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Israeli Prime Minister Benjamin Netanyahu met Cyprus President Dimitris Christofias during the first ever visit by an Israeli prime minister to Cyprus in mid-February.
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Following the discovery of huge gas reserves beneath the seabed between Cyprus and Israel, the two countries have begun pursuing joint energy projects.

A New Era in Israel-Cyprus Relations

Benjamin Netanyahu’s visit to Cyprus in mid-February, the first ever by an Israeli prime minister, marked a new era in relations between the two countries. Following the discovery of huge gas reserves in their respective exclusive economic zones, Israel and Cyprus have begun pursuing joint energy projects and exploring further avenues for regional cooperation. “The flight from Israel to Cyprus is about 45 minutes... it has taken 63 years for an Israeli PM to make this trip and I want to thank you for the invitation and the friendship that is developing between the two countries,” Netanyahu said during his visit.

Mutual Interests and Concerns

As longstanding democracies in the eastern Mediterranean, Israel and Cyprus have a great deal in common. It is only recently, however, that ties between the countries have grown close, driven by shared economic interests as well as developments in the region.

Natural gas reserves have been found beneath the seabed between Cyprus and Israel. Last December, Texas-based Noble Energy, which is operating in both countries, reported a massive offshore gas prospect in a Cypriot field. Noble is working with Israel’s Delek Energy to develop two fields in Israeli waters, dubbed Tamar and Leviathan. These resources are expected to allow the countries not only to be self-sufficient in terms of their gas needs, but also to become energy exporters.

In addition to economic considerations, geopolitical concerns have led Israel and Cyprus to develop strong relations. Both countries face a rapidly changing neighborhood amid the Arab Spring and subsequent rise of Islamist parties in the region, as well as an increasingly belligerent Turkey. Ankara has been at loggerheads with the Cypriot government ever since its military invasion of northern Cyprus in 1974. Tensions with Israel are more recent, relations having frayed following the 2010 flotilla incident.

Growing Cooperation

Cooperation between Israel and Cyprus has greatly expanded in the past few years in a wide range of areas, from tourism to agriculture to science. Commercial ties have expanded, with Israeli businesspeople investing primarily in Cyprus’s tourism and real estate sectors, while also taking advantage of the island’s low corporate tax to open offices and list offshore companies there.

Both countries have made symbolic humanitarian gestures, further strengthening relations. Cyprus sent firefighting planes to aid Israel in putting out the Carmel forest fire in December 2010. Israel was able to return the favor in July 2011, when it sent generators to supply electricity to the island, after a massive explosion at a munitions dump disabled Cyprus’ main power plant and killed 13 people, including the commander of the country’s navy.

High-level meetings have become routine, including a visit by Israeli President Shimon Peres to Cyprus in November 2011, a January visit by Cypriot Defense Minister Dimitris Eliades to Israel, during which he invited Israeli Defense Minister Ehud Barak to visit Cyprus, and the most recent, historic trip by Netanyahu to Cyprus.

During the trip, Netanyahu focused on potential collaboration in energy exploitation and security. “I came here to develop our bilateral ties, our economic ties in the field of energy,” said Netanyahu after talks with Cypriot President Dimitris Christofias in Nicosia. “We are interested in developing peaceful relations for the benefit of the two countries and of the region as a whole.”

The two states inked a deal to launch a joint natural gas and oil exploration venture in their adjoining territorial waters. The deal will also allow Israel to use Cyprus’ air space and territorial waters for aerial and naval search and rescue drills. It comes on the heels of multiple bilateral agreements signed in recent years, including an agreement to demarcate the maritime exclusive economic zone border between the countries as well as two agreements on defense cooperation and the protection and exchange of classified information.

Already, the countries have embarked on projects intended to develop and utilize their newly found energy resources together. Israeli companies have set up shop in Cyprus, seeking to take part in oil and gas exploration off the island. Preparatory work on an underwater power cable is underway, in order to boost both nations’ energy security and allow them to export energy to continental Europe. The project, lauded as the most ambitious of its kind, is eventually meant to become part of a much longer cable, stretching into Greece and from there to the pan-European electricity grid.

“The improvement in relations has been fantastic,” Cypriot Ambassador to Israel Dimitris Hatziargrou said in a recent interview. “The bottom line is, I feel that we are pouring the foundation for a long-term friendship.”