North Cyprus Geopolitics: What You Need To Know

Have you heard of the Turkish Republic of Northern Cyprus (TRNC)? Located in the Eastern Mediterranean, it is better known as Northern Cyprus or North Cyprus. This country is known for its stunning beauty, rich history, growing tourism, bustling casinos, and exciting real estate market. 

North Cyprus is intriguing for expat investors in many ways, and most of the opportunities are flying under the radar for many. I visited to explore the opportunities on the site with our partner here in North Cyprus.

North Cyprus is a magnificent synthesis of East and West. The Republic of Cyprus is a member of the European Union, but North Cyprus defends its independence and has its own government. Ethnic Turks make up the majority of the population of North Cyprus, but the island is truly cosmopolitan. The majority of the population is Muslim, but North Cyprus is a secular state, and social life operates entirely through secular practices.     

The social life on the island is also vibrant, safe, and enjoyable. The sense of community is quite established here, which makes you feel comfortable enjoying all the opportunities the island has to offer. The bustling streets of North Cyprus come alive with cheerful conversations at night, and foodies will love the variety of local cousins, a mixture of Mediterranean, Turkish, and Greek. Students from 70 nations contribute to the global culture, as do Europeans who enjoy the Mediterranean vibe.

There is much more to the beauty of North Cyprus than what I have described, but I did not come here for a holiday. What interests me is the investment opportunities in North Cyprus, especially the real estate sector, which has risen in recent years. Would you be interested in Mediterranean houses with much more affordable prices than the rest of the Mediterranean? 

Let's dive into North Cyprus and discover the potential of this country. First, let me explain the political situation in North Cyprus.

It became clear to me, after speaking with many local residents, that those living in North Cyprus strongly support their independence and hope for international recognition of their political authority

TWO STATES IN ONE ISLAND

Despite its attractiveness, North Cyprus is not visible on political maps. Cyprus is divided into two separate entities. The first is the well-known Republic of Cyprus, which is part of the European Union. The second is the Turkish Republic of North Cyprus, which occupies the island's northern half. However, North Cyprus is only recognized by Turkey, leaving the Republic of Cyprus as the internationally recognized state on the island.

The story started In 1571 when the Ottoman Empire took Cyprus from the Venetians. Greeks and Turks lived in harmony on the island for a long time. But in 1878, the British took over Cyprus, and in 1925, they established it as a colony. Following the island's independence in 1960, Turkish and Greek Cypriots shared authority in an administration.

However, this political arrangement failed to resolve the conflict between the two communities, and tensions on the island increased rapidly. When Greek Cypriots attempted to seize power through a coup d'état, Turkey invaded the north of the island in a military operation in 1974. Finally, the Turkish Republic of North Cyprus was founded in 1983.

I have talked to many locals living in North Cyprus who strongly defend their independence and expect the international community to recognize their political authority. I fully respect these people's self-determination rights. It should also be noted that the island's division presents favourable opportunities for expats. 

Speaking of the island's partition leads us to its current political situation. Let's examine why political tension has given way to a permanent status quo.

With North Cyprus being more affordable, some Cypriots work in the south but live in the north, and this coexistence helps ease the political climate

THE UNITED NATIONS PEACE EFFORTS: THE ANNAN PLAN

Several peace talks and negotiations have been held to unify the island. However, the most notable of these plans was the Annan Plan. The Plan was a comprehensive proposal developed by United Nations Secretary-General Kofi Annan to resolve the longstanding Cyprus dispute. 

The Annan Plan proposed the creation of the United Republic of Cyprus, a federal state consisting of two constituent states: the Greek Cypriot State and the Turkish Cypriot State. This structure was intended to provide political equality and representation for both communities.

In April 2004, the plan was put to a referendum. 65% of Turkish Cypriots supported the plan. They considered it as a path to international recognition and European Union membership. However, only 24% of Greek Cypriots voted in favour, leading to its rejection.

INTERCOMMUNAL RELATIONS AFTER THE CYPRUS’ ACCESSION TO THE EU

The fact that this meticulously worked-on peace negotiation ended without a result revealed the need for closer relations between the island's administrations. Following the referendum, Cyprus was admitted to the European Union (EU) in 2004, and the issues between the two communities have become part of EU politics. 

With a comprehensive agreement out of the question for the time being, interim solutions have begun to emerge. The first noticeable policy change was that Turkish Cypriots started to acquire Cypriot citizenship as a second passport. With the support of the Cypriot government, thousands of Turkish Cypriots obtained Cypriot passports.

The second visible change was the establishment of checkpoints in 8 regions of the island. These checkpoints allow members of both communities and tourists to easily visit both sides of the island. 

I saw the Greek neighbourhoods from many places in north Nicosia. The crossing is marked by a buffer zone known as the "Green Line," which is monitored by UN peacekeepers. On both sides of the checkpoint, you will see flags representing each territory. The crossing itself is narrow, with a mix of old and new buildings on either side.    

As North Cyprus is more affordable than the south, some Cypriot citizens continue to work in the south while living in North Cyprus. With the advantage of communities living together for hundreds of years and softening the political climate, the islanders quickly began establishing mutual friendships and trade relations. 

The island's division created a significant legal issue: how to legally settle the ownership of abandoned real estate belonging to private individuals in the north and south. Nevertheless, the EU had an effective solution to address the issue. 

ESTABLISHMENT OF THE IMMOVABLE PROPERTY COMMISSION

The EU acted swiftly and established the Immovable Property Commission (IPC) in Cyprus to resolve property disputes between Turkish Cypriots and Greek Cypriots definitively based on international law. Since 2005, IPC has been working as an organization under the European Court of Human Rights (ECHR) ruling on property claims by Greek Cypriots who lost their property during the 1974 conflict. 

The title deeds of real estate in North Cyprus have been the main international legal issue since the island's petition. The IPC has increased legal certainty for foreign investors in North Cyprus by clarifying property rights and providing a legal framework for transactions. This economic stability has encouraged investment and development, benefiting both communities.

The Annan Plan and the permanent solutions that followed it have greatly paved the way for North Cyprus. In a short time, tourism, casinos, higher education, and, of course, real estate investments have become the focus of investors. Let's take a look at why all these developments matter to expats. 

HOW IS NORTH CYPRUS TODAY?

The Annan Plan had visible effects on people's daily lives, economic developments, and cultural structures. The biggest change for Turkish Cypriots was the opening of the border gates. Border crossings with the Greek Cypriot side rapidly increased the social and economic relations of the islanders. Many Turkish Cypriots gained job opportunities in Southern Cyprus, and the island became more integrated.

The opening of the border gates significantly increased foreigners’ access to North Cyprus. Visitors can now visit North Cyprus as if visiting any European Union country. The first result of the ease of transportation is the exponential growth of tourism in North Cyprus. The luxurious hotels and casinos in the North have attracted great interest from tourists, especially from Europe and the Middle East.

Social interactions between Greek Cypriots and Turkish Cypriots have become more visible. When visiting Cyprus, it is important to remember that these two different communities have lived together for approximately 700 years and have significant similarities from their food cultures to their family structures. Turkish Cypriots are mostly Muslim, but secular practices largely shape social life.

Although Turkish and Greek are distinct national languages ​​on the island, bilinguals are common in both societies. Moreover, perhaps because it is a former British colony, English continues to be widely spoken as a foreign language. I have never encountered any problem with English since even the shopkeepers speak English. 

It is difficult and probably unnecessary to track which cultural element belongs to whom on this island where Turkish, Greek, Mediterranean and Middle Eastern cultures blend. You can experience this rich cultural blend through the local cuisine. Local delicacies such as halloumi cheese, peach kebab, molehiya and kolakas are popular with both locals and tourists. Fish restaurants, especially in coastal areas, whet the appetite with their fresh seafood delicacies and reasonable prices.

The nightlife in North Cyprus is the kind that those who stay up all night will enjoy. Especially in cities such as the capital Nicosia, Kyrenia and Gazimagusa, bars, nightclubs, and cafes offer a never-ending range of activities. Nightlife in North Cyprus cannot be considered separate from casinos. Luxurious and diverse casinos offer a small Las Vegas experience. In addition, festivals and cultural events are also quite common. International music and theatre festivals, especially in spring, have attracted a serious international following.

History enthusiasts will also return from North Cyprus with satisfaction. Artifacts from the ancient Greek civilization, the Eastern Roman Empire and the Ottoman Empire, sometimes dating back over a thousand years, continue to surprise newcomers. I am also fascinated by some of these Gothic-style castles. 

In short, North Cyprus is in an incredible transformation process compared to twenty years ago. The young population has turned its face to advancement and is pursuing new opportunities. Investment opportunities are everywhere for those who want to see them.

WHY NORTH CYPRUS MATTERS TO EXPATS

North Cyprus witnessed fast economic growth since 2004. It has easily become a tourist destination with its Mediterranean beaches and ancient ruins. Foreign students flocked to the rapidly opening new universities, easily turning North Cyprus into a metropolitan island. Casinos, crowded bars, and clubs in cities such as Kyrenia and Nicosia have created a never-ending nightlife throughout the year. In 20 years, North Cyprus has managed to surprise visitors with its cultural diversity and growing economy. However, the most exciting investment opportunity is the fast-growing real estate sector.

BOOSTING SECTORS IN NORTH CYPRUS   

There are several expanding sectors in North Cyprus. The first one is tourism. In 2022, the sector rebounded strongly, with a 41% increase from the previous year, contributing 31% of North Cyprus' GDP. The island attracts visitors with its stunning beaches, historic sites, and cultural experiences. Popular spots like Kyrenia and the Karpaz Peninsula draw tourists from Turkey, Europe, and beyond. Infrastructure projects have also boosted marina tourism, bringing in international yacht travellers each year.

The casino industry in North Cyprus has also grown rapidly, with over 20 casinos, mainly in Kyrenia and others in Famagusta and Nicosia. These casinos attract both tourists and serious gamblers from Europe and the Middle East, making North Cyprus a rising gambling hub. Casinos are a key part of North Cyprus's economy. Their growth helps boost economic development and create jobs.

Higher education is essential for North Cyprus’s economy. It is supported by strong investment and attracts thousands of international students each year. The region hosts 16 accredited universities, offering globally recognized degrees and fostering a rich multicultural environment. 50,000 students from nearly 70 countries continue their higher education in North Cyprus. 

All these thriving sectors drive the need for infrastructure development and new housing, giving the real estate market a significant edge.

North Cyprus presents promising investment potential, with growth in tourism, education, and young population driving opportunities, especially in real estate

WHY NORTH CYPRUS MATTERS TO YOU

The social, economic and political situation of North Cyprus may cause those who are unfamiliar with the island to hesitate. North Cyprus is part of the European Union in terms of international law, but it is actually an independent state. Although Turkish Cypriots make up the country's demographics, multiculturalism and cosmopolitanism dominate the island's culture. Most of the population is Muslim, but secular practices form the basis of social life. The official language is Turkish, but English is an ordinary part of daily life. Greek Cypriots living in the north, Turkish Cypriots who are citizens of Cyprus, tourism and casino activities that continue throughout the year, and thousands of students coming from many different countries to study reflect the complex social structure and economy of North Cyprus.

If you look from the outside, you may not be able to understand this small but complex society. Cyprus's division may cause some to hesitate to invest. For me, Cyprus' complexity means potential investment opportunities. There might be a good chance to get ahead of the crowd investing in North Cyprus. 

Although the economy of North Cyprus has developed and diversified rapidly since 2004, the country is still at the beginning of the road. As I explained, although there are different investment sectors, all economic growth will most probably favour the real estate sector. All kinds of tourism and casino activities, students flocking for university education, young population seeking to establish their lives and investors in search of new markets are the main reasons for a possible boom in the real estate sector. 

Prices in North Cyprus, which has stabilized its political problems with the south of the island with interim solutions, will likely approach other Mediterranean countries. I am not even talking about the island reaching a definitive political solution on unification. For these reasons, I will closely watch investing opportunities in North Cyprus.

With stable interim agreements in place, North Cyprus offers a wealth of investment opportunities for expats in a secure and promising environment

CONCLUSION

Although Turkish Cypriots and Greek Cypriots have not yet found a permanent political solution, they have agreed on interim solutions that will ensure political and economic stability on the island. The status quo, established under the guarantee of Turkey, Greece, the UK, and the EU, is firmly maintained.

North Cyprus may offer many options for expats looking to expand and diversify their investments. I have worked on many projects and developed a strong understanding of the island. In this regard, it is worthwhile to keep an eye on North Cyprus and stay alert to new opportunities.

For years, I have been guiding my clients about the latest and safest investment opportunities and providing them with all the expert support they need. North Cyprus awaits its investors with its magnificent nature, rich history, and bright future. I would be happy to guide you in your endeavours.