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DE RUEHNC #1088/01 1911450
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FM AMEMBASSY NICOSIA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6389
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 0585

C O N F I D E N T I A L SECTION 01 OF 03 NICOSIA 001088 
 
SIPDIS 
 
C O R R E C T E D COPY (TEXT PARA'S 1 AND 7) 
 
SIPDIS 
 
E.O. 12958: DECL: 07/10/2016 
TAGS: PGOV PREL EUN UNFICYP TU CY
SUBJECT: CYPRIOT LEADERS MEET, AGREE ON NEXT (BABY) STEPS 
 
REF: A. NICOSIA SIPRNET DAILY REPORTS (7/3/06 AND 7/7/06) 
 
     ¶B. NICOSIA 838 
     ¶C. SCHLICHER-SILLIMAN EMAIL (7/7/06) 
     ¶D. NICOSIA 294 
 
NICOSIA 00001088  001.2 OF 003 
 
 
Classified By: Ambassador Ronald L. Schlicher, reasons 1.4. (b) and (d) 
. 
 
¶1. (C) SUMMARY.  On July 8, Turkish Cypriot and Greek Cypriot 
leaders meeting with U/SYG Gambari reached agreement on a 
"Set of Principles" and immediate next steps to get the 
stalled Cyprus settlement process moving again.  Working with 
the UN, the two sides will engage in technical talks on 
day-to-day matters, as well as parallel "substantive" 
discussions on matters relating to a final settlement.  The 
communities will also discuss possible confidence building 
measures to improve the atmosphere between them.  Both 
leaders have spun the agreement as a victory in public, but 
Greek Cypriot and Turkish Cypriot officials are sounding a 
more cautious tone in private.  Disagreements over which 
items should be on the substantive agenda persist and it is 
unclear what will happen if the two leaders have not agreed 
on the substantive agenda by the end of July.  If the Gambari 
agreement is to produce results, both leaders will need to 
show unprecedented flexibility -- unlikely unless both Ankara 
and Athens actively press their Cypriot cousins for a 
successful process.  END SUMMARY. 
 
TALKS ABOUT TALKS 
----------------- 
 
¶2. (C) A July 8 meeting between President Papadopoulos, 
Turkish Cypriot leader Mehmet Ali Talat, and UN U/SYG Ibrahim 
Gambari produced a break-through of sorts, with the two 
leaders agreeing to a "Set of Principles" and some immediate 
next steps designed to kick-start the stalled Cyprus 
settlement process.  The meeting, which was the first 
settlement-related contact between the two leaders since 
before the failed 2004 Annan Plan referenda (ref a), was 
contentious and difficult, according to a UN source -- who 
privately reported that the Secretary General had to 
intervene by phone to resolve a last-minute, "deal-breaking" 
disagreement (she did not specify on what topic). 
Nonetheless, the two leaders (who had kicked their aides out 
of the room for the three-hour, closed-door session) appeared 
side-by-side afterwards, smiling and shaking hands as Gambari 
announced the agreement. 
 
¶3. (SBU) The agreement (the full text is being faxed to 
EUR/SE), outlines a five-part "Set of Principles" that 
include: 
 
-- 1) Reiteration of their commitment to a bizonal, 
bicommunal federation based on "political equality as set out 
on the relevant UNSCRs"; 
-- 2) Recognition that the status quo is unacceptable and not 
in the interests of either Greek or Turkish Cypriots; 
-- 3) Commitment to the proposition that a settlement is 
possible and desirable and should therefore not be delayed; 
-- 4) Agreement to move ahead with bicommunal talks on 
day-to-day issues that "affect the lives of the people" and, 
concurrently, with bicommunal talks on substantive issues, 
both of which will "contribute to a comprehensive 
settlement," and; 
-- 5) Commitment to put an end to the "blame game" and insure 
the "right atmosphere" for a successful process, and as part 
of this, recognition that additional confidence building 
measures (CBMs) are "essential." 
 
It also contains a "decision by the two leaders" to start the 
talks on day-to-day issues by the end of July 2006 provided 
that, at the same time, Papadopoulos and Talat also exchange 
a list of substantive issues, the contents of which will be 
studied by expert bicommunal working groups and finalized by 
the two leaders.  Finally, Papadopoulos and Talat agreed to 
meet again "from time to time as appropriate to give 
directions to the bicommunal working groups and review the 
work of the Technical Committees." 
 
¶4. (C) The agreement contains something for everyone.  The 
inclusion of a "substantive" track, parallel to the technical 
one, appears to be a victory for the Greek Cypriots, since 
Talat (fearing that he would be pressured into piece-meal 
concessions - ref b) had opposed broadening proposed 
technical talks to include settlement-related issues.  For 
their part, the Greek Cypriots agreed to a reference to 
"political equality" and accepted to discuss confidence 
building measures -- an idea Talat had pushed with Gambari 
earlier.  Perhaps most interesting, however, is the agreement 
of the two leaders to meet again as needed to help move the 
process along -- and the implication that they could now be 
on the hook to ensure progress was made.  UN sources told us 
 
NICOSIA 00001088  002.2 OF 003 
 
 
privately that prior to their joint meeting, Gambari had told 
both leaders that they had to stop stalling and come up with 
ways to get the process moving (ref c). 
 
LET THE SPINNING BEGIN 
---------------------- 
 
¶5. (C) Both sides have gone into spin mode to proclaim this 
agreement as both a positive development and a victory. 
Turkish Cypriot press gave the Papadopoulos-Talat agreement 
breathless coverage in the context of a remark in which Annan 
reportedly said he wanted to solve the Cyprus problem by the 
time he leaves office at the end of this year.  In private, 
however, Talat aides expressed doubt that the agreement will 
produce significant movement -- much less a serious 
breakthrough -- toward settlement.  In public remarks, Talat 
balanced optimism with caution, stating that he was pleased 
with the agreement, despite the inclusion of 
"substantive issues."  He went on to reiterate that that the 
Turkish Cypriots would approach the discussion of substantive 
issues "in the framework of the Annan Plan." 
 
¶6. (C) Although Papadopoulos publicly cautioned that more 
difficulties lie ahead, other GOC officials underlined that 
the content of the July 8 text was very close to the February 
"Paris Agreement" (ref d) between Papadopoulos and Annan, 
which they claim laid out a similar two-track approach to 
issues of substance and of day-to-day concern.  Meanwhile, in 
a July 10 briefing to the diplomatic corps, the MFA's Cyprus 
Question Division Chief Erato Marcoullis stressed that the 
apparent concessions to the Turkish Cypriots were not, in 
fact, concessions.  She pointed out that "correct 
interpretation" of "political equality based on UNSC 
resolutions" did not include numerical equality between the 
two communities (aficionados can refer to UNSCR 716 for more 
details).  Marcoullis also noted that Talat's proposed CBMs 
were "incomplete" and "indicative," constituting little more 
than a rehash of a more "comprehensive list" that 
Papadopoulos had presented in July 2004 -- and resubmitted to 
Talat on July 8 to include the GOC's ideas on 
Varosha/Famagusta/direct trade.  Still, Marcoullis agreed 
that there was at least some "overlap" between the two sides' 
proposed CBMs (such as the opening of more Green Line 
crossings), cautiously suggesting that the recent agreement 
to consider CBMs opened "avenues for progress." 
 
¶7. (C) Perhaps most importantly, Marcoullis stressed the 
stipulation that technical talks and substantive talks would 
be "concurrent," something other GOC officials have also 
underlined in their statements.  In a reversal of her 
government's aversion to "asphyxiating timelines," Marcoullis 
insisted that the agreement between the two leaders 
stipulated that the lists of substantive issues must not only 
to be exchanged for study by the end of July -- but that the 
bicommunal working groups (which do not yet exist) would need 
to complete their study of the lists, and the leaders would 
also need agree on them, by that time.  (COMMENT: SRSG 
Moller's deputy had a different understanding of this 
provision when she met with us, and suggested that although 
the exchange of lists would have to happen by July, 
discussion of their content might continue beyond that date. 
END COMMENT.)  Progress on day-to-day matters was linked to 
progress on substance, Marcoullis stressed, and one track 
would not move forward without the other. 
 
COMMENT: MILES TO GO BEFORE I SLEEP 
----------------------------------- 
 
¶8. (C) Even a simple face-to-face meeting and a modest 
agreement are more than many people expected Gambari could 
accomplish on his trip to the island.  The July 8 agreement 
focuses exclusively on the next baby steps needed to restart 
the settlement process, but nonetheless represents a 
departure from the previous two years of deadlock, which have 
been characterized by name-calling, refusal to meet, and 
petty disagreements over protocol and terminology.  Gambari's 
private message to both sides -- that the next SYG would not 
put Cyprus as high on his agenda as Annan had, and that the 
UN would not hesitate to point fingers if the process 
collapsed -- appears to have focused the minds of both 
Papadopoulos and Talat.  Neither want to be blamed for a UN 
flame-out, so an agreement like this, which commits them to 
meet again and take personal responsibility for progress on 
talks and agendas, is a good thing. 
 
¶9. (C) Nonetheless, the Gambari agreement faces serious 
difficulties in its implementation.  Even though they have 
agreed to discuss both substance and day-to-day issues,  the 
two sides appear no closer to agreement on what those issues 
should be -- or on how they should be discussed.  Talat's 
repeated insistence on using the "Annan framework" for 
substantive discussion will certainly clash with the Greek 
 
NICOSIA 00001088  003.2 OF 003 
 
 
Cypriot desire to take a "piece-meal" approach by first 
tackling issues like settlers and the economy.  Meanwhile, 
questions like Varosha (which is a CBM for the Greek 
Cypriots, and a substantive issue for the Turkish Cypriots) 
or demining (which involves equities of the famously 
inflexible Turkish army) are also no closer to resolution. 
If the Greek Cypriots insist on total agreement by July 31 on 
what should be on the substantive agenda, the process may 
stall or even fail.  This, according to Moller's deputy, may 
be a case where quiet pressure from Athens could help. 
Similarly, if Ankara does not give Talat room to maneuver in 
the coming weeks, he could be painted as the intransigent 
party.  If the Gambari agreement is to get the settlement 
process moving again, both sides need to hear encouraging 
messages from their mainland cousins, as well as positive 
pressure to move forward from the broader international 
community.  END COMMENT. 
SCHLICHER