Nicosia - Initial optimism from earlier this year that one of the world's most unmanageable conflicts might finally be solved has waned in Cyprus as peace talks failed to produce a breakthrough in 2008.

The only tangible outcome following the weekly meetings between Greek Cypriot President Dimitris Christofias and Turkish Cypriot leader Mehmet Ali Talat has been the realization that a long road still lies ahead of any breakthrough, despite the enthusiasm that greeted a new round peace talks in September following a four-year stalemate.

"I think obviously the process will go into 2009 and as long as the momentum is sustained, they can achieve a good solution in the end," said Alexander Downer, a former Australian foreign minister and UN special envoy to the talks.

"It is a long-standing problem which has many different facets. They need to maintain momentum and not lose momentum ... I think to set themselves official deadlines would actually make the process more difficult rather than easier."

The eastern Mediterranean island has been split since 1974, ever since Turkey invaded the northern third of Cyprus in response to a short-live coup initiated by the military junta then ruling Greece.

Ankara still maintains more than 35,000 troops in the northern part of the island and refuses to normalize ties with the internationally-recognised Republic of Cyprus, an EU member.

Since then, countless efforts by the United Nations to find a solution to the decades-old problem have failed, most recently when former president Tassos Papadopoulos led the Greek-Cypriot rejection of UN reunification plan in a 2004 referendum. Turkish Cypriots had overwhelmingly voted in favor.

Following the election of Christofias in February, in which he ousted hardliner Papadopoulos, immediate steps were taken by both sides to relaunch full-fledged peace talks.

Although a settlement has been thwarted for decades, mediators are more optimistic that Christofias and Talat are the best individuals in place to broker a deal, since they are both moderates.

In April, the barricades that separated the capital's main shopping district along Ledra Street or Lokmaci, as the street is known in Turkish, in downtown Nicosia for nearly half a century were ordered to be torn down by the two leaders.

Ledra Street had been barricaded since 1964, when British peacekeepers decided to divide the street between Nicosia's Greek and Turkish communities in the aftermath of intercommunal fighting.

The move to open up the symbolic crossing over the United Nations- controlled buffer zone indicated a climate of trust, enabling Cypriots to walk the entire length of the street without having their stroll disrupted by military posts.

But despite all the fanfare, the talks, which have been taking place at the site of the abandoned, bullet-riddled former airport of the UN buffer zone, have failed to produce a quick agreement as leaders attempt to tackle a wide range of complex issues.

"It's not in our interest to waste time. We want a solution to reunite the people, the region, as soon as possible," Christofias told a news conference during a recent visit to Athens, urging Talat to show more independence from Ankara.

"If Turkey adopts a good attitude, if it shows understanding, then yes, we could have a solution in 2009."

On the agenda are issues ranging from: territory and property disputes from more than 250,000 who have lost their homes; the return of refugees; security guarantees; and future governance of the island.

Any deal will need to be approved by Cypriots in separate, simultaneous referendums.

After more than a dozen meetings, the two leaders have not progressed beyond the issue of governance and power sharing under a future federation.

"I think there is a growing understanding between the two sides of their positions and as time goes on, of course, the gaps are going to narrow," Downer told journalists after one of the meetings.

The two sides have agreed in principle to a settlement based on a federation, but there are disagreements on how it would work and the degree of authority each side would have in a future central government.

The Turkish Cypriots want a loose federation, while the Greek Cypriots want a stronger central government and more limited regional powers which will prevent the island falling back into partition.

"I am faithful to my word to seek a fair and permanent peaceful solution and to reunite Cyprus under a federal roof," Talat said in November in a televised address to the nation to mark the 25th anniversary celebrations of the declaration of the Turkish Republic of Northern Cyprus.

"A community and its administration do not fade away when they are ignored," he said.

The ongoing conflict in Cyprus also threatens Turkey's aspirations of joining the European Union. Ankara started EU entry talks in
2005, but the Cyprus problem has proved one of the main stumbling blocks in negotiations.

Tensions recently erupted when Cyprus complained to the United Nations that a Turkish warship was harassing oil and gas exploration vessels in its waters. Ankara maintains that the ships were encroaching on its continental shelf.

"We will not agree to Turkey's EU membership while it continues to violate the sovereignty of an EU member," Christofias said. (dpa)