Medvedev reassures Greek Cypriots on Turkey ties

7th October 2010, Comments 0 comments

Russian President Dmitry Medvedev assured Greek Cypriot leaders on Thursday that his country's growing trade ties with common historic rival Turkey do not mean that Moscow will abandon their interests.

On the first ever visit to the Mediterranean island by a Russian head of state, Medvedev said that Russia and Cyprus remained bound by a shared Orthodox Christian religion and Moscow would do all in its power to support Greek Cypriots secure a just resolution of the island's 36-year division.

"I will answer directly -- this (closer ties with Turkey) does not threaten Cyprus with anything. The position on a Cyprus settlement remains unchanged," Medvedev said.

"We will assist in settling this problem in every possible way."

Cyprus's internationally recognised Greek Cypriot government has long looked to Russia for support in resisting Western-backed peace proposals for reunifying the island that it charges have been weighted towards Turkish interests.

In April 2004, Moscow used its veto as a Security Council permanent member to block adoption of a British- and US-sponsored draft resolution endorsing a UN reunification blueprint that was strongly opposed by the Cypriot government.

It was the first time in a decade that Russia had used its veto.

The Cyprus president paid tribute to Moscow's backing.

"The Soviet Union and later the Russian Federation have always supported Cyprus, playing an active and decisive role in protecting the independence, sovereignty and territorial integrity of the Republic of Cyprus at the UN Security Council," Christofias said.

In an opinion piece published by the Cyprus daily Phileleftheros, Medvedev renewed Russian support for the Greek Cypriot position that no deadline should be set for UN-brokered reunification talks with the Turkish Cypriots and that there should be no outside arbitration.

"We have consistently been in favour of the Cyprus problem being solved without outside pressure, with the agreement of both sides," the Russian president said

"It is obvious for us that attempts to impose here ready-made 'recipes' or an artificial schedule of inter-community negotiations and especially to establish terms for their completion and introduce outside arbitration are counterproductive."

Cyprus has become a popular destination for Russian capital -- official figures show that investment in Russia through Cyprus over the past five years has totalled 52.18 billion dollars (37.54 billion euros), while Russian investment in Cyprus reached 15.96 billion dollars (12.37 billion euros).

Russian Deputy Finance Minister Sergei Shatalov signed a new tax agreement to cover Russian investments, one of 15 accords to be inked during Medvedev's visit.

"Cyprus is effectively the offshore financial services centre for Russia," said Chris Weafer, chief strategist at Russia's UralSib investment bank.

"Moscow is keen to ensure that the island state is not used as a tax evasion centre -- or, at least not for much longer."

The Cyprus president hailed the taxation agreement as a milestone in boosting ties.

"We have worked together so that the possibility of casting shadows over whether the money is clean is removed out of the way," Christofias said.

Medvedev acknowledged Cyprus was an attractive destination for Russian money.

"This is why we are interested in relations in this sphere being clear, transparent because money can indeed be different," he said.

The tax agreement is aimed at making this sphere "yet more predictable, transparent and comprehensible for control of the authorities."

The official Cyprus News Agency reported that Moscow had "persuaded the Cypriot authorities of the need to simplify the procedure and without court intervention, to supply information, following a request by Russian tax institutions, regarding companies, their founders and their shareholders."

At the same time, Cyprus is asking Russia to reach similar agreements with other countries that provide offshore services such as Switzerland, Luxembourg, Austria and the Netherlands.

© 2010 AFP

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