:00:04. > :00:14.leadership group. Those are the latest headlines. Now on BBC News,
:00:14. > :00:15.
:00:15. > :00:22.The European Union won the Nobel Peace Prize for fostering unity in
:00:22. > :00:27.Europe. Ironically the award was made during the current EU
:00:27. > :00:33.presidency of its only divided member, Cyprus. Since 1974 it has
:00:33. > :00:38.been partitioned between the Turkish North and the South. Cyprus
:00:38. > :00:43.is also presiding over the biggest crisis in the EU's history,
:00:43. > :00:47.financial meltdown triggered by indebted nations and Cyprus itself.
:00:47. > :00:51.My guest today on HARDtalk is Andreas Mavroyiannis, a
:00:51. > :00:55.distinguished career diplomat who is currently deputy minister for
:00:55. > :00:59.European affairs for Cyprus. Does he believe the peace prize is a
:00:59. > :01:04.shop in the arm for the EU which will help boost confidence and
:01:04. > :01:14.bring vital momentum to find a blueprint for recovery? -- shot in
:01:14. > :01:32.
:01:32. > :01:36.Andreas Mavroyiannis, welcome to HARDtalk. Thank you. The Nobel
:01:36. > :01:40.peace prize given to the European Union for fostering unity and
:01:41. > :01:48.stability, but that is a backward looking thing, don't you think?
:01:49. > :01:53.I think it was well deserved. The European project is the most
:01:53. > :01:58.formidable piece project in the world over the last 50 years. A
:01:58. > :02:05.very successful one. It has replaced Morse and bullets with
:02:05. > :02:11.words. Today we have a European Union. -- walls. It is a reminder
:02:11. > :02:15.that what we are doing in Europe is not just meeting and greeting, it
:02:15. > :02:19.is a political project. Are you really suggesting that any body
:02:19. > :02:24.really thinks France and Germany could ever be at war again? If it
:02:24. > :02:29.were not for the European project I would not exclude it. But the
:02:29. > :02:33.project is so successful that it is not imaginable any more. So this is
:02:33. > :02:39.a big success and therefore I'm very happy that the union was
:02:39. > :02:44.recognised as such, and the Nobel prize is a reminder to everybody
:02:44. > :02:50.that what we are doing here is a political project. E is the irony
:02:50. > :02:54.not lost on you, the fact that Cyprus presides over the European
:02:54. > :02:58.Union as current President, the rotating presidency, when the award
:02:58. > :03:03.was made, but you are the only divided member. That really is
:03:03. > :03:11.ironic, isn't it? No, I don't agree with you. It is ironic exclamation
:03:11. > :03:15.mark I don't think it is ironic. shows the dynamic of the process. I
:03:15. > :03:19.believe the individuals in Cyprus will not be able to survive the
:03:19. > :03:25.further progress of the European project. Therefore I believe that
:03:25. > :03:30.this is a boost for unity, it is a boost for solving problems. We did
:03:30. > :03:34.not manage to solve the Cyprus problem so long. You have even gone
:03:34. > :03:38.backwards, that is an understatement. Let me remind you
:03:38. > :03:42.what you said in July when Cyprus, the presidency, you said that it
:03:42. > :03:45.provides a strong message for Cyprus, that if we can meet
:03:45. > :03:49.together as half a billion Europeans, isn't it a complete
:03:49. > :03:57.anachronism to think we cannot live with our Turkish compatriots?
:03:57. > :04:03.Absolutely. Yes, but 840,000 Greek Cypriots and about 300,000 Turkish
:04:03. > :04:09.Cypriots, not all of them Turkish Cypriots, some settlers from
:04:09. > :04:14.mainland Turkey. But the fact of the matter is you can't. Unity is
:04:14. > :04:18.something that is totally eluding you. So far. But we have no other
:04:18. > :04:24.choice and we don't lose hope. We are going to continue working hard
:04:24. > :04:28.in order to Unite the country. Because there is this fundamental
:04:28. > :04:32.philosophical question you mentioned, how can we in this world
:04:32. > :04:38.today be able to be with half a billion of our fellow Europeans
:04:38. > :04:43.when we cannot be with our fellow compatriots? This is anachronistic.
:04:43. > :04:47.The Greek Cypriot people are the ones who did not vote for unity in
:04:47. > :04:55.2004, the Turkish part of the island said yes, fine. If you look
:04:55. > :05:01.at the latest polls, 55 % of Greek Cypriots say no, they think they
:05:01. > :05:08.are better off separate. First in 2004 there was a referendum, which
:05:08. > :05:12.was rejected by the Greek Cypriots because they felt that the basic
:05:12. > :05:18.requirements for resettlement were not met and it was a bad settlement
:05:18. > :05:25.for them. We need to respect the decision of the people. If the only
:05:25. > :05:30.answer you accept is yes, why do you ask the question? But you still
:05:30. > :05:34.don't have the people on board. Wait. They rejected a particular
:05:34. > :05:39.plan, they have not rejected the idea. Now what is happening in
:05:39. > :05:45.particular with the younger generation, they have a longing for
:05:45. > :05:51.a normal society. So they are not ready to Pavey for the spoils of
:05:51. > :05:55.the past -- to pay. We want a united country and you will see the
:05:55. > :06:00.majority, the overwhelming majority, both of Greek Cypriot and Turkish
:06:00. > :06:03.Cypriots want the unification of the country. You have missed the
:06:03. > :06:09.opportunity, when the President came to power in 2008 he said his
:06:09. > :06:13.priority was to work for unity. He had a potential partner then with
:06:13. > :06:18.the Turkish Cypriot leader who also entered into negotiations with him.
:06:18. > :06:22.Now in 2010, when you have a new leader in the Turkish part of the
:06:22. > :06:31.island, he is pro independence. You don't even have a negotiating
:06:31. > :06:35.partner any more? This is true. It is true that he is not a person who
:06:35. > :06:39.works for unification and this is a problem. But we will not give up
:06:39. > :06:45.because we don't believe that there's any alternative to finding
:06:45. > :06:50.a negotiated settlement to unify the island. Now don't forget, today,
:06:50. > :06:54.even with the division, the Turkish Cypriots are citizens of the
:06:54. > :07:01.Republic of Cyprus, they have a passport of Cyprus, they are
:07:02. > :07:07.European citizens who can go around and benefit in Europe individually.
:07:07. > :07:12.They see themselves as living in a different country. It is only the
:07:12. > :07:19.northern Turkish Republic of Cyprus recognised by mainland Turkey...
:07:19. > :07:24.is not a country from the legal point of view, though. But Turkey
:07:24. > :07:28.recognises it. It is in a de facto situation, they have troops
:07:28. > :07:32.occupying the land. But you cannot blame the individual Turkish
:07:32. > :07:37.Cypriots for what has happened. But at the end of the day I believe
:07:37. > :07:41.that we need to work more with them and make sure that we are going to
:07:41. > :07:47.manage to find a way to unify the country. You're a very influential
:07:47. > :07:51.man in Cyprus. Am I? I think you are. You have worked as the
:07:51. > :07:56.ambassador at the United Nations for Cyprus and also as ambassador
:07:56. > :08:00.at the European Union, curate Vice- President now on European affairs.
:08:00. > :08:10.-- you would eyes the President. But you said you are not going to
:08:10. > :08:18.
:08:18. > :08:24.contest elections in 20 the President. Jong -- in 2014 -- your
:08:24. > :08:28.advice. He is very pessimistic. He knows in the coming months there's
:08:28. > :08:35.no chance because in order to change the situation we need to
:08:35. > :08:39.change the Turkish policy. We don't see this coming. You can talk with
:08:39. > :08:47.him. He was really in favour of reunification and we were very
:08:47. > :08:51.happy with the fact that he was the leader. But the real problem is
:08:51. > :08:55.Turkey and Turkey does not feel at this juncture, but I hope things
:08:55. > :09:02.will change, that they have any reason or any incentive to do
:09:02. > :09:06.anything. The European Union values Turkey tremendously, a very key
:09:06. > :09:12.allied if you see what is going on in Syria, and one of Nato's big
:09:12. > :09:18.players, they are always going to side with Turkey much more than
:09:18. > :09:23.they are going to listen to you. Isn't that the case? Not really. We
:09:23. > :09:28.are a member of the European Union and there is European solidarity.
:09:28. > :09:32.But having said that Turkey is a very important strategic partner
:09:32. > :09:37.for many big countries in the European Union. Turkey is also a
:09:37. > :09:44.country who is a candidate to join the European Union. As far as we
:09:44. > :09:48.are concerned we have invested in the accession process in order to
:09:48. > :09:53.change the dynamics and find a settlement. It has not worked so
:09:53. > :10:00.far, we hope it will work in the future. Of the key sticking points
:10:00. > :10:05.broadly speaking, property rights, territorial adjustments among other
:10:05. > :10:10.things. And also the government is a big issue. In a paragraph what
:10:10. > :10:14.are the key obstacles? The key obstacles, there's the fact that
:10:14. > :10:23.Turkey wants to keep control of Cyprus. So the system of security
:10:23. > :10:29.and guarantees that existed since 1960, and which was used as a free-
:10:29. > :10:32.kick for the invasion. They want to keep that. Second is the system of
:10:32. > :10:38.government. It is important for us to have a unified country being
:10:38. > :10:43.able to speak with one voice, at least in the European Union. What
:10:43. > :10:50.they promote is a kind of concealed division, a kind of confederation,
:10:50. > :10:54.that cannot work. Then there is the territorial issue, property rights,
:10:54. > :11:01.human rights. There has been a population shift with Greek
:11:01. > :11:11.Cypriots? This is a nice way to put it because there was first the
:11:11. > :11:21.Cypriot population. The oil and gas reserves of off the shore of Cyprus,
:11:21. > :11:21.
:11:21. > :11:26.how much did that help a settlement in the future? -- could at help.
:11:26. > :11:31.What you are saying is rational and reasonable. -- Could that help. But
:11:31. > :11:40.so are we see the opposite. We see Turkey flattening Cyprus because we
:11:40. > :11:47.are exploring our resources in our exclusive economic zone. What is
:11:47. > :11:53.happening is that for Turkey, if it was possible to sink Cyprus, they
:11:53. > :12:01.would have done so. We provide an alternative access to the Middle
:12:01. > :12:09.East. They cannot monopolise access. Second, because we can't provide an
:12:09. > :12:14.alternative corridor to Europe for oil and gas. And because they would
:12:14. > :12:22.have liked Cyprus not to exist in order to divide the Mediterranean
:12:22. > :12:26.between Turkey and Egypt. Cyprus does exist, obviously. I hope that
:12:26. > :12:34.they will realise that instead of having this approach, it would have
:12:34. > :12:37.been better to reverse this vicious circle and create a new solution,
:12:37. > :12:42.working together, co-operating on this important issue and then this
:12:42. > :12:46.would have been a good step for finding a settlement. But it could
:12:46. > :12:52.be a source of tensions, Cyprus is just going ahead and exploring and
:12:52. > :12:57.you say that you could be exporting by 2017. It might cause tensions.
:12:57. > :13:03.But we are acting in for conformity with the international law and the
:13:03. > :13:13.UN conventions -- full. And the international community as a whole,
:13:13. > :13:17.the Security Council and all the big powers, it is rare to say that
:13:17. > :13:21.what the Cyprus government is doing is within their own rights.
:13:21. > :13:26.final point, you have still got the Green Line dividing the island, you
:13:26. > :13:30.have got the longest serving UN mission still there. There's no
:13:30. > :13:35.possibility of conflict is there? Always there's a possibility of
:13:35. > :13:42.conflict. But I think there's much more maturity now and we will try
:13:42. > :13:46.the if you like to avoid possible sources of tension. But the best
:13:46. > :13:52.way to avoid tensions his negotiations. And also working for
:13:52. > :13:56.a settlement. -- is negotiations. The Nobel Prize given on your watch,
:13:56. > :14:00.when you are in charge of the presidency, is ironic when we have
:14:00. > :14:05.discussed you have got these divisions and a clear lack of unity
:14:05. > :14:10.and the potential for reunification. In addition to the division, Cyprus
:14:10. > :14:14.is staring financial disaster in the face because obviously the
:14:14. > :14:21.Greek part of Cyprus is very close to mainland Greece, and very
:14:21. > :14:31.heavily exposed to the Greek debt crisis. How much do you need? EUR10
:14:31. > :14:34.
:14:34. > :14:43.I am not sure. What happened is that everybody in Europe suffered
:14:43. > :14:48.from the economic crisis. But then, do this was added the exposure of
:14:48. > :14:55.our banks to the bonds problem and the market in general. This made
:14:55. > :15:01.the situation not manageable for Cyprus. This is why we asked to be
:15:01. > :15:05.under other management. We hope now that we will manage in the coming
:15:05. > :15:09.days and weeks to get an agreement and an understanding. Only then
:15:09. > :15:15.will we know the exact amount. that figure is about right,
:15:15. > :15:20.roughly? A suppose for the size of the country, it should not be very
:15:20. > :15:29.far from that. A few GDP is 18.5 billion euros and you want 18 euros,
:15:29. > :15:36.that is a lot. But bear in mind that the haircut on Greek bonds
:15:36. > :15:41.coursed Cyprus banks more than 4.5 billion. -- 18 billion euros of.
:15:41. > :15:45.But the fact of the matter is, Cyprus massively over invested in
:15:45. > :15:51.Greek bonds, especially as the Greek economy was crashing.
:15:51. > :15:57.Interest rates became more tempting. So it is actually through Cyprus'
:15:57. > :16:04.own folly that you find yourself in this position? Yes. You accept
:16:04. > :16:10.that? Because you finance minister has a slightly different take on it.
:16:10. > :16:14.She says that Greece is the root of the problem. She says the situation
:16:14. > :16:18.of Cyprus would have been under control if it was not full Greece
:16:18. > :16:28.but that seems like they are trying to play the blame game close enough
:16:28. > :16:28.
:16:28. > :16:33.no. Nobody forced the Supre it -- cypress' banks to buy Greek bonds.
:16:33. > :16:38.They had operations in Greece and suffered from these potentially.
:16:38. > :16:47.But the real problem was the bonds. They bought them because they
:16:47. > :16:52.wanted to stabilise... He was tending? Absolutely. -- it was
:16:52. > :16:58.tempting. Super League got the best of them? A view can put it like
:16:58. > :17:03.that. -- so, greed got the best. you get your theocracy in Cyprus,
:17:03. > :17:09.it is bloated and parallels to Greece in a way. You civil servant
:17:09. > :17:17.salary accounts for nearly one third of GDP. For yes. That is a
:17:17. > :17:22.lot for a small island of 845,000 people. You are half-right on this,
:17:22. > :17:29.in the sense that I believe that overall we have an efficient public
:17:29. > :17:37.sector in price -- in Cyprus. A small public sector, which manages
:17:37. > :17:42.very well. On this, you are not right. But you are right when you
:17:42. > :17:48.say the percentage and you are right that we have to recognise
:17:48. > :17:54.that traditionally, the situ -- civil servants in Cyprus are well
:17:54. > :18:01.paid and a privilege. Will they get salary cuts? I suppose they will.
:18:01. > :18:08.They have already. More? This is part of the discussion. Most
:18:08. > :18:13.probably we will end up at least with some temporary deductions, yes.
:18:13. > :18:19.A because the President has said that he will do as much as he can
:18:19. > :18:25.to resist the austerity measures. Yes. He is very left of centre.
:18:25. > :18:30.Resist austerity measures. He means by that to protect the working
:18:30. > :18:36.class. He is leftist in origin and he wants to preserve the working
:18:36. > :18:42.class. He does not want people that do not earn much having to pay the
:18:42. > :18:48.price. And that his seat. But he never said that we would not do any
:18:48. > :18:54.cuts in the public sector or reduce salaries there. Aren't you worried
:18:54. > :19:00.about the anger that could be provoked among the people? I want
:19:00. > :19:05.to dwell on this because the leader of the left-wing party has said
:19:05. > :19:10.that the debt crisis in Greece risks ruining the European ideal. A
:19:10. > :19:14.Europe split into north and south. And the only way he says this is --
:19:14. > :19:20.this can survive is through solidarity. He goes on to make the
:19:20. > :19:23.point that you can see a far-right party, the neo- Nazi party, gaining
:19:23. > :19:28.a greater amount of popularity increase as people's angle
:19:28. > :19:36.increases. Are you worried about anything like that? -- anger.
:19:36. > :19:40.Nobody is immune from this kind of phenomenon. At the same time, in
:19:40. > :19:45.Cyprus, we are used to having labour and industrial relations
:19:45. > :19:54.through a very consensual dialogue. Even now, in these difficult times,
:19:54. > :20:00.we try our best to have partners onboard. It is not always easy. But
:20:00. > :20:06.I believe we do not need to have the same situation as in Greece. If
:20:06. > :20:13.the measures are temporary and if we keep some fundamental notions of
:20:13. > :20:17.solidarity, and if you like the social safety net and the automatic
:20:17. > :20:22.stabilisers that exist in European economies, we will manage. And is
:20:22. > :20:26.it that challenge that will define the European Union now? We talked
:20:26. > :20:31.about the Nobel Prize and have the values of unity and stability were
:20:31. > :20:36.important them. But, surely now, the challenge for the EU is how it
:20:36. > :20:40.responds to the higher unemployment that we see unprecedented and the
:20:40. > :20:45.poverty that we also see? It has got to find a narrative that
:20:45. > :20:52.appeals both to be people in power and also to the people in
:20:52. > :20:56.countries? You said it all. I agree 100%. This is a big challenge.
:20:56. > :21:01.Today, what we see his distance between citizens and institutions.
:21:01. > :21:06.That is because we are not convincing, we are not credible and
:21:06. > :21:10.people have no confidence. We need... This is the message of the
:21:10. > :21:15.Cyprus threatened. We need a better Europe, which has to be more
:21:15. > :21:21.relevant to the citizens. -- site this precedent. In times of crisis,
:21:21. > :21:25.we need to go forward with fiscal consolidation. This is a
:21:25. > :21:33.prerequisite. But, at the same time, and there was this shift of
:21:33. > :21:37.paradigm in recent months, we need to foster growth, job creation, we
:21:37. > :21:43.need more social cohesion and solidarity, and we need to create a
:21:43. > :21:47.future for our children. Because you have many people unemployed now
:21:47. > :21:57.in the 17 Europe countries. We need to restore confidence. What is the
:21:57. > :22:01.vision? Francois Hollande says that they believe in sovereignty. The
:22:01. > :22:08.Germans say they want more of Europe. They want to have a say in
:22:08. > :22:12.national budgets. They say indebted nations need to know that there is
:22:13. > :22:17.some kind of influence in that. There are two competing visions.
:22:17. > :22:22.Yes. But I believe personally that this is the wrong debate. What we
:22:22. > :22:31.need now is to do what it takes in order to go forward and solve the
:22:31. > :22:35.problems and get Europe out of the crisis. This is why I am the
:22:35. > :22:42.President is saying a better Europe. Europe is part of the solution and
:22:42. > :22:47.not the problem. This debate offer more Europe and less Europe, more
:22:47. > :22:52.or less sovereignty, this is a debate that will go on forever.
:22:52. > :22:57.Let's get the job done and then we will give a name to the baby. It is
:22:57. > :23:03.not the time for this. Of course the discussions will continue. I
:23:03. > :23:08.don't mind if, in order to solve the economic problems of Europe, we
:23:08. > :23:16.have to look closer to the national budget. We need to do whatever it
:23:16. > :23:20.takes. How confident are you? You are enduring the worst fire --
:23:20. > :23:24.worst crisis in the financial history. The Nobel Prize was given
:23:24. > :23:28.to you because of what you did in the past but could that act as a
:23:28. > :23:35.shot in the arm for the EU to try to galvanise everybody together, to
:23:35. > :23:42.try to find a blueprint for recovery? I wouldn't agree more.
:23:42. > :23:47.do believe exactly this, yes! will cement the European Union in
:23:47. > :23:51.order to work harder, in order to find necessary solutions. Now, that
:23:51. > :23:55.we are working for a genuine economic and monetary union, which
:23:55. > :23:59.will manage to bring together both the monetary dimension, the
:23:59. > :24:04.economic dimension, the budgetary dimension and the democratic
:24:04. > :24:13.dimension. Of course, we don't change the situation from one day