Cyprus

A former British colony, Cyprus became independent in 1960 following years of resistance to British rule. Tensions between the Greek Cypriot majority and Turkish Cypriot minority came to a head in December 1963, when violence broke out in the capital of Nicosia. Despite the deployment of UN peacekeepers in 1964, sporadic intercommunal violence continued forcing most Turkish Cypriots into enclaves throughout the island.

In 1974, a Greek Government-sponsored attempt to overthrow the elected president of Cyprus was met by military intervention from Turkey, which soon controlled more than a third of the island. In 1983, the Turkish Cypriot-occupied area declared itself the "Turkish Republic of Northern Cyprus" ("TRNC"), but it is recognized only by Turkey. In February 2014, after a hiatus of nearly two years, the leaders of the two communities resumed formal discussions under UN auspices aimed at reuniting the divided island.

The talks are ongoing. The entire island entered the EU on 1 May 2004, although the EU acquis - the body of common rights and obligations - applies only to the areas under the internationally recognized government, and is suspended in the areas administered by Turkish Cypriots. However, individual Turkish Cypriots able to document their eligibility for Republic of Cyprus citizenship legally enjoy the same rights accorded to other citizens of European Union states.

party to:

Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-Persistent Organic Pollutants, Air Pollution-Sulfur 94, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Environmental Modification, Hazardous Wastes, Law of the Sea, Marine Dumping, Ozone Layer Protection, Ship Pollution, Wetlands

signed, but not ratified:

none of the selected agreements

chief of state:

• President Nicos ANASTASIADES (since 28 February 2013);
• note - the president is both chief of state and head of government;
• post of vice president is currently vacant;
• under the 1960 constitution, the post is reserved for a Turkish Cypriot

head of government:

President Nicos ANASTASIADES (since 28 February 2013)

cabinet:

• Council of Ministers appointed by the president;
• note - under the 1960 constitution, three of the ministerial posts are reserved for Turkish Cypriots appointed by the Vice President but the positions are currently filled by Greek Cypriots

; (For more information visit theWorld Leaders website)

elections:

president elected by popular vote for a five-year term; election last held on 17 and 24 February 2013 (next to be held in February 2018)

election results:

• Nicos ANASTASIADES elected president;
• percent of vote (first round) - Nicos ANASTASIADES 45.46%, Stavros MALAS 26.91%, Giorgos LILLIKAS 24.93%, other 2.7%;
• (second round) Nicos ANASTASIADES 57.48%, Savros MALAS 42.52%

note: Dervis EROGLU became "president" of the "TRNC" on 23 April 2010 after "presidential" elections on 18 April 2010; results - Dervis EROGLU 50.4%,

Mehmet Ali TALAT 42.9%; Ozkan YORGANCIOGLU is "TRNC prime minister"

area under government control:

Citizens' Alliance or SP [Giorgos LILLIKAS]; Democratic Party or DIKO [Nicolas PAPADOPOULOS]; Democratic Rally or DISY [Averof NEOPHYTOU (Neofytou)]; European Party or EVROKO [Dimitris SYLLOURIS]; Ecological and Environmental Movement of KOP (Green Party) [Giorgos PERDIKIS]; Movement of Social Democrats or KS-EDEK [Yiannakis OMIROU]; National Popular Front or ELAM [Christos CHRISTOU]; Progressive Party of the Working People or AKEL (Communist Party) [Andros KYPRIANOU]; Frontt for the Restoration of the Center or EPALXI [Kypros CHRYSOSTOMIDIS]; United Democrats or EDI [Praxoula ANTONIADOU]

area administered by Turkish Cypriots:

Communal Democracy Party or TDP [Cemal OZYIGIT]; Cyprus Socialist Party or KSP [Mehmet BIRINCI]; Democrat Party- National Forces or DP-UG [Serdar DENKTAS]; National Unity Party or UBP [Huseyin OZGURGUN]; New Cyprus Party or YKP [Murat KANATLI]; Republican Turkish Party-United Forces or CTP-BG [Ozkan YORGANCIOGLU]; United Cyprus Party or BKP [Izzet IZCAN]

• white with a copper-colored silhouette of the island (the name Cyprus is derived from the Greek word for copper) above two green crossed olive branches in the center of the flag;
• the branches symbolize the hope for peace and reconciliation between the Greek and Turkish communities

note: the "Turkish Republic of Northern Cyprus" flag retains the white field of the Cyprus national flag but displays narrow horizontal red stripes positioned a small distance from the top and bottom edges between which are centered a red crescent and a red five-pointed star;

the banner is modeled after the Turkish national flag but with the colors reversed

The area of the Republic of Cyprus under government control has a market economy dominated by the service sector, which accounts for four-fifths of GDP. Tourism, financial services, and real estate have traditionally been the most important sectors. Cyprus has been a member of the European Union (EU) since May 2004 and adopted the euro as its national currency in January 2008.

During the first five years of EU membership, the Cyprus economy grew at an average rate of about 4%, with unemployment between 2004 and 2008 averaging about 3%. An overextended banking sector with excessive exposure to Greek debt resulted in a contraction in economic growth. Two of Cyprus' biggest banks were among the largest holders of Greek bonds in Europe and had a substantial presence in Greece through bank branches and subsidiaries.

Following numerous downgrades of its credit rating, Cyprus lost access to international capital markets in May 2011. The economy contracted by an accumulated 8.2% between 2009 and 2013 and is not expected to return to positive growth before 2015. Unemployment is currently over 17% and expected to reach 19% in 2014.

In July 2012, Cyprus became the fifth eurozone government to request an economic bailout program from the European Commission, European Central Bank and the International Monetary Fund - known collectively as the "Troika". Shortly after the election of President Nicos ANASTASIADES in February 2013, Cyprus faced an economic crisis and agreed with the Troika to a $13 billion bailout that included losses on uninsured bank deposits.

The bailout triggered a two-week bank closure and the imposition of capital controls, some of which remained in place through 2014. Cyprus' two largest banks merged and the combined entity was recapitalized through conversion of some large bank deposits to shares and imposition of losses on some bank bondholders.

The Troika conditioned the bailout on progress in financial and structural reforms and privatization of state-owned enterprises. Cyprus has downsized and restructured its banking sector significantly. Three positive reviews by the Troika since May 2013 indicate that Cyprus’ bailout program is on track with a fourth review scheduled in May 2014.

In October 2013, Cyprus completed preliminary appraisal of hydrocarbon deposits in its territorial waters, which revealed less than anticipated natural gas reserves. Additional exploration drilling is likely to continue in 2014-2015.

Economy - overview:

The market-based economy of the area administered by Turkish Cypriots, known locally as the "Turkish Republic of Northern Cyprus" ("TRNC"), is roughly half the size of its southern neighbor and is likewise dominated by the service sector with a large portion of the population employed by the government. Since its creation, the "TRNC" has heavily relied on financial assistance from Turkey which supports the "TRNC" defense, telecommunications, water and postal services, and the "TRNC" remains vulnerable to the Turkish market and monetary policy through its use of the Turkish Lira. The "TRNC" weathered the European financial crisis relatively unscathed-compared to the Republic of Cyprus-because of the lack of financial sector development, health of the Turkish economy, and its separation from the rest of the island.

GDP (purchasing power parity):

$1.829 billion (2007 est.)

GDP - real growth rate:

-0.6% (2010 est.)

GDP - per capita:

$11,700 (2007 est.)

GDP - composition by sector:

agriculture:

8.6%, industry: 22.4%, services: 69.1% (2006 est.)

Labor force:

95,030 (2007 est.)

Labor force - by occupation:

agriculture:

14.5%, industry: 29%, services: 56.5% (2004)

Unemployment rate:

9.4% (2005 est.)

Population below poverty line:

%NA

Inflation rate:

11.4% (2006)

Budget:

revenues:

$2.5 billion, expenditures: $2.5 billion (2006)

Agriculture - products:

citrus fruit, dairy, potatoes, grapes, olives, poultry, lamb

Industries:

foodstuffs, textiles, clothing, ship repair, clay, gypsum, copper, furniture

Industrial production growth rate:

-0.3% (2007 est.)

Electricity production:

998.9 million kWh (2005)

Electricity consumption:

797.9 million kWh (2005)

Exports:

$68.1 million, f.o.b. (2007 est.)

Export - commodities:

citrus, dairy, potatoes, textiles

Export - partners:

Turkey 40%; direct trade between the area administered by Turkish Cypriots and the area under government control remains limited

Imports:

$1.2 billion, f.o.b. (2007 est.)

Import - commodities:

vehicles, fuel, cigarettes, food, minerals, chemicals, machinery

Import - partners:

Turkey 60%; direct trade between the area administered by Turkish Cypriots and the area under government control remains limited

Reserves of foreign exchange and gold:

$NA

Debt - external:

$NA

Currency (code):

Turkish new lira (YTL)

Exchange rates:

Turkish new lira per US dollar:

1.668 (2011) 1.5026 (2010) 1.55 (2009) 1.3179 (2008) 1.319 (2007)