This paper considers the challenges ahead after having assessed what determined the outcome of the referendum in April 2004 and the balance of forces as they emerge in the Parliamentary elections of 2006. In spite of the generally sound claims that globalisation shifts decision-making away from nation-states, particularly weak and small states to networks beyond the nation-state, in the case of Cyprus what we have for the first time paradoxically is the “fate” of Cyprus primarily in the hands of Cypriots themselves. Although semi-occupied the two communities can make their decision as to the future of their country and state, providing they agree to share power in a federal state. This would mean addressing the obstacles they are facing, including the current polarisation of Greek-Cypriot opinion, which is divided amongst those who want to live together with the Turkish Cypriots and those who want to live apart. The Parliamentary elections of 2006 have not resolved matters. The key to the future of Cyprus is the contestation between the “hard no” and the “soft no”, which at the same time is the contestation between the “Right” and the “Left”: the paradox is that they are coalition partners in Government.
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