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initially. The more immediate problem is the availability and applicability of data
for the purpose of extrapolating a trend line. Data limitations (explained over the
next few pages) mean that initial tests must be restricted to projections of pan-
Cypriot income in 1980; there are insufficient recorded observations to allow
projections beyond 1980 having much meaning.
An initial proximation of all island economic development is based on the only bicommunal
macro-economic data that exists: 1950 to 1963 national income accounts.
As the constitution broke down on 23 December 1963, data in that year is probably
stili représentative enough of an integrated economy for it to be of use. The early
independence years (after 1960) begin to set the tone for subséquent development.
Unfortunately earlier data (before 1960) is imbued with the effects of exogenous
shocks, encompassing the peaks of a military build up and the troughs of subsequent
withdrawal. Between 1950-57 British military expenditure on the island increased
by over 600% 4 , boosting demand for goods and services produced locally and
creating a multiplier which rippled out through the domestic construction industry.
This is the period of the construction of the large scale service personnel résidences
within bases around Dhekelia and Akrotiri, when the output of the domestic
construction industry increased by 85% 5 . Once this activity was completed, British
Military expenditure on the island declined. For this and other exogenous reasons 6 ,
overall Cypriot GNP feil by 10% between 1957 and I960 whilst on a per capita
basis the fall was even greater at 15 % 7 . The 1950 to 1960 period also encapsulâtes
the rise of communal tension (the EOKA period, 1955-59) which also saw the
beginnings of organised violent ethnie tension and politically inspired population
shifts; consequently the period 1950-63 cannot be viewed as the ideal model of a
unitary Cypriot economy. However, between 1950 and 1955 and 1959 to 1963, for
4 Hald, M.W. 1968. A Study of the Cvprus Economy. Nicosia: Printing Office of the Republic of
Cyprus, footnote 50, p.34.
5 Between 1950 and 1957 the output of the domestic construction industry increased by 84.6% in
constant factor costs of 1950. UN. Programme of Technical Assistance,,. 1961, Cyprus. Suggestions
for a Development Programme, (the Thorp Report). UN. New York. 1961. Table 1B, p.3.
s The decline in copper and citrus prices (major Cypriot exports at the time) and bad harvest.
7 In constant factor prices of 1950. Republic of Cyprus Statistical Abstract 1961. Dept. of Statistics
and Research, Ministry of Finance, Nicosia, p.180.
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