in 1997 also could not revive the economy because the money did not make into the market, instead was sucked up by a fiscally disorderly and glowingly bloated ``government''. The ``government'' planned but never took decisions to scale down public spending and bring it under discipline. Mehmet Burhan wonders if it is possible to maintain an economy where the Turkish aid is only used for covering ``budget deficit'', where no investments are made or public services rendered, no funds could be allocated to the economy, and where all the funds of the ``Central Bank'' has been depleted. Burhan concludes by saying that the ``state'' must start economizing and convince the people that it has stopped the profligate use of funds if this program is to succeed. Third speaker Mehmed Turgud starts off by saying that public reaction to change is normal, implying at the same time that he disapproves of the opposition for calling the austerity program as ``package of destruction'' He declares that the banks should be encouraged to reopen the credit taps. Indicating that the program calls for the servicing of the $400 million public debt within the next three years, Turgud says this money would accumulate in the banks, which would want to give it out as credits. And considering that the banks will no more take this money to Turkey to make profits in high-interest repo transactions, they will be forced to give out these money in the form of credits, even by lowering lending rates. As a further measures to ensure liquidity, Turgud points out that the package also prohibits the ``state'' from taking bank loans or even borrow from the ``Central Bank'' until it brings its outstanding debt there down to a certain level. That would create an abundance of liquidity as of next year. That, in turn, would ease the credit markets and bring the interest rates down. Turgud also notes that another reason for the depletion of the ``Treasury'' was the right to pension after a 10-year service. He says no one back in the 1970/s, when this right was introduced, ever calculated the cost of sustaining for 50 years a person that becomes a pensioner at the age of 28. This is another reason why reforming the public finances has gained such an urgency. Speaking last, Isilay Yilmaz says the current package was the outcome of a long-standing search to reform the public administration and finances. She too argues that over the years there has actually been no substantial change in main economic indicators, adding that currently local budget revenues comprise almost 28 percent of the ``GDP'', and the current expenditures-personnel payments, other public expenditures, minus the transfers to social security institutions and pension fund-stand now at 18 percent of the ``GDP''. What have really risen over the years and strained the public finances are the transfers-most of which is eaten by pension salaries and payments to the social security institutions. These transfers rose from 7.5 percent in 1977 to 20 percent in 2000. She thus notes that the personnel expenditure and number of public servants have remained almost the same over the years, what has really increased is the number of pensioners. In other words, the number of employees has basically remained between 10,000-11,000, but the number of pensioners has risen sharply to 10,500. Noting that the ``government'' disburses an aggregate of 25,000-30,000 paycheques and that previously 20,000 of these paycheques were taxed but now only 11,000 of them are taxed, she says this is what is causing the bottleneck in the public sector. Seeing that it can no more pay 30,000 paycheques and at the same time withholding taxes levied from only 10,000 public employees, the ``government'' is forced to increase direct and indirect taxes in the market. But because even the taxes levied thus have failed to keep pace with personnel expenditure a budget deficit has steadily grown. The pseudostate has thus been forced to borrow money from private banks, the ``Central Bank'', other funds, causing a money crunch in the private sector. Because the ``government'' pays high interest on these loans by simply emitting money it contributes to the rise in inflation imported from Turkey. The solution, she adds, is to release these money resources to the private sector. Another way is to reform the social security system and base it on actuarial system. She explains that the ``government'' at present cannot make any proper actuarial calculations or financial planning because a ``public servant'' can retire just anytime he/she fancies once the minimum ten years service requirement is completed. The ``government'' therefore, is in no position to know beforehand how much funds it needs for pension payments for a given year.
  • [05] 41 organizations file complaint against ``government'' for betraying people According to illegal Bayrak Radio 1 (10:30 hours, 27.10.00), a total of 41 organizations supported by the Republican Turkish Party (CTP) and the Patriotic Unity Movement (YBH) went to the ``Office of the Chief Prosecutor'' and filed a complaint against Rauf Denktash and the ``government members'' on grounds that they betrayed the people with the socioeconomic package that is being implemented. ``Chief Prosecutor'' Akin Sait, in a statement he made prior to the complaint filed by the organizations, said that in the light of the work they have conducted, these organizations have certain expectations from the ``Office of the Chief Prosecutor''. He added that ``his office, as a judicial department, will not hesitate to exercise the authorities granted to it by the Constitution and the laws after having listened to the expectations of the organizations in question''. Ahmet Barcin, leader of the Turkish Cypriot Secondary School Teachers Union, in a statement he made on behalf of all the organizations, described as an economic destruction package the economic stability program being implemented by Denktash and the National Unity Party (UBP)-Communal Liberation Party, (TKP) ``government''. He charged that the package in question will abolish their gained rights. Charging that the implementation of the package will be tantamount to betraying the people, Barcin noted that this behaviour in contravention of the ``Constitution'' and the ``laws'' is tantamount to rescinding the right of the Turkish Cypriots to self-administration. Pointing out that the package in question is aimed at destroying the Turkish Cypriot community, Barcin added that the package, at the same time, aims at violating constitutional and democratic rights. After receiving the text, Sait said that the socioeconomic package cannot be implemented without a legal arrangement, adding that the 41 organizations should not be distressed. Noting that his duty is to implement the ``Constitution'' and the ``laws'', Sait said that the package, which the ``government'' has put into effect, cannot be implemented on its own. Noting that it will soon be clarified whether gained rights can be revoked through legal arrangements, Sait added that, however, at that stage the views of his ``office'' will be requested on the ``bills'' in question. He continued: ``We have not approved any issue that violates the Constitution. Even if a bill is approved by the Assembly, if we find that it violates the Constitution, then the issue is referred to the Constitutional Court. The final word rests with the Constituitonal Court''.
  • [06] One more DP ``deputy'' resigns from party According to illegal Bayrak Radio 1 (10:30 hours, 27.10.00) Democratic Party (DP) ``deputy'' Kenan Akin has resigned from his party. In a statement Akin said that he will continue his work as an independent ``deputy''. With Akin/s resignation the number of DP ``seats'' in the ``assembly'' has been reduced to
  • [11] The current distribution of ``seats'' is as follows: National Unity Party has 23 ``seats'', the Communal Liberation Party seven, the Republican People/s Party six, and independents three.
  • [07] Eroglu says Clinton is trying to solve already resolved problem According to illegal Bayrak Radio 1 (6:00 hours, 30.10.00), so-called prime minister Dervis Eroglu has said that the road to peace passes through the acknowledgement of the existing ``realities'' in Cyprus. He was addressing the Ataturkist Thought Association the other night. Stressing that the Turkish Cypriots are determined to make the pseudostate live forever, Eroglu said that there were many difficulties in the establishment of the ``TRNC'', that freedom has a price, and that the Turkish Cypriots paid this price. On the Cyprus question, Eroglu recalled President Clinton/s remarks that Cyprus is an issue he has not been able to solve. Eroglu said: ``The fact that the United States is so interested in solving the Cyprus problem while there are so many problems awaiting solutions in the world is not merely because it wants to solve a problem. Actually, it is trying to solve a problem that has already been solved. That is why it cannot get any results''. Eroglu claimed the Cyprus problem has been solved, adding: ``What is being sought in Cyprus is peace and an agreement that will enable the two neighbouring peoples to live peacefully''. He emphasized that nothing will be gained by ``coveting'' so-called TRNC territory or by trying to eliminate the ``TRNC''. He said: ``What we are dwelling on today is the need to further deepen the relations between the TRNC and its motherland, to explain the reality of the TRNC to the world in cooperation with the motherland, and to continue to work in order to have our just cause confirmed at the negotiating table.''

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


    Cyprus Press and Information Office: Turkish Cypriot Press Review Directory - Previous Article - Next Article
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