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Cyprus "TURKISH REPUBLIC OF NORTHERN CYPRUS"
Between 1963 and 1974, the economy of the Turkish
Cypriot
community was that of an underdeveloped society. Much of
this
backwardness resulted from the economic blockade imposed
by Greek
Cypriots on the Turkish Cypriot enclaves, which largely
cut them
off from the outside world. The geographical separation of
the
enclaves from one another only worsened their plight. In
addition
to external obstacles, Turkish Cypriots were not a notably
commercial people or much involved in the island's limited
manufacturing sector. Most Turkish Cypriots earned their
livelihood
from farming or government employment. By the early 1970s,
Turkish
Cypriots accounted for only 6 percent of the island's
gross
domestic product
(GDP--see Glossary), although they
constituted
about 20 percent of its population.
The harsh economic conditions began to change after the
Turkish
intervention of 1974 and the subsequent de facto partition
of
Cyprus. The Turkish Cypriots formed their own "state" in
1975, and
in 1983 declared the area they occupied in northern Cyprus
to be
the "Turkish Republic of Northern Cyprus" ("TRNC"). Once
they had
their own contiguous territory and government, Turkish
Cypriots
began to work toward economic development. Their efforts
were aided
by significant financial and technical assistance from
Turkey and
an influx of workers from that country. Some of these
workers came
as settlers. Others were Turkish Cypriots who had left the
island
during the violent and uncertain 1963-74 period.
The Turkish Cypriots had some success in fashioning a
working
economy. The GDP of the "TRNC" nearly doubled in real
terms between
1977 and 1990 (see
table 17, Appendix). According to
Turkish
Cypriot statistics, the GDP of the "TRNC" grew at an
average annual
rate of 6.4 percent between 1977 and 1988. The rate of
growth was
7.5 percent in 1988 and 7.1 percent in 1989, and similar
growth was
expected in 1990.
In addition to healthy growth rates, the economy was
becoming
more modern in structure. In 1989 industry's share of GDP
was 14
percent and surpassed for the first time agriculture's
share of
10.9 percent (see
table 18, Appendix). Services
represented nearly
half of GDP, although an unhealthy proportion of this
share stemmed
from government services and employment.
Turkish Cypriots still lagged far behind Greek Cypriots
economically. For example, per capita income increased
from US$586
in 1974 to US$2,245 in 1989, but was only a third of the
level
achieved in the Republic of Cyprus. Turkish Cypriots often
contended that many of their economic difficulties stemmed
from the
Greek Cypriot effort to impose an economic blockade,
cutting them
off from the rest of the world except Turkey. There was
another
cause of difficulties: because the "TRNC" was recognized
only by
Turkey, most international economic assistance to Cyprus
from
international organizations such as the
World Bank (see Glossary)
and the European Community
(EC--see Glossary) went to the
Republic
of Cyprus. In short, although the Turkish Cypriots had
achieved a
measure of political independence and economic success, by
late
1990 the "TRNC" still lacked the external recognition
necessary for
greater economic development.
Data as of January 1991
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