The Effects of Isolation on the Turkish Republic of Northern Cyprus

Gorgulu, Mehmet Emre (2014): The Effects of Isolation on the Turkish Republic of Northern Cyprus. Published in: IX.th International Congress on Cyprus Studies, Eastern Mediterranean University , Vol. IX., (2014)

Abstract

The economic development of the Turkish Republic of Northern Cyprus remains to be volatile mainly due to the isolation of the de facto Turkish Cypriot state. While on one hand, high costs of energy in the Turkish Republic of Northern Cyprus associated with the isolation, remains as a huge obstacle for the increment in Turkish Cypriot production, embargo placed upon her, including closure of ports and airports, on the other, restrains international trade for Turkish Cypriots, thus making the Turkish Cypriot economy a challanged one. Therefore, after indicating the burdensome effects of isolation on the economy of Turkish Republic of Northern Cyprus, this paper proposes how the Turkish Cypriot economy needs to overcome her self-reliance issues and suggests alternative solutions to the Turkish Cypriot economy. For this purpose, by using time-series analysis this paper provides a double-model approach in which the economic growth of the Turkish Republic of Northern Cyprus is mainly dependent on aid transfers from Turkish government and is suffering from isolation in the first, and is determined by the free-trade and free-movement of international capital brought by becoming a transition economy and therefore easing the contractions on the economy, on the hypothetical second model. While the results of the analysis employed in this paper confirms that main problems of Turkish Cypriot economy are associated with the isolation, it also indicates that Turkish Cypriot economy would be better off in an isolation-free environment. Thus, this paper aims to assert the importance of self-determination rights for the Turkish Cypriots.

• Item Type: MPRA Paper
• Language: English
• Keywords: Economic Development, Cyprus Dispute, Economy of the Turkish Republic of Northern Cyprus as a Transition Economy
• Subjects: F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F41 - Open Economy Macroeconomics; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F43 - Economic Growth of Open Economies; F - International Economics > F5 - International Relations, National Security, and International Political Economy > F51 - International Conflicts ; Negotiations ; Sanctions; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O10 - General; P - Economic Systems > P4 - Other Economic Systems > P45 - International Trade, Finance, Investment, and Aid; P - Economic Systems > P4 - Other Economic Systems > P48 - Political Economy ; Legal Institutions ; Property Rights ; Natural Resources ; Energy ; Environment ; Regional Studies

References

CIA, The World Factbook, (2014), https://www.cia.gov/library/publications/the-world-factbook/geos/cy.html#Econ (accessed March 01, 2014)

Eurostat, (2014), http://appsso.eurostat.ec.europa.eu/nui/submitViewTableAction.do (accessed March 06, 2014)

Kıb-tek K.K.T.C. Elektrik Kurumu, (2014), http://www.kibtek.com/Tarifeler/95-2012%20TARIFE%20%C3%9CCRETLERI.pdf (accessed March 04, 2014)

London-Zurich Agreements, (1959), http://web.deu.edu.tr/kibris/articles/app.html (accessed March 17, 2014)

OECD, (2014) OECD Science, Technology and Indusrty Scoreboard 2011 http://www.oecd-ilibrary.org/sites/sti_scoreboard-2011-en/06/06/index.html;jsessionid=dv6h5i4f2nu9.x-oecd-live-01?contentType=&itemId=%2Fcontent%2Fchapter%2Fsti_scoreboard-2011-60-en&mimeType=text%2Fhtml&containerItemId=%2Fcontent%2Fserial%2F20725345&accessItemIds=%2Fcontent%2Fbook%2Fsti_scoreboard-2011-en (accessed March 16, 2014)

Republic of Turkey, DSİ, (2014) KKTC’ye Su Temini Projesi, http://www.dsi.gov.tr/projeler/kktc-su-temin-projesi (accessed March 18, 2014)

Republic of Turkey, Embassy of Lefkosa, Yardım Heyeti Başkanlığı, (2014) KKTC’ye Yapılan TC Yardımları, 2011 Yılı Faaliyet Raporu, http://www.yhb.gov.tr/rapor_online2/index.html#/2011%20Faaliyet%20Raporu/0 (accessed March 10, 2014)

Republic of Turkey, Embassy of Lefkosa, Yardım Heyeti Başkanlığı, (2011) KKTC’ye Yapılan TC Yardımları, 2010 Yılı Faaliyet Raporu, http://www.yhb.gov.tr/rapor_online/index.html#/2010%20Faaliyet%20Raporu/0 (accessed March 09, 2014)

Statista, (2014) http://www.statista.com/statistics/263492/electricity-prices-in-selected-countries/ (accessed March 14, 2014)

Tedaş, Türkiye Elektrik Dağıtım Anonim Şirketi, (2014), http://www.tedas.gov.tr/BilgiBankasi/Sayfalar/ElektrikTarifeleri.aspx (accessed March 04, 2014)

The World Bank, World Development Indicators, (2013) http://data.worldbank.org/data-catalog/world-development-indicators (accessed March 14, 2014)

TRNC Department of Finance, (2014a), TRNC Budget 2010, General Income – Expense Statement http://www.kktcbutce.net/i/mozka/hazine/raporlar/01201012.pdf (accessed March 13, 2014)

TRNC Department of Finance, (2014b), http://www.kktcbutce.net/apex/f?p=2001:300:2819147729938229::NO (accessed March 13, 2014)

TRNC Ministry of Foreign Affairs, (2014), http://mfa.gov.ct.tr/tr/kibris-meselesi/dogal-gaz/ (accessed March 16, 2014)

TRNC State Planning Organization, (2012), http://www.devplan.org/Frame-eng.html (accessed March 03, 2014)

UNCTAD, UNCTADSTAT, (2014), http://unctadstat.unctad.org/TableViewer/tableView.aspx?ReportId=88 (accessed March 17, 2014)