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a majority of Cypriots the economy worked as it had for centuries, as one rather than in the interests of two competing nationalisms 8 . The problem with choosing an earlier period when the island was at peace and the economy more integrated, is that the data does not exist. There were no national income accounts published before 1950. Another problem is the speed of development. Before 1950 and particularly before the Second World War 9 , the structure of the Cypriot economy was différent. Modern property rights had only been created with the land reforms of 1939 and 1944 10 . What the 1950-63 data does have in its favour is that it is a fairly long and relatively unbroken time sériés, encompassing the economic activities of both communities (but alas also that of the colonial power's), the peaks and troughs of economic activity, some the resuit of endogenous phenomena, many exogenous (British military expenditure, the rise and then collapse of citrus and copper prices in the 1950's, the bad harvest in 1957). Paradoxically, this is probably as good a selection of random shocks as any, unique though the period was. A small economy is bound to be continuously affected by major exogenous shocks even if the main exercise here is to discount for the ones originating from ethno-national conflict. Essentially, with a disordinately distorted economy, cross-checking is necessary. The 1950-63 national income data provides a reference point for slightly more sophisticated yardstick projections attempted later. The object of these alternative yardsticks is to avoid dependence on data derived exclusively from Cyprus in this period which, because of the unusual nature of the 8 Between 1955-59 there was a Greek boycott of British goods and a Turkish boycott of the dominant Greek Cypriot economy. 9 The Second World War had been good for the Cypriot Economy. The first time it had looked like having any strategic significance to the British meant large scale investment in fixed capital formation, admittedly for military purposes but employing Cypriot labour and providing significant additional Cypriot income. 10 The 1939 "Law to consolidate and amend the law relating to land tenure", simplified and modernised immovable property rights on the island. Govt, of Cyprus, 28 February 1939, The Cyprus Gazette, pp 149-194, legislation no, 161. Nicosia: Govt. Printing Office. In 1944 "A law to Provide the conversion of the categories of immovable Property hitherto known as Vakf Idjaretein and Arazi Mevkoufe Takhsisat into Mulk and Arazi Mirie respectively and for matters incidental thereto", transformed large areas of land formerly leased from Evkaf (a legacy of Ottoman rule) to freehold property in the name of the leaseholder, who became liable to a Land Registration Fee of 3 % of the value of the property. Govt, of Cyprus, 6 April 1944, The Cyprus Gazette, pp 80-86, legislation no. 231. Nicosia: Govt. Printing Office. 295
historical phenomena (large externally financed military spending, civil unrest, decolonisation), may distort subséquent trend projections. The initial reference point assumes that Cypriot growth continues along the existing 1951-63 trajectory (blank columns in Figure 6.2 below) 11 and that both communities grew at an equal pace after 1963 from their existing share of national income 12 . The trend implies that Greek-Cypriots have performed better than could have been expected, given the economy's previous rate of growth having matched the performance of the entire economy by 1980. Turkish-Cypriots, meanwhile, did not matched the performance based on this trend. Their share of Cypriot income declined from 14.5% in 1963 to 9% in 1980. Seemingly, even with the significant redistributive effects of the politicai upheavals of 1974 (see Figure 6.1) Turkish- Cypriots had not recovered from the breakdown of power sharing and economie integration in 1963. Figure 6.2 Projected Cypriot GNP compared with Greek & Turkish-Cypriot GNP after 1963 C£800 C£700 -- C£600 -- 1 C£500 -- a C£400 & C£300 -- C£200 Simple trend line generated using ordinai? least squares approach on a semi log scale, giving an annua! growth rate of 4.766%. Cypriot GNP I Projection Greek Cypriot (GC) GNP Turkish Cypriot (TC) GNP ' ~ ~~ Projected TC share cet. par. C£100 - C£0 I 1 i" i n i 'i 'i 'i 1 'i l 'i "i 1 1 'i m OCìtJ-VOOOOM^VOOO o ri tj- vo oo o r- 0\ . — r- TON H r- - H r- - H r- ON Ì oo — ON < i—I i-H »-H * — l r - 1 » - * ( Ì T T - I Source: OC data: "Statistica! Abstrats" (various), TC data: Bicak, H.A. 1993. n Semi-log value of growth in GNP over time from 1950-63 was 0.04766 with a standard error of 0.0029301. 12 Bicak 1993. op. di., p. 4. 296
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ACKNOWLEDGEMENTS I would like to th
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ABSTRACT This thesis examines the e
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Table Of Contents Page Change in ec
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List Of Figures 2.27 Revenue from t
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List Of Figures 5.25 Main destinati
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List Of Figures 7.8 The degree of o
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List Of Tables 6.7 All island, Gree
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This thesis will examine the econom
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Vassiliou's classic work 5 publishe
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As many questions raised by economi
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Figure 1.1 The structure of recent
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In terms of the topic of this thesi
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political landmark coincides with a
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were the mechanisms which encourage
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however, Chapter 5 concentrates on
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Defining the title The first priori
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such? Is northern Cyprus simply run
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unlike Greece in 1923, were already
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itself as having been literally und
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economic history, Christodoulou's s
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incurred as a resuit of eonfl ict.
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Christodoulou has concentrated his
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any credit for successful economic
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anking technology, administrative c
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(which usually has a regressive imp
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contribution did labour remittances
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having been inspired by Zetter's in
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econstruction also provided a means
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Conclusion In analysing the extent
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he drew distinct analogies with the
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in Cyprus. The main objective is a
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The war proved a watershed in many
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Uruguay, Japan, Trinidad and Tobago
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financial, property and business se
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By 1960 exports represented over 20
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Table 2.1 Domestic Exports FOB in 1
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the period (1960-73), the différen
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Figure 2.4 Principal exports as a p
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producing 12% of GDP. Tourism (rest
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considerably more than Turkey, whos
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income. Mining and quarrying (now m
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Figure 2.10 Principal exports as a
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Figure 2.12 The Destination of the
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Figure 2.14 Ambiguous indicators: T
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Figure 2.15 Sìze of manufacturing
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By 1980 the economy of the Republic
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The scale of the disruption in the
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Whether taking the optimists approa
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financing from financial markets pi
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grew rapidly. In the immediate afte
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One of the major problems facing th
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coming, only concerning policy make
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with particular bottlenecks affecti
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"We attributed this finding to the
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aiding the recovery from the coup a
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employment: rapidly rising real ear
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Until the intervention of public fi
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to pick the Republic of Cyprus as t
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of offshore companies registered in
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Figure 2.27 Revenue from the offsho
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Figure 2.29 The changing compositio
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The structure of the economy, the c
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CHAPTER 3. The foundations of Takis
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Famagusta enclaves would be over-ru
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The historical context of separate
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generally concentrated in the lower
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agreed Constitution. Seemingly Clar
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séparation of the communities bega
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UN. 37 Some additional supplies mus
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Seemingly, by 1970 the Nicosia encl
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was made on the basis of a fixed in
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derived from Turkish transfer payme
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Patrick has offered a more complica
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spare parts and maintenance materia
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Emphasising the growing divisions b
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Chamber, Rauf Denktash, said people
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Figure 3.2 Thepossible economic eff
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produced by them rises significantl
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Committee" was the area military co
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February 1975 the latter bodies set
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The first five-year pian, published
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CHAPTER 4. The construction of a Tu
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Whilst the Turkish-Cypriot leadersh
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of supply, and/or marketing, in key
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shipment of 2000 tons of foodstuffs
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Eti still operateci out of Nicosia,
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institutions in northern Cyprus amo
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with multipurpose co-operatives, a
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A few new co-operatives were formed
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loans. Savings Banks do have access
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espectively. The Famagusta branch w
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Cypriot) Government in the 1960s, t
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increasing costs 31 . This is perha
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packages imported raffinate, supply
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a monopoly respectively. Where ther
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Evkaf is an Islamic organisation fo
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Evkaf had a largely obscure economi
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Meanwhile a little noticed phenomen
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After the summer of 1974, the Turki
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monitored Ledra Place check-point,
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the early eighties, when Turkish ar
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Figure 4.3 Number of tourists from
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the situation that had existed prio
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stay arrivais or diminish with the
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competing with the longer establish
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flexibility of family business stru
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Ltd., Turkish-Cypriots eventually g
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dominateci by: textiles, footwear a
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force of national cohésion, change
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Figure 4.9 Main Citrus Exporters in
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Ismail Bozkurt (who secured 32.1% o
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Table 4.9 Citrus exports from north
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Ultimately the failure to act on pr
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CHAFTER 5: Re-establishing economic
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prospects of their respective de fa
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Figure 5.1 Change in Cypriot GDP as
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{0 perceive the de facto situation
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Turkey maintains that her objective
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parliament during the unstable peri
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case study, he argues that given en
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Specifically, it is analysis of nat
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imports (Figure 5.5). The extent to
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Page 247 and 248: If "a leading sector in the process
Page 249 and 250: Just to put minds at rest that manu
Page 251 and 252: encouraged private sector action, t
Page 253 and 254: Figure 5.13 Gross domestic fixed ca
Page 255 and 256: major economic force, one that was
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Page 259 and 260: dominates international transfer pa
Page 261 and 262: a "development resource" 54 , rathe
Page 263 and 264: able to spearhead a revival aided,
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Page 267 and 268: overwhelming dependence on a genera
Page 269 and 270: In the difficult times that followe
Page 271 and 272: independence from total Turkish fin
Page 273 and 274: Figure 5.20 Orange production as a
Page 275 and 276: e exchanged for new "TRNC" (or, as
Page 277 and 278: Unlike the vineyards where most of
Page 279 and 280: Although not important in the initi
Page 281 and 282: Having said this, constant improvem
Page 283 and 284: compensation arrangements in the no
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Page 287 and 288: Figure 5.24 Proportion of citrus ex
Page 289 and 290: to treat exports from the whole of
Page 291 and 292: seem more politically motivateci an
Page 293 and 294: Figure 6.1 Percentage change in GNP
Page 295: initially. The more immediate probl
Page 299 and 300: It has been argued that if politics
Page 301 and 302: share of National Income to somethi
Page 303 and 304: Figure 6.6 Communal income in 1980,
Page 305 and 306: Selecting peers as proxies for pan-
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Page 311 and 312: Figure 6.9 Micro Economies; average
Page 313 and 314: Figure 6.11 Micro Economies; averag
Page 315 and 316: Figure 6.13 The level of government
Page 317 and 318: Figure 6.14 "More Developed Medìte
Page 319 and 320: Figure 6.17 "More DevelopedMediterr
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Page 323 and 324: Figure 6.22 Structure of production
Page 325 and 326: Figure 6.26 Degree of openness in t
Page 327 and 328: economic growth 49 (variables 6-9:
Page 329 and 330: implication, developmental différe
Page 331 and 332: spectrum in 1980 at 38%. Perhaps le
Page 333 and 334: namely investment rates 54 (in phys
Page 335 and 336: instruments, the justification for
Page 337 and 338: Figure 6.28 Average annual growth i
Page 339 and 340: Figure 6.29 How Cyprusfared in 1980
Page 341 and 342: Figure 6.30 Total Cypriot income 19
Page 343 and 344: o.zö; may reveai someimng 01 ine e
Page 345 and 346: developments elsewhere. The relativ
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unified economy) of 1963, Cyprus is
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CHAPTER 7. Conclusion 348 Comparati
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Turkish-Cypriot economy stagnateci.
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So it is worth looking again at the
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stand out however, revealing enough
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Figure 7.3 Gross domestic investmen
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Figure 7.5 "TRNC netforeign trade a
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Figure 7.8 The degree of openness i
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control. There seems to be ampie ex
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The role of tourism in the economic
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seem to be able to grow in line wit
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Comparisons throughout this thesis
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The Cyprus Mail Hellenic Group. Nic
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I.M.F. International Financial Stat
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1982. Fourth Emergency Economic Act
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"Turkish Federated State of Kibris"
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leadership of the two communities o
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"administrations" and key economic
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Bicak, H.A. (June) 1990. "The Impac
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Hudson, J. and Dyniotou-Jensen M. 1
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Mcdonald, R. 1989. The Problem of C
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Solsten, E. (ed.) 1993. Cvprus: A c
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