Economic crisis blessing for Cyprus peace deal: UN envoy

An outgoing UN envoy in Cyprus said Thursday that the island's economic crisis may be a blessing in disguise regarding a peace deal eluding Greek and Turkish Cypriots for many decades.

Alexander Downer, a former foreign minister of Australia who served as UN secretary general's personal advisor in Cyprus for seven years, told a press conference that the prospects of economic growth could bring the estranged Greek and Turkish Cypriot communities closer together in seeking a solution, Xinhua reported.

The two communities have been living apart in their respective regions of the eastern Mediterranean island since Turkey occupied its northern part in 1974, in response to a coup by Greek army officers.

"Economic circumstances, harsh as they are, can and have reminded people that a solution is beneficial for the island," Downer said one day after paying farewell visits to Cypriot President Nicos Anastasiades and the Turkish Cypriot leader Dervis Eroglu.

Cyprus went through a shake-down of its economy and banking system last year, which involved a harsh austerity programme, after receiving a $10 billion bailout from the Eurogroup and the International Monetary Fund.

Downer will step down in mid-April to take up a new post as Australia's High Commissioner (ambassador) in London.

He said that should Cyprus were reunited under a peace deal it would attract considerable investment.

PRIO, an international peace research institute working on peace building, has estimated that a Cyprus solution could boost economic growth by 3.8 percent per year, adding 18 billion euros to Cyprus' economy in 20 years.

Greek and Turkish Cypriot negotiators are engaged in a renewed round of negotiations since February 11.

Downer said the process for the solution of the Cyprus problem was in good shape and that there was a positive momentum.