Andreas Mavroyiannis, Deputy Minister for European Affairs for Cyprus HARDtalk


Andreas Mavroyiannis, Deputy Minister for European Affairs for Cyprus

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leadership group. Those are the latest headlines. Now on BBC News,

:00:04.:00:14.
:00:14.:00:15.

The European Union won the Nobel Peace Prize for fostering unity in

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Europe. Ironically the award was made during the current EU

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presidency of its only divided member, Cyprus. Since 1974 it has

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been partitioned between the Turkish North and the South. Cyprus

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is also presiding over the biggest crisis in the EU's history,

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financial meltdown triggered by indebted nations and Cyprus itself.

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My guest today on HARDtalk is Andreas Mavroyiannis, a

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distinguished career diplomat who is currently deputy minister for

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European affairs for Cyprus. Does he believe the peace prize is a

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shop in the arm for the EU which will help boost confidence and

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bring vital momentum to find a blueprint for recovery? -- shot in

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Andreas Mavroyiannis, welcome to HARDtalk. Thank you. The Nobel

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peace prize given to the European Union for fostering unity and

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stability, but that is a backward looking thing, don't you think?

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I think it was well deserved. The European project is the most

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formidable piece project in the world over the last 50 years. A

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very successful one. It has replaced Morse and bullets with

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words. Today we have a European Union. -- walls. It is a reminder

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that what we are doing in Europe is not just meeting and greeting, it

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is a political project. Are you really suggesting that any body

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really thinks France and Germany could ever be at war again? If it

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were not for the European project I would not exclude it. But the

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project is so successful that it is not imaginable any more. So this is

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a big success and therefore I'm very happy that the union was

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recognised as such, and the Nobel prize is a reminder to everybody

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that what we are doing here is a political project. E is the irony

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not lost on you, the fact that Cyprus presides over the European

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Union as current President, the rotating presidency, when the award

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was made, but you are the only divided member. That really is

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ironic, isn't it? No, I don't agree with you. It is ironic exclamation

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mark I don't think it is ironic. shows the dynamic of the process. I

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believe the individuals in Cyprus will not be able to survive the

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further progress of the European project. Therefore I believe that

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this is a boost for unity, it is a boost for solving problems. We did

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not manage to solve the Cyprus problem so long. You have even gone

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backwards, that is an understatement. Let me remind you

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what you said in July when Cyprus, the presidency, you said that it

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provides a strong message for Cyprus, that if we can meet

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together as half a billion Europeans, isn't it a complete

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anachronism to think we cannot live with our Turkish compatriots?

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Absolutely. Yes, but 840,000 Greek Cypriots and about 300,000 Turkish

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Cypriots, not all of them Turkish Cypriots, some settlers from

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mainland Turkey. But the fact of the matter is you can't. Unity is

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something that is totally eluding you. So far. But we have no other

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choice and we don't lose hope. We are going to continue working hard

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in order to Unite the country. Because there is this fundamental

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philosophical question you mentioned, how can we in this world

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today be able to be with half a billion of our fellow Europeans

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when we cannot be with our fellow compatriots? This is anachronistic.

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The Greek Cypriot people are the ones who did not vote for unity in

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2004, the Turkish part of the island said yes, fine. If you look

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at the latest polls, 55 % of Greek Cypriots say no, they think they

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are better off separate. First in 2004 there was a referendum, which

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was rejected by the Greek Cypriots because they felt that the basic

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requirements for resettlement were not met and it was a bad settlement

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for them. We need to respect the decision of the people. If the only

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answer you accept is yes, why do you ask the question? But you still

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don't have the people on board. Wait. They rejected a particular

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plan, they have not rejected the idea. Now what is happening in

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particular with the younger generation, they have a longing for

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a normal society. So they are not ready to Pavey for the spoils of

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the past -- to pay. We want a united country and you will see the

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majority, the overwhelming majority, both of Greek Cypriot and Turkish

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Cypriots want the unification of the country. You have missed the

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opportunity, when the President came to power in 2008 he said his

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priority was to work for unity. He had a potential partner then with

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the Turkish Cypriot leader who also entered into negotiations with him.

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Now in 2010, when you have a new leader in the Turkish part of the

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island, he is pro independence. You don't even have a negotiating

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partner any more? This is true. It is true that he is not a person who

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works for unification and this is a problem. But we will not give up

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because we don't believe that there's any alternative to finding

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a negotiated settlement to unify the island. Now don't forget, today,

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even with the division, the Turkish Cypriots are citizens of the

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Republic of Cyprus, they have a passport of Cyprus, they are

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European citizens who can go around and benefit in Europe individually.

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They see themselves as living in a different country. It is only the

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northern Turkish Republic of Cyprus recognised by mainland Turkey...

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is not a country from the legal point of view, though. But Turkey

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recognises it. It is in a de facto situation, they have troops

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occupying the land. But you cannot blame the individual Turkish

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Cypriots for what has happened. But at the end of the day I believe

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that we need to work more with them and make sure that we are going to

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manage to find a way to unify the country. You're a very influential

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man in Cyprus. Am I? I think you are. You have worked as the

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ambassador at the United Nations for Cyprus and also as ambassador

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at the European Union, curate Vice- President now on European affairs.

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-- you would eyes the President. But you said you are not going to

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contest elections in 20 the President. Jong -- in 2014 -- your

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advice. He is very pessimistic. He knows in the coming months there's

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no chance because in order to change the situation we need to

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change the Turkish policy. We don't see this coming. You can talk with

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him. He was really in favour of reunification and we were very

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happy with the fact that he was the leader. But the real problem is

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Turkey and Turkey does not feel at this juncture, but I hope things

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will change, that they have any reason or any incentive to do

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anything. The European Union values Turkey tremendously, a very key

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allied if you see what is going on in Syria, and one of Nato's big

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players, they are always going to side with Turkey much more than

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they are going to listen to you. Isn't that the case? Not really. We

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are a member of the European Union and there is European solidarity.

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But having said that Turkey is a very important strategic partner

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for many big countries in the European Union. Turkey is also a

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country who is a candidate to join the European Union. As far as we

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are concerned we have invested in the accession process in order to

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change the dynamics and find a settlement. It has not worked so

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far, we hope it will work in the future. Of the key sticking points

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broadly speaking, property rights, territorial adjustments among other

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things. And also the government is a big issue. In a paragraph what

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are the key obstacles? The key obstacles, there's the fact that

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Turkey wants to keep control of Cyprus. So the system of security

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and guarantees that existed since 1960, and which was used as a free-

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kick for the invasion. They want to keep that. Second is the system of

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government. It is important for us to have a unified country being

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able to speak with one voice, at least in the European Union. What

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they promote is a kind of concealed division, a kind of confederation,

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that cannot work. Then there is the territorial issue, property rights,

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human rights. There has been a population shift with Greek

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Cypriots? This is a nice way to put it because there was first the

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Cypriot population. The oil and gas reserves of off the shore of Cyprus,

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how much did that help a settlement in the future? -- could at help.

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What you are saying is rational and reasonable. -- Could that help. But

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so are we see the opposite. We see Turkey flattening Cyprus because we

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are exploring our resources in our exclusive economic zone. What is

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happening is that for Turkey, if it was possible to sink Cyprus, they

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would have done so. We provide an alternative access to the Middle

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East. They cannot monopolise access. Second, because we can't provide an

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alternative corridor to Europe for oil and gas. And because they would

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have liked Cyprus not to exist in order to divide the Mediterranean

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between Turkey and Egypt. Cyprus does exist, obviously. I hope that

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they will realise that instead of having this approach, it would have

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been better to reverse this vicious circle and create a new solution,

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working together, co-operating on this important issue and then this

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would have been a good step for finding a settlement. But it could

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be a source of tensions, Cyprus is just going ahead and exploring and

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you say that you could be exporting by 2017. It might cause tensions.

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But we are acting in for conformity with the international law and the

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UN conventions -- full. And the international community as a whole,

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the Security Council and all the big powers, it is rare to say that

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what the Cyprus government is doing is within their own rights.

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final point, you have still got the Green Line dividing the island, you

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have got the longest serving UN mission still there. There's no

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possibility of conflict is there? Always there's a possibility of

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conflict. But I think there's much more maturity now and we will try

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the if you like to avoid possible sources of tension. But the best

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way to avoid tensions his negotiations. And also working for

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a settlement. -- is negotiations. The Nobel Prize given on your watch,

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when you are in charge of the presidency, is ironic when we have

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discussed you have got these divisions and a clear lack of unity

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and the potential for reunification. In addition to the division, Cyprus

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is staring financial disaster in the face because obviously the

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Greek part of Cyprus is very close to mainland Greece, and very

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heavily exposed to the Greek debt crisis. How much do you need? EUR10

:14:21.:14:31.
:14:31.:14:34.

I am not sure. What happened is that everybody in Europe suffered

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from the economic crisis. But then, do this was added the exposure of

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our banks to the bonds problem and the market in general. This made

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the situation not manageable for Cyprus. This is why we asked to be

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under other management. We hope now that we will manage in the coming

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days and weeks to get an agreement and an understanding. Only then

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will we know the exact amount. that figure is about right,

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roughly? A suppose for the size of the country, it should not be very

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far from that. A few GDP is 18.5 billion euros and you want 18 euros,

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that is a lot. But bear in mind that the haircut on Greek bonds

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coursed Cyprus banks more than 4.5 billion. -- 18 billion euros of.

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But the fact of the matter is, Cyprus massively over invested in

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Greek bonds, especially as the Greek economy was crashing.

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Interest rates became more tempting. So it is actually through Cyprus'

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own folly that you find yourself in this position? Yes. You accept

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that? Because you finance minister has a slightly different take on it.

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She says that Greece is the root of the problem. She says the situation

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of Cyprus would have been under control if it was not full Greece

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but that seems like they are trying to play the blame game close enough

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:16:28.:16:28.

no. Nobody forced the Supre it -- cypress' banks to buy Greek bonds.

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They had operations in Greece and suffered from these potentially.

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But the real problem was the bonds. They bought them because they

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wanted to stabilise... He was tending? Absolutely. -- it was

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tempting. Super League got the best of them? A view can put it like

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that. -- so, greed got the best. you get your theocracy in Cyprus,

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it is bloated and parallels to Greece in a way. You civil servant

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salary accounts for nearly one third of GDP. For yes. That is a

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lot for a small island of 845,000 people. You are half-right on this,

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in the sense that I believe that overall we have an efficient public

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sector in price -- in Cyprus. A small public sector, which manages

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very well. On this, you are not right. But you are right when you

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say the percentage and you are right that we have to recognise

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that traditionally, the situ -- civil servants in Cyprus are well

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paid and a privilege. Will they get salary cuts? I suppose they will.

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They have already. More? This is part of the discussion. Most

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probably we will end up at least with some temporary deductions, yes.

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A because the President has said that he will do as much as he can

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to resist the austerity measures. Yes. He is very left of centre.

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Resist austerity measures. He means by that to protect the working

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class. He is leftist in origin and he wants to preserve the working

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class. He does not want people that do not earn much having to pay the

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price. And that his seat. But he never said that we would not do any

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cuts in the public sector or reduce salaries there. Aren't you worried

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about the anger that could be provoked among the people? I want

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to dwell on this because the leader of the left-wing party has said

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that the debt crisis in Greece risks ruining the European ideal. A

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Europe split into north and south. And the only way he says this is --

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this can survive is through solidarity. He goes on to make the

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point that you can see a far-right party, the neo- Nazi party, gaining

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a greater amount of popularity increase as people's angle

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increases. Are you worried about anything like that? -- anger.

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Nobody is immune from this kind of phenomenon. At the same time, in

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Cyprus, we are used to having labour and industrial relations

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through a very consensual dialogue. Even now, in these difficult times,

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we try our best to have partners onboard. It is not always easy. But

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I believe we do not need to have the same situation as in Greece. If

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the measures are temporary and if we keep some fundamental notions of

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solidarity, and if you like the social safety net and the automatic

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stabilisers that exist in European economies, we will manage. And is

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it that challenge that will define the European Union now? We talked

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about the Nobel Prize and have the values of unity and stability were

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important them. But, surely now, the challenge for the EU is how it

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responds to the higher unemployment that we see unprecedented and the

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poverty that we also see? It has got to find a narrative that

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appeals both to be people in power and also to the people in

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countries? You said it all. I agree 100%. This is a big challenge.

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Today, what we see his distance between citizens and institutions.

:20:56.:21:01.

That is because we are not convincing, we are not credible and

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people have no confidence. We need... This is the message of the

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Cyprus threatened. We need a better Europe, which has to be more

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relevant to the citizens. -- site this precedent. In times of crisis,

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we need to go forward with fiscal consolidation. This is a

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prerequisite. But, at the same time, and there was this shift of

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paradigm in recent months, we need to foster growth, job creation, we

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need more social cohesion and solidarity, and we need to create a

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future for our children. Because you have many people unemployed now

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in the 17 Europe countries. We need to restore confidence. What is the

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vision? Francois Hollande says that they believe in sovereignty. The

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Germans say they want more of Europe. They want to have a say in

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national budgets. They say indebted nations need to know that there is

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some kind of influence in that. There are two competing visions.

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Yes. But I believe personally that this is the wrong debate. What we

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need now is to do what it takes in order to go forward and solve the

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problems and get Europe out of the crisis. This is why I am the

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President is saying a better Europe. Europe is part of the solution and

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not the problem. This debate offer more Europe and less Europe, more

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or less sovereignty, this is a debate that will go on forever.

:22:47.:22:52.

Let's get the job done and then we will give a name to the baby. It is

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not the time for this. Of course the discussions will continue. I

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don't mind if, in order to solve the economic problems of Europe, we

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have to look closer to the national budget. We need to do whatever it

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takes. How confident are you? You are enduring the worst fire --

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worst crisis in the financial history. The Nobel Prize was given

:23:20.:23:24.

to you because of what you did in the past but could that act as a

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shot in the arm for the EU to try to galvanise everybody together, to

:23:28.:23:35.

try to find a blueprint for recovery? I wouldn't agree more.

:23:35.:23:42.

do believe exactly this, yes! will cement the European Union in

:23:42.:23:47.

order to work harder, in order to find necessary solutions. Now, that

:23:47.:23:51.

we are working for a genuine economic and monetary union, which

:23:51.:23:55.

will manage to bring together both the monetary dimension, the

:23:55.:23:59.

economic dimension, the budgetary dimension and the democratic

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dimension. Of course, we don't change the situation from one day

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