WORLD TRADE  
ORGANIZATION  WT/REG97/R/B/2 
G/L/730 14 February 2005 
 
(05-0595) 
Committee on Regional Trade Agreements Original:   English 
  
 
ASSOCIATION AGREEMENT BETWEEN THE EUROPEAN COMMUNITY 
AND CYPRUS 
 
 
 The following communication, dated 14 January 2005, is being circulated at the request 
of the Delegations of the European Communities. 
 
_______________ 
 
Biennial Report on the Operation of the Agreement (2001-2003)
 
 
Communication from the European Communities 
 
 
I. BACKGROUND INFORMATION ON THE AGREEMENT 
1. Membership And Dates Of Signature, Ratification And Entry Into Force. 
 The Association Agreement between the EC and Cyprus was signed in December 1972 
and entered into force in 1973 (Official Journal L 133, 21/05/1973 p. 0002 – 0086). As of 1 May 2004 it was superseded by the accession of the Republic of Cyprus to the EU. The Association Agreement is therefore no longer in force.  2. Type Of Agreement  
 The Association Agreement established a free trade area between the parties through 
progressive liberalisation of trade in goods.  
3. Scope 
 The scope of the agreement was largely unaltered in the reporting period, even though 
further liberalization was achieved in the area of fish.  
 
4. Trade Data 
 Bilateral trade totalled € 3.44 billion in 2003 and averaged € 3.16 billion over the period 
2001-2003. The EU-15 imports from Cyprus were € 701 million in 2003 whereas the imports 
into Cyprus from the EU-15 amounted to € 2.74 billion. Of total bilateral trade, industrial goods 
represented 89 percent in 2003 and also averaged 89 percent over 2001-2003. The share of trade in agricultural and processed agricultural products was 10 percent in 2003. Further statistical information is provided in the annex.   WT/REG97/R/B/2 
G/L/730 Page 2 
 
 
II. TRADE PROVISIONS 
1. Import Restrictions 
 An agreement to further liberalise trade in fish products was concluded by the Parties in 
2001. The parties agreed to decrease their tariffs on fish products by one third per year upon 
entry into force of the agreement (2002) while the EU fixed a temporary tariff quota for various 
categories of fish (sea bream, sea bass). Trade in fish products was thus fully liberalised two years after the entry into force of the agreement, i.e. on 1 January 2004.   
3. Rules Of Origin 
 The Association Agreement applied the pan-European preferential rules of origin even 
though Cyprus has been granted derogation from the rules of origin, allowing more extensive use of imported fabric in the production of certain textile products, since 1973 for men’s garments and since 1989 for women’s garments. A decision by the EC-Cyprus Association Council in March 2001 upheld Cyprus’ derogation and applied it until Cyprus’ accession to the 
EU.  
4. Standards 
 As part of its EU accession process, Cyprus gradually aligned to all EU standards, 
norms and regulations.   III. GENERAL PROVISIONS OF THE AGREEMENT 
5. Institutional framework 
 The following institutional structures were created during the reporting period: Sub-
committee on the macroeconomic situation in Cyprus (April 2001) and Joint Consultative Committee (July 2001).  
 
   WT/REG97/R/B/2
 G/L/730
 Page 3 
 
EU15-Cyprus Imports/Exports, 2001-2003        (million Euro) 
              05 November 2004  
EU15 trade 2001 - 2003 with Cyprus (million Euro) 
           
imports exports  bala nce  total trade  Cyprus 
2001 2002 2003 2001 2002 2003 2001 2002 2003 2001 2002 2003 
HS Section                     38,195        
Total 592 534 701   2,408 2,510 2,736   1,816 1,976 2,035   3,000 3,044 3,437 
of which:                  
01 Animals & animal products   16 19 19   33 35 37   17 15 18   49 54 56 
02 Vegetable products   70 83 73   35 29 30   -35 -54 -43   105 113 103 
03 Animal or vegetable fats   000   9 8  9   9 89   9 8 9  
04 Prepared foodstuffs   23 23 19   164 175 172   141 152 154   187 198 191 
05 Mineral products   23 33 33   127 82 108   104 49 75   150 115 141 
06 Chemical products   33 39 40   253 279 292   221 240 252   286 318 332 
07 Plastics & rubber   6 7 6   95 90 94   89 84 88   100 97 100 
08 Hides & skins   4 3 2   14 13 13   10 10 10   17 17 15 
09 Wood & wood products   1 2 2   35 39 40   34 37 38   36 40 42 
10 Wood pulp products   9 9 5   98 103 111   89 94 107   107 112 116 
11 Textiles & textile articles   36 31 20   193 196 208   156 165 187   229 227 228 
12 Footwear, headgear   2 1 1   38 39 34   36 38 33   40 40 35 
13 Articles of stone, plaster, cement, asbestos   2 1 1   75 83 84   74 82 83   77 84 85 
14 Pearls, (semi-)precious stones, metals   8 6 5   30 28 26   22 21 21   38 34 31 
15 Base metals & articles thereof   24 22 22   121 131 140   97 108 118   146 153 163 
16 Machinery & mechanical applicances   35 30 30   543 606 532   508 576 502   578 637 563 
17 Transportation equipment   255 178 372   305 388 608   50 210 236   560 566 980 
18 Instruments - measuring, musical   17 17 36   69 71 88   52 54 52   86 89 124 
19 Arms & ammunition   1 1 1   28 7 2   27 6 2   29 8 3 
20 Miscellaneous   10 21 7   109 100 101   100 80 94   119 121 108 
21 Works of art   13 1 1   28 3 1   15 2 1   42 3 2 
Other   5 6 5   5 4 5   0 -2 0   10 10 10 
Source : Eurostat COMEXT - 5 November 2004 (Statistical regime 1)           TRADE/F/1  José Álvarez  
  WT/REG97/R/B/2 
G/L/730 
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EU15-Cyprus: Imp/Exp 2003 - comparison with extra-EU15  (million Euro) 
                  
 EU15 trade 2003 with Cyprus  EU15 tr ade 2003 with Extra-EU15   Cyprus 
 imports exports balance  imports exports balance  market shares Cyprus / Total 
 M 
Euro % Total M 
Euro % Total M Euro  M Euro % Total M Eu ro % Total M Euro  imports exports Exp-Imp 
ratio 
HS Section      1011 Extra-EUR   05 November 2004 
Total  701 100.0% 2,736 100.0% 2,035   899,676 100.0% 853,002 100.0% -46,674   0.1% 0.3% 3.90 
of which:                  
01 Animals & animal products     19 2.7% 37 2.2% 18   16,046 1.8% 10,483 1.2% -5,563   0.1% 0.3% 1.93 
02 Vegetable products     73 10.4% 30 5.0% -43   25,276 2.8% 11,388 1.3% -13,888   0.3% 0.3% 0.41 
03 Animal or vegetable fats     0 0.0% 9 0.2% 9   2,427 0.3% 1,988 0.2% -439   0.0% 0.5% 1598.76 
04 Prepared foodstuffs     19 2.7% 172 2.2% 154   23,696 2.6% 26,396 3.1% 2,700   0.1% 0.7% 9.25 
05 Mineral products     33 4.7% 108 1.8% 75   141,932 15.8% 28,125 3.3% -113,807   0.0% 0.4% 3.27 
06 Chemical products     40 5.7% 292 16.8% 252   67,153 7.5% 124,587 14.6% 57,434   0.1% 0.2% 7.33 
07 Plastics & rubber     6 0.9% 94 5.3% 88   26,750 3.0% 37,629 4.4% 10,878   0.0% 0.2% 14.98 
08 Hides & skins     2 0.4% 13 0.1% 10   9,342 1.0% 8,767 1.0% -576   0.0% 0.1% 5.19 
09 Wood & wood products     2 0.3% 40 2.3% 38   13,694 1.5% 7,358 0.9% -6,336   0.0% 0.5% 18.34 
10 Wood pulp products     5 0.7% 111 3.7% 107   14,666 1.6% 24,961 2.9% 10,296   0.0% 0.4% 23.93 
11 Textiles & textile articles     20 2.9% 208 2.5% 187   65,714 7.3% 37,079 4.3% -28,635   0.0% 0.6% 10.16 
12 Footwear, headgear     1 0.1% 34 0.2% 33   11,539 1.3% 6,154 0.7% -5,386   0.0% 0.6% 53.40 
13 Articles of stone, plaster, cement, asbestos     1 0.1% 84 1.7% 83   7,946 0.9% 14,671 1.7% 6,725   0.0% 0.6% 82.06 
14 Pearls, (semi-)precious stones, metals     5 0.7% 26 0.3% 21   29,693 3.3% 21,893 2.6% -7,800   0.0% 0.1% 5.47 
15 Base metals & articles thereof     22 3.2% 140 7.0% 118   51,792 5.8% 54,252 6.4% 2,461   0.0% 0.3% 6.28 
16 Machinery & mechanical applicances     30 4.3% 532 35.2% 502   237,072 26.4% 266,465 31.2% 29,393   0.0% 0.2% 17.46 
17 Transportation equipment     372 53.1% 608 5.4% 236   79,715 8.9% 102,270 12.0% 22,555   0.5% 0.6% 1.64 
18 Instruments - measuring, musical     36 5.2% 88 4.3% 52   37,342 4.2% 41,430 4.9% 4,087   0.1% 0.2% 2.42 
19 Arms & ammunition     1 0.1% 2 0.1% 2   503 0.1% 891 0.1% 388   0.1% 0.3% 3.04 
20 Miscellaneous     7 1.0% 101 1.0% 94   29,532 3.3% 17,650 2.1% -11,882   0.0% 0.6% 13.74 
21 Works of art     1 0.1% 1 0.0% 1   2,100 0.2% 3,767 0.4% 1,667   0.0% 0.0% 1.89 
Other     5 0.7% 5 0.0% 0   5,744 0.6% 4,799 0.6% -945   0.1% 0.1% 1.01 
Source : Eurostat COMEXT - 5 November 2004 (Statistical regime 1)          TRADE/F/1  José Álvarez  
 
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