REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Thirteenth Annual Report 2018 on the implementation of Community assistance under Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community
Date: 2019-07-05
Institutions: European Commission, Secretariat-General
Subjects: Cyprus, EU aid, activity report, aid programme, civil society, development aid, economic development, financial aid, national unification, social development

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 5.7.2019 COM(2019) 322 final  REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Thirteenth Annual Report 2018 on the implementation of Community assistance under Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community  
 
 
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT 
AND THE COUNCIL 

Thirteenth Annual Report 2018 on the implementation of Community assistance under 
Council Regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of 
financial support for encouraging the economic development of the Turkish Cypriot 
community 

1. 

INTRODUCTION 
Council  Regulation  (EC)  No  389/20061  (the  "Aid  Regulation")  is  the  basis  for  the 
provision of assistance to the Turkish Cypriot community (TCc) and requires annual 
reporting  to  the  Council  and  the  European  Parliament.  This  report  covers  the  year 
2018. 

2. 

PROGRAMMING OF THE ASSISTANCE 

Between  2006  and  the  end  of  2018,  EUR  520  million  was  programmed  for 
operations under the Aid Regulation. The amount committed in October 2018 for the 
2018  annual  action  programme  was  EUR  34.5  million2.  The  Multiannual  Financial 
Framework  (MFF)  2014-20  provides  a  multi-annual  perspective  to  the  programme 
with a provision for stable, annual funding. The assistance programme is, however, 
temporary in nature, aiming to facilitate the reunification of Cyprus, and both the Aid 
Regulation and Council Regulation No 1311/2133 laying down the MFF, allow for a 
revision in case of reunification.  

3. 

IMPLEMENTATION MECHANISMS  

The programme is implemented in the areas of the Republic of Cyprus in which the 
Government of the Republic of Cyprus does not exercise effective control and where 
the application of the acquis is temporarily suspended pursuant to Protocol 10 of the 
through  direct 
Treaty  of  Accession.  Assistance 
management by the European Commission, but some projects are indirectly managed 
by  the  United  Nations  Development  Programme  (UNDP),  the  European  Bank  for 
Reconstruction and Development  (EBRD), the  British Council, or  Northern  Ireland 
Co-operation Overseas (NI-CO).  

implemented  primarily 

is 

The Commission operates in a unique political, legal and diplomatic context. Ad hoc 
arrangements  are  needed  to  implement  the  programme  while  respecting  the 
principles of sound financial management. In EU-funded aid programmes, in normal 
circumstances, agreements  with  a beneficiary  government  would establish the legal 
framework  for  development  assistance.  No  such  agreements  can  be  made  for  the 
assistance to the TCc. Management and mitigation of the inherent risk is part of the 
Commission's  responsibility  and  measures  adopted  include  intensive  monitoring  of 
contracts and provision of support to beneficiaries, revised payment conditions and a 
careful approach to the use of bank guarantees. The assistance includes a significant 
amount of grant support, requiring resource-intensive management.  

1 
2 
3  

OJ L65, 7.3.2006, p.5. 
Commission Decision C(2018) 6695.  
OJ L347, 2.12.2013, p.884. 

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To  ensure  successful  and  sustainable  implementation  in  this  environment,  the  TCc 
must fully engage in the preparation for the acquis roll-out following settlement.  

The Programme Team operates through the EU Programme Support Office (EUPSO) 
in  the  northern  part  of  Nicosia.  The  Representation  of  the  Commission  in  Cyprus 
also  hosts  meetings,  seminars  and  press  conferences  and  communicates  with  the 
Cypriot public throughout the island, including on the Aid Programme. In addition, 
the  EU  Infopoint,  funded  under  the  Aid  Programme,  carries  out  a  range  of 
communication  and  visibility  actions,  providing  information  about  EU  policies, 
priorities and actions in support of the TCc, and promoting European culture.  

4. 

IMPLEMENTATION DURING THE REPORTING PERIOD 

4.1. 

General overview 

The Commission continues to implement the Aid Regulation with the overall aim of 
supporting reunification. The Commission stands ready to adapt the programme as a 
result of any agreements reached in the settlement talks.  

Operations  in  2018  included  the  continuation  of  a  number  of  established  and 
successful  projects,  such  as  EU  scholarships  and  confidence  building  measures  in 
support  to  the  Committee  on  Missing  Persons  (CMP)  and  to  the  Technical 
Committee on Cultural Heritage (TCCH).  

Assistance  provided  to  key  economic  sectors  preparing  for  a  settlement  was 
reinforced through projects for the development of the private sector and rural areas 
as well as human resources development. Efforts towards tangible improvements in 
the area of animal diseases eradication and food safety continued. 

Considerable  gaps  in  the  capacity  of  the  beneficiaries  to  effectively  implement  the 
acquis,  following  a  comprehensive  settlement,  still  exist  and  the  approval  of  many 
legal  texts  remains  pending.  However,  the  TCc  has  a  firmer  understanding  of  the 
challenges linked with the implementation of legal texts aligned with EU standards. 

Grant  support  remains  an  essential  element  of  the  programme.  For  the  scholarship 
programme,  the  Commission  continued  to  make  recourse  to  outsourcing,  to  help 
ensure that grants reach the beneficiaries in a timely and efficient manner. 

In  addition,  since  2008,  a  Project  Management  Unit  (PMU)  set  up  through  a 
technical  assistance  service  contract  has  been  providing  services  to  support  the 
implementation of grant schemes. This PMU, renamed to Grant Support Team (GST) 
in  2018,  continues  to  offer  valuable  help  to  the  Commission  in  terms  of  increased 
efficiency  and  assurance  in  the  operational  management,  implementation,  and 
monitoring of grant schemes.  

One  continuing  issue  has  been  the  construction  of  the  Famagusta  sewage  network, 
the  contract  for  which  was  terminated  in  December  2013  by  the  Commission.  The 
dispute with the former contractor has been brought to arbitration as all options for 
an  amical  settlement  had  been  exhausted.  In  parallel,  the  related  remedial  works 
tender was launched in 2018. 

At the end of the year, 206 contracts were overall running under the Programme.  

4.2. 

Progress by objectives 

The  overall  objective  of  the  Aid  Programme  is  to  facilitate  the  reunification  of 
Cyprus  by  encouraging  the  economic  development  of  the  TCc,  with  particular 

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emphasis on the economic integration of the island, on improving contacts between 
the two communities and with the EU, and on preparation for the acquis.  

The  activities  undertaken  in  2018  with  respect  to  each  of  the  objectives  of  the  Aid 
Regulation were:  

4.2.1.  Objective 1: Developing and restructuring of infrastructure 

A  contribution  agreement  with  the  UNDP  was  signed  in  December  2018  for  the 
implementation  of  the  new  Local  Infrastructure  Facility  (LIF).  The  facility  is 
designed as a transparent mechanism streamlining priority infrastructure investments 
under  the  Aid  Programme.  The  contribution  agreement  is  for  a  value  of  EUR  17.7 
million, over a three-year period. 

The  facility  aims  to  provide  support  for  identifying,  screening,  developing, 
procuring,  and  physically  implementing  relevant  local  infrastructure  investments. 
Projects  will  be  selected  through  regular  calls  for  expression  of  interests  to  local 
beneficiaries.  The  following  indicative  shortlist  includes  projects  ready  for 
implementation starting early 2019: 

  Pedieos/Kanlıdere River Rehabilitation Project;  
  Decommissioning of old Nicosia wastewater treatment plant (WWTP); 
  Extension of Morphou/Güzelyurt and Famagusta WWTPs; 
  Establishment of green waste composting facility in Nicosia. 

An  EU-funded  detailed  feasibility  study  for  the  rehabilitation  of  the  Pedieos/ 
Kanlıdere River was completed in December 2018. The scope of the study includes 
the  construction  of  a  linear  park  along  an  approximate  5  km  length  of  the  river 
consisting  of  flood  protection  measures,  cycling  and  walking  paths,  recreational 
areas and environmental educational facilities. By extending north and south of the 
Green  Line,  this  bi-communal  project  aims  to  bring  the  Cypriot  communities 
together through recreational activities.  

In the water sector, a EUR 10.9 million works contract was signed in December 2018 
for  the  construction  of  the  Nicosia  branch  of  the  northern  Nicosia  Trunk  Sewer 
(NNTS). The Commission also signed the related EUR 0.7 million service contract 
for supervision of the works. The works are due to commence in the second quarter 
of  2019  for  a  period  of  33  months.  The  project  will  involve  construction  of 
approximately  13  km  of  sewers  and  4  pumping  stations  to  convey  wastewaters  of 
Nicosia  to  the  bi-communal  Mia  Milia/Haspolat  WWTP  in  Nicosia,  itself  an  EU-
funded  project  completed  in  2013.  Since  the  existing  trunk  sewer,  which  covers 
central,  northern  and  southern  Nicosia,  is  now  running  at  full  capacity,  the  NNTS 
will  facilitate  the  connection  of  more  urban  areas  to  the  WWTP  in  line  with  the 
Urban Waste Water Treatment Directive. 

In  December  2018,  a  EUR  2.14  million  works  contract  and  a  EUR  0.5  million 
service contract were signed for the EU-funded project concerning the construction 
of  an  irrigation  system  for  the  reuse  of  Morphou/Güzelyurt  WWTP  treated 
wastewater. The works commenced in February 2019 for a period of 29 months. The 
project will utilise the treated wastewater from the WWTP by construction of a water 
reservoir  and  an  irrigation  water  distribution  system.  This  will  facilitate  the  safe 
reuse of 500 million litres per  year of high quality water to irrigate the local  crops. 
Through this project  the Commission  aims to  raise awareness  about  the  benefits  of 
reusing treated wastewater for agricultural irrigation in the northern part of Cyprus. 

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The feasibility study and conceptual design of the distribution system for the use of 
treated  wastewaters  from  the  bi-communal  Mia  Milia/Haspolat  WWTP  in  Nicosia 
are  completed.  The  final  detailed  design  and  associated  tender  dossier  for  this 
important bi-communal project are in the final stages of approval and expected to be 
completed in the second quarter of 2019. 

The  works  tender  for  the  necessary  remedial  works  to  the  Famagusta  sewage 
networks  was  launched  in  2018.  The  works  contract  and  the  related  supervision 
service contract were signed in April 2019. 

Preparatory activities were initiated for the first phase of the decommissioning of the 
old Nicosia WWTP. The project will provide pre-treatment facilities for wastewater 
streams originating from the food industry and reduce the surface of the lagoons used 
for further treatment of these streams. 

Assistance  in  the  solid  waste  sector  continued  through  different  actions.  Two 
contracts – "Extension to the Koutsoventis/Güngör landfill" and "Landfill Degassing 
Plant"  –  signed  in  December  2017  are  in  the  final  stages  of  completion.  The  first 
section  of  the  landfill  extension  works  was  given  over  for  use  to  the  TCc  in 
September 2018. 

is  supporting 

With  the  assistance  of  Commission  experts,  a  legal  text  on  Packaging  Waste  was 
finalised  in  line  with  EU  standards  and  best  practice  in  December  2018.  In  a 
continued  drive  towards  the  sustainable  management  of  packaging  waste,  the  Aid 
the  development  and  establishment  of  Producer 
Programme 
Responsibility  Organisations  (PRO's).  To  this  end,  discussions  with  "Green  Dot 
Cyprus"  have  been  initiated.  Furthermore,  the  Solid  Waste  Management  Database 
completed  in  2017  and  based  on  the  European  Solid  Waste  Catalogue  has  been 
expanded in 2018 to incorporate waste waters. Due to the successful "uptake" of the 
database  by  the  beneficiary,  current  plans  for  2019  foresee  its  further  expansion  to 
incorporate  packaging  waste  tracking  and  management  of  operational  licencing  for 
PRO's. 

The  installation,  training  and  commissioning  of  a  new  sterilisation  facility  for 
treatment  of  hazardous  medical  waste  was  finalised  with  the  signing  of  the 
Provisional  Acceptance  Certificate  in  August  2018.  This  project  was  further 
bolstered 
the  design  and 
implementation  of  a  sustainable  Medical  Waste  Management  System.  Follow-up 
assistance  continues  to  the  final  beneficiary  into  2019  to  help  ensure  sustainable 
operation. 

technical  capacity  project 

through  a 

involving 

Finally,  solid  waste  management  was  also  addressed  in  grant  schemes  supporting 
civil  society  and  local  communities.  The  awarded  grants  involve  the  setting-up  of 
solid  waste  transfer  stations  and  green  waste  management  according  to  a  coherent 
EU  developed  Integrated  Solid  Waste  Management  Plan.  The  projects  are 
progressing and expected to be finalised by December 2020. 

The  tender  dossier  for  the  supply  of  laboratory  equipment  and  instruments  for  air, 
fuel and water analysis was launched in December 2018. The contract is expected to 
be  signed  in  the  third  quarter  of  2019.  The  equipment  supplied  under  this  contract 
will enable analysis and quality monitoring in order to achieve compliance with EU 
Directives. 

Also, a project for "Supply of Air Quality Monitoring Equipment" has been approved 
within  the  2018  Aid  Programme  budget  and  technical  specifications  have  been 

4 

 
 
drafted  with  tendering  expected  in  mid-2019.  The  equipment  will  improve  the 
existing  air  quality  monitoring  network  established  in  2009-2010  through  EU 
funding. 

A framework contract was signed in November 2018 for technical assistance for the 
implementation  of  an  Energy  Efficiency  Programme  in  schools.  The  contract  will 
provide an assessment of the energy efficiency situation in 10 pilot schools resulting 
in a feasibility study detailing potential measures to increase the energy efficiency in 
the  existing  buildings.  The  contract  also  aims  to  increase  awareness  on  energy 
efficiency in the schools. 

Finally, a project for the "Supply of Emergency Response Equipment for Prevention 
of  Water  Pollution"  approved  within  the  2018  Aid  Programme  budget  is  currently 
under preparation with the tender documentation being developed. It is expected this 
tender could be launched by mid-2019. 

4.2.2.  Objective 2: Promoting social and economic development 

The  "Technical  Assistance  to  the  Private  Sector  (TAPS)"  project,  launched  in 
November 2015, was  finalised in  September 2018.  In order to  ensure sustainability 
of  the  action,  TAPS  work  on  innovation  and  entrepreneurship  will  be  followed  up 
through a Contribution Agreement with Northern Ireland Cooperation Overseas (NI-
CO)  signed  in  December  2018.  The  project  "Innovative  Entrepreneurship  and 
Dialogue" with a duration of three years has an overall budget of EUR 3 million. The 
action is a response to the need for more shared spaces in Cyprus to allow for greater 
interaction,  exchange  of  experience  and  opinions,  effective  partnerships  and 
research.  The  action  aims  to  open  up  physical  and  virtual  spaces  for  innovators, 
entrepreneurs and researchers, community dialogue and knowledge sharing.  

A  call  for  proposals  "Competitive  Enterprises,  Clusters  and  Business  Support 
Organisations"  with  a  budget  of  EUR  5  million  was  launched  in  April  2018.  The 
individual grant contracts are expected to be signed in the second quarter of 2019. A 
framework  contract  to  develop  technical  specifications  for  an  IT  system  to  support 
local bodies in the implementation of the scheme for market surveillance was signed 
in September 2018.  

In addition, the Delegation Agreement with the EBRD which aims to address the two 
fundamental  elements  needed  to  strengthen  local  SMEs'  competitive  position  – 
access  to  finance  and  business  advice  –  was  continued.  By  December  2018,  53 
consultancy projects were approved and in implementation or completion.   

In  the  field  of  rural  development,  the  Commission  signed  a  new  contract  in 
December 2018 to provide technical assistance through Farm Advisory Services. The 
contract will run for 30 months. The Commission also launched a call for proposals 
(Rural Development IV) with a budget of EUR 5 million (half for animal husbandry 
and half for crops). The individual contracts are expected to be signed in the fourth 
quarter of 2019. 

In  2018,  the  EU  technical  assistance  further  improved  capacities  of  veterinary 
specialists  to  prevent,  control  and  eradicate  animal  diseases.  As  a  result, veterinary 
specialist  staff  has  been  enabled  to  design  and  implement  disease  surveillance, 
control  and  eradication  programmes,  in  line  with  EU  requirements.  Capacities  for 
early detection and elimination of emerging animal diseases (such as foot and mouth 
disease,  lumpy  skin  disease,  peste  des  petites  ruminants  and  sheep  and  goat  pox) 

5 

 
 
have also been strengthened. Crisis preparedness plans and procedures to contribute 
to fast and effective elimination of animal disease outbreaks were drafted. 

Continued sampling and testing of animals (fully EU funded) resulted in around 40% 
of sheep, goat and cattle holdings being declared free from animal diseases such as 
brucellosis, bovine tuberculosis and leucosis, in accordance with EU requirements.  

Owing to the TAIEX instrument and technical assistance, legal texts and engagement 
procedures  for  involvement  of  the  private  sector  (i.e.  private  veterinarians)  in  the 
implementation  of  animal  diseases  programmes  and  other  public  veterinary  tasks 
(such  as  controls)  have  been  finalised.  This  should  contribute  to  increased  local 
capacities  for 
implementation  of  EU  aligned  veterinary  programmes  and 
requirements.  In  addition,  a  system  for  regular  exchange  of  information  and 
documentation  with  stakeholders  on  veterinary  programmes/activities  has  been 
established. The objective is to contribute to better mutual understanding and faster 
improvement or resolution of issues between veterinary services and stakeholders. 

Moreover, in 2018 the Commission signed a new EUR 2.4 million works contract to 
support  the  construction  of  an  animal  waste  disposal  system  in  the  TCc.  The 
objective  is  to  improve  public  health,  animal  health  and  environment  by 
implementing  a  system  for  the  collection,  transport  and  disposal  of  materials  of 
animal  origin  that  people  do  not  consume  (animal  by-products).  The  contract  will 
finance the building  of  a central  location for collection, storage and incineration of 
animal  by-products  and  6  satellite  collection  and  transfer  centres  distributed  across 
the northern part of Cyprus.  

In the education sector, 15 grant projects that were awarded in 2016 under the EUR 
1.5 million grant scheme for "Innovation and Change in Education VI" continued to 
be implemented in 2018; 10 of them were accomplished towards the end of the year. 
The  projects  focus  on  improving  teaching/learning  capacities  in  the  schools  with 
introducing  extra-curricular  and  soft  skills  programmes  as  well  as  establishing 
science labs and a green-house for organic farming. On the other hand, the life-long 
learning projects  help  improving professional  capacities of  architects  and engineers 
and  introduce  entrepreneurship  and  life-long  training  courses  to  improve  the 
employability of youth.  

During 2018, 10 additional grant projects were awarded under the EUR 1.5 million 
grant scheme for "Innovation and Change in Education VII". Under this new scheme, 
the school projects focus on enhancing social inclusion and mobility of children with 
special needs, improving English and Greek language learning practices with the aid 
of technology, and introducing the extra-curricular activities to improve life skills of 
primary  school  students.  The  lifelong  learning  projects  help  improving  the 
entrepreneurial  skills  of  youth  and  women,  enhancing  social  entrepreneurship 
practices  in  the  TCc,  and  developing  lifelong  learning  programmes  to  improve 
employability  of  youth  and  people  with  disabilities.  The  grant  projects  are  to  be 
finalised by 2021. 

The  second  technical  assistance  project  for  "Vocational  Education,  Training  and 
Labour  Market  (VETLAM  II)",  launched  in  November  2015,  came  to  an  end  in 
November  2018.  The  project  helped  in  revising  and  developing  41  occupational 
standards  for  vocational  skills.  In  addition,  it  contributed  to  the  development  of 
occupational classification following the ILO standards ISCO-08, vocational schools 
strategy, and active labour market measures for three selected disadvantaged groups 
(youth,  women  and  people  with  disabilities).  The  assessment  procedures  for  work-

6 

 
 
based  learning  and  apprenticeship  programmes  as  well  as  a  local  pool  of  assessors 
were also developed.  

In further supporting the education sector in line with the priorities of EU Strategic 
Framework  –  Education  and  Training  2020,  a  framework  contract  was  signed.  The 
technical assistance aimed to carry out an assessment of the current situation in the 
education  sector  and  its  linkage  to  the  economy,  facilitate  the  preparation  of  a 
development  plan,  and  help  identify  the  needs  that  could  be  addressed  with  future 
EU support in the area of education. The support was concluded in December 2018 
and its deliverables will be used as an input for the preparation of future support to 
the education sector. 

Building  on  the  results  of  previous  analytical  work,  the  second  phase  of  the 
economic monitoring programme conducted by the World Bank provided additional 
in-depth  analysis  and  technical  assistance  in  important  areas.  The  programme 
focused  on  fiscal  analysis,  financially  sustainable  public  administration  bodies, 
economic,  trade-related  effects  of  reunification,  private-sector  development  and 
social  inclusion,  as  well  as  macroeconomic  monitoring.  In  line  with  the  political 
priorities  in  the  framework  of  the  Aid  Programme,  an  additional  envelope  of  EUR 
4.8  million  was  contracted  in  2017  for  the  continuation  of  the  engagement  of  the 
World Bank to build on the analytical and advisory work done so far and to continue 
providing  advice  and  targeted  support  to  the  TCc  until  December  2020.  The 
programme  continued its activities in 2018, with  targeted support for private sector 
development, agriculture sector, social inclusion and local community bodies. 

4.2.3.  Objective 3: Fostering reconciliation, confidence building measures, and support to 

civil society 

The  Committee  on  Missing  Persons  (CMP),  supported  by  the  Aid  Programme 
through  an  indirect  management  arrangement  with  UNDP,  continued  its  field  and 
laboratory work. By the end of 2018, out of the 2 002 total missing persons, the CMP 
had  exhumed  1 202  sets  of  remains;  927  of  them  were  genetically  identified  and 
returned to their families. 

In December 2018, the contribution agreement with UNDP was extended to provide 
funding  for the  operations  of the CMP for the  year 2019,  for  an amount of EUR 3 
million.  Overall,  in  the  period  2006-2019  the  EU  contributed  with  a  total  of  EUR 
25.5 million which amounts to 75% of the overall funding provided to the CMP in 13 
years. 

With the passing of time, it is increasingly difficult to obtain precise information to 
determine the location of the burial sites. This is a key challenge to be addressed now 
by renewed efforts in researching civil and military archives in Cyprus and abroad, 
as  well  as  with  a  stronger  use  of  IT  tools  in  order  to  facilitate  the  investigation, 
excavation and exhumation phases.  

The additional top-up of EUR 0.4 million to the usual yearly funding is financed by 
the 2017 Aid Programme budget upon a specific request from the CMP. It covers the 
increased  costs  of  DNA  testing  and  the  increased  costs  of  compensation  and 
reparation  of  road  and  private  properties  affected  by  excavations.  In  addition,  the 
top-up also finances the feasibility study of the Dikomo/Dikmen landfill.  

At  the  end  of  2017,  a  two-year  investigation  resulted  in  information  about  the 
relocation  of  human  remains  from  Askeia  to  the  dumping  site  at  Dikomo/Dikmen 
allegedly between 1995 and 1996. Not aware of this information, the EU – between 

7 

 
 
2009  and  2012  –  funded  a  project  to  rehabilitate  the  landfill.  In  January  2018,  the 
Commission  shared  with  the  CMP  the  technical  specifications  and  the  drawings  of 
the works carried out under the EU project. In February 2018, the CMP requested to 
fund a feasibility study in order to assess the opportunity to excavate in the landfill 
with the appropriate safety measure to minimise the sanitary risks of an excavation as 
well  as  to  estimate  the  costs  of  such  an  excavation  and  the  subsequent  potential 
rehabilitation of the site. The Commission replied positively to this request and the 
study is currently ongoing. 

Cultural  Heritage  protection  through  the  bi-communal  Technical  Committee  on 
Cultural  Heritage  (TCCH)  remained  a  key  component  of  the  reconciliation  and 
confidence  building  actions  supported  under  the  Aid  Programme.  Overall,  the 
Cultural Heritage programme has received EUR 14.7 million of EU funds which are 
being used to  improve the protection of 75 cultural  heritage sites across the island. 
These  include  58  completed  work  projects,  9  completed  design  projects,  and  8 
ongoing  projects.  During  2018,  the  main  achievements  were  the  completion  of  the 
conservation works for the Minaret of Camii-Kebir and the Hamam in Paphos, Tuzla 
mosque  in  Larnaca  and  Agia  Triada  archaeological  site,  and  Agios  Philon 
conservation  of  the  archaeological  site  in  Karpasia/Karpaz.  In  Famagusta,  the  St. 
Mary of the Armenians and St. Mary of the Carmel were renovated, together with the 
Ravelin/Land gate and St. Anne church. Steps are being taken to develop the skills of 
care-takers in order to ensure adequate maintenance and caretaking of restored sites 
by the beneficiary communities. 

In  response  to  an  initiative  of  the  two  Cypriot  leaders  for  new  confidence  building 
measures, the Commission acted swiftly in 2015 to reallocate the necessary resources 
for  the  opening  of  the  new  crossing  points  at  Deryneia  and  Lefka-Apliki.  The 
crossing points opened on 2 November 2018. 

Support for civil society continued in 2018. Civic Space, the technical assistance for 
civil  society  organisations  (CSOs)  continued  to build  CSOs'  capacities,  promote  an 
enabling environment for the development of civil society, and stimulate networking 
and  joint  actions  with  Greek  Cypriot  and  other  EU  CSOs.  Since  2015,  through  its 
"Grow Civic" mechanism, Civic Space has supported 49 active citizenship initiatives 
(8  of  which  in  2018)  in  fields  such  as  peace  and  reconciliation,  youth,  education, 
health, art, human rights or environment. The Civil Society Forum, a platform where 
CSOs  can  express  their  expectations  and  priorities,  was  convened  every  three 
months. It acted as a catalyst for advocacy and promoted active citizenship.  

A full month of CSO actions under the name of "Open Door Festival" took place for 
the  third  time  in  September-October  2018,  with  the  aim  to  increase  awareness  and 
visibility  of  CSOs'  activities,  promote  volunteerism  among  people  of  all  ages,  and 
facilitate  networking  between  Nicosia-based  CSOs  and  those  in  other  regions. 
During  the  Festival,  more  than  60  associations,  foundations,  platforms,  initiatives 
and activists, including 10 bi-communal organisations, organised over 120 activities 
to meet the public and network with other CSOs. Bi-communal exchange visits were 
organised between Limassol and Famagusta CSOs with great interest on both parts. 

A study visit on anti-trafficking was organised in Brussels and Amsterdam in August 
2018  with  the  participation  of  one  member  from  eight  different  CSOs.  The  study 
visit  aimed  at  increasing  the  knowledge  and  experience  about  anti-trafficking  and 
provided the participants with EU-level networking opportunities. 

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The  pending  18  contracts  awarded  under  the  "Civil  Society  in  Action  IV  and  V" 
grant schemes were completed in 2018, while 8 new contracts were signed under the 
"Civil  Society in Action VI".  They are funding  a variety  of actions in  the fields  of 
environment, human rights, arts and sports to reinforce the CSOs' capacities as well 
as encourage citizens' engagement and cross-community exchanges.  

A  new  call  for  proposals  "Together  Against  Trafficking  in  Human  Beings"  was 
launched  in  June  2018  with  a  view  to  encourage  an  effective  and  coordinated 
response to all forms of trafficking in Human beings, prevent human trafficking and 
improve victims' access to rights. 

4.2.4.  Objective 4: Bringing the TCc closer to the EU 

The  management  of  "EU  scholarships  programme"  was  delegated  to  the  British 
Council  from  the  academic  year  2014-15.  The  budget  available  under  the  2018/19 
call  allowed  funding  for  171  scholarships  for  the  2018/2019  academic  year.  These 
scholarships support students during the first year of undergraduate studies, graduate 
students in their masters or doctoral programmes, and researchers and professionals 
in further developing their language and professional skills across EU Member States 
through  language  courses  or  internship  programmes.  The  Scholarship  Programme 
has ensured access to scholarships to more than 1 400 Turkish Cypriot students and 
professionals since 2007.  

Continuity  of  this  scheme  is  considered  vital  and  increased  efforts  will  be  put  on 
targeting the needs and gaps within the TCc. As part of the activities to manage the 
Scholarship  Programme,  the  British  Council  organises  every  year  the  "Study  in 
Europe" day to  provide  information  to  students about  study possibilities in  the EU. 
An online alumni network is being developed in the last years in order to enhance the 
contacts  and  professional  relations  between  the  Scholarship  alumni.  The  British 
Council is continuously monitoring medium-term impact, for example the return rate 
of students to Cyprus and success in finding employment.  

The high demand for information on the EU in the TCc continued in 2018. The EU 
Infopoint,  which  is  managed  together  with  the  Representation  of  the  European 
Commission in Cyprus, started functioning in early 2015 and is financed with a total 
budget of EUR 3 million  for  a 60-month period (with extension  of the contract). It 
generated a high level of visibility for the EU, its policies and the Aid Programme. 
Until now, the EU Infopoint has covered more than 25 EU-related themes, including 
environment (water, energy, recycling, biodiversity), organic agriculture, health and 
safety  at  work,  food  safety,  animal  welfare,  and  animal  health.  It  has  also  covered 
topics  such  as  human  rights,  rights  of  people  with  disabilities,  children’s  rights, 
gender equality, LGBTQ rights, and consumers' rights.  

In  2018,  the  EU  Infopoint  organised  50  events  (34  in  Nicosia  and  16  outside  of 
Nicosia),  including  Europe  Day,  European  Week  against  Racism,  European  Youth 
Week  &  International  Youth  Day,  European  Night  of  Researchers,  EU  Anti-
Trafficking  Day,  Mobility  Week  and  Traffic  Safety,  and  European  SMEs  Week. 
These  events  attracted  over  5 144  participants,  showing  increased  interest  from  the 
community (4 849 participants at 2017 events and 4 382 participants at 2016 events). 
The number of events with schools was increased to ensure wider outreach. 

During  2018,  5 151  information  products  and  12  newsletters  were  distributed  (in 
total since the opening of the Infopoint, 18 835 and 42 respectively). Also, 493 news 
articles and 45 TV spots  appeared on the local  media during 2018 (1 759 and 160, 

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respectively, since inception of the project). Traffic on the Facebook page "Abbilgi" 
confirmed  the  popularity  of  the  activities  (2 982  new  "likes"  in  2018,  bringing  the 
total number of "likes" since its opening to 13 998). By end 2018, the Facebook page 
had a reach of 291 829 posts. 

The EU  Infopoint supported also  the promotion  of all calls for proposals and other 
Aid Programme funded projects and events via Facebook posts/reminders, front-shop 
poster  displays,  hosting  of  events  and  project  launches  at  its  public  space.  It 
established  strategic  partnerships  with  other  EU-funded  projects  and  technical 
assistance projects as well as with relevant departments and CSOs. 

4.2.5.  Objectives  5-6:  Preparing  the  Turkish  Cypriot  community  to  introduce  and 

implement the acquis  

The  Commission's  Technical  Assistance  and  Information  Exchange  (TAIEX) 
instrument  is  used to  implement  objectives 5 and 6 of the Aid Regulation  and thus 
helps prepare the TCc for implementation of the acquis in view of the withdrawal of 
its suspension upon the entry into force of a comprehensive settlement of the Cyprus 
problem.  

Assistance continued in 2018 in 17 main areas, or "sectors", of the  acquis. In total, 
the number of events organised in 2018 was 207. TAIEX actions included inter alia 
expert  missions,  workshops,  and  study  visits.  TCc  stakeholders  demonstrated  a 
significantly  heightened  awareness  of  acquis  requirements  in  the  majority  of  the 
active TAIEX sectors.  

Support  for  trade  across  the  Green  Line  (Regulation  866/2004)  continued.  The 
independent experts were involved in 2018 in carrying out the regular phytosanitary 
inspections  of  potatoes  and  citrus  products,  taking  honey  samples  for  analysis,  and 
producing  an  updated  list  of  vessels  whose  catch  can  be  traded  across  the  Green 
Line. 

4.3. 

Financial execution (contracts and payments) 

4.3.1.  Contracting 

The Commission signed legal commitments in 2018 amounting to EUR 56.2 million, 
which  means  that  the  substantial  amount  of  accumulated  funds  that  remained 
uncommitted under the Aid Programme has been brought under control.  

4.3.2.  Payments 

Payments in 2018 were EUR 26.3 million (EUR 17.2 million in 2017).  

4.4.  Monitoring 

The Commission has direct responsibility for implementation of most projects (direct 
management).  The  level  of  monitoring  by  Commission  staff  is  very  high,  with 
constant  contacts  with  contractors,  "spot-check"  visits  as  well  as  site  meetings  and 
steering committees meetings. The PMU/GST continued to support the Commission 
with  the  monitoring  implementation  of  grant  contracts/projects  awarded  to  local 
communities  for  their  development,  to  SMEs  and  rural  enterprises,  to  CSOs,  to 
schools  and  vocational  education  and  training  organisations,  while  also  supporting 
grant beneficiaries in the application of EU rules for grant contract implementation, 
including for secondary procurement.  

In  addition,  the  Commission  implements  a  number  of  contracts  under  indirect 
management  mode.  The  implementing  entities  such  as  the  UNDP,  the  EBRD,  the 

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British  Council,  and  Northern  Ireland  Co-operation  Overseas  (NI-CO)  are  pillar 
assessed and report to the Commission in accordance with the respective Framework 
Agreements.  The  Commission  is  closely  involved  in  the  day-to-day  monitoring  of 
these actions.  

For  TAIEX,  regular  monitoring  includes  Project  Steering  Group  meetings  to  take 
stock,  evaluate  progress  and  continue  planning.  TAIEX  logistics  are  monitored 
through the on-line TAIEX Management System. 

4.5. 

Audit and controls 

In  2017,  the  Internal  Audit  Service  (IAS)  carried  out  an  audit  on  the  financial 
management  of  the  Structural  Reform  Support  Service  (SRSS),  including  the 
financial  management  of  the  Aid  Programme.  The  objective  of  the  audit 
encompassed,  amongst  others,  the  adequacy  of  the  design  and  the  effective 
implementation of the internal control system for financial management (legality and 
regularity  and  efficiency  of  the  financial  workflow).  The  IAS  identified  some 
weaknesses  in  the  internal  control  environment  put  in  place  in  the  procurement 
procedures, which are being addressed through implementation of an action plan in 
response to IAS recommendations.   

The following has been implemented as corrective measures: (i) prior to launching a 
procurement procedure under the Aid Programme, a need analysis is carried out on 
the basis of a new template designed for this purpose and the choice of procurement 
procedure  is  made  on  this  basis;  (ii)  in  parallel,  proper  follow-up  tables  have  been 
developed  to  monitor  the  procurement  pipelines,  from  the  launch  of  the  tendering 
procedure until the contract signature; and (iii) guidance notes have also been issued 
to clarify the prevailing rules. 

4.6. 

Evaluation 

Significant improvement in statistics within the TCc will be necessary to accompany 
the future acquis roll-out.  

In November 2018, the SRSS concluded a contract for the implementation of the first 
Results Oriented Monitoring (ROM) exercise aiming at reviewing a minimum of 16 
actions  in  terms  of  relevance,  efficiency,  effectiveness  and  sustainability.  It  will 
assist SRSS with respect to the monitoring of and reporting on EU funded projects 
under  the  Aid  Programme.  The  ROM  reviews  will  focus  on  service  contracts  and 
grant  schemes  and  will  cover  both  ongoing  and  recently  closed  contracts.  The 
implementation of the ROM contract will continue for a period of two years.   

4.7. 

Information, Publicity and Visibility 

Overall,  there  were  330  visibility  and  communication  actions  in  2018,  a  large 
number  of  them  organised  in  cooperation  with  the  Representation  of  the  European 
Commission in Cyprus. Some of the highlights in 2018 were: presentations on "State 
of  the  Union  and  2018  priorities",  Open  Door  Festival,  sharing  information  on  the 
work of the CSOs in various cities, Food Safety workshops on how the EU support 
strengthens food safety, and visits to the EU-funded WWTP in Morphou/Güzelyurt 
by  highs  school  students.  Europe  Day  was  celebrated  with  1  large-scale  outdoor 
event in Nicosia and 2 outdoor classical music concerts by the bi-communal chamber 
orchestra in Lefka/Lefke and Templos/Zeytinlik, with more than 500 participants. 

Many  public  events  on  the  EU  Scholarships  for  the  TCc,  including  a  student  and 
alumni  networking  event  in  Nicosia,  ensured  extensive  outreach.  Completion 

11 

 
 
ceremonies  of  various  Cultural  Heritage  projects,  including  St.  Mary  of  the 
Armenians and St. Mary of Carmel Churches and Ravelin Land Gate, were held. The 
event  at  Koutsoventis/Güngör  announcing  the  start  of  operation  of  the  newly 
completed solid waste storage facility (phase 2) ensured extensive outreach about EU 
support in the TCc with regard to solid waste management. EU support in the area of 
Traffic Safety and Health and Safety at Work was also communicated during various 
trainings at schools. 

Two major publications, namely  "2008-2018: 10 Years Working Together For Our 
Common Heritage – The Technical Committee on Cultural Heritage in Cyprus", and 
the  "Aid  Programme  for  the  Turkish  Cypriot  community  Selected  Stories",  were 
published.   

4.8. 

Consultations with the Government of the Republic of Cyprus 

Meetings  were  held  with  representatives  of  the  Government  of  the  Republic  of 
Cyprus,  in  particular  when  senior  Commission  officials  visited  the  island.  The 
Commission  continues  to  rely  on  the  Government's  cooperation  for  verification  of 
property  rights,  and  also  meets  regularly  with  the  Permanent  Representation  in 
Brussels. 

5. 

CONCLUSIONS 

The  Commission  continues  to  deliver  assistance  under  the  Aid  Regulation  to 
facilitate  the  reunification  of  Cyprus  by  encouraging  the  economic  development  of 
the TCc, through work under its six objectives. During 2018, assistance continued to 
focus on areas that present particular problems with future acquis compliance.  

In view of the capacity constraints, limited human and financial resources and gaps 
in  readiness  for  the  future  acquis  roll-out,  the  sustainability  of  projects  must  be 
carefully considered. The track record of past assistance and the maturity of projects 
will  be  continuously  reflected  in  future  programming  exercises.  Efforts  will  keep 
focusing on bringing more impact in priority areas through fewer but larger actions. 

The  Commission  stands  ready  to  deploy  resources,  including  under  the  Aid 
Programme, to support settlement negotiations under UN auspices as needed. 

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