Cyprus was split in a Turkish invasion in 1974 triggered by a brief Greek inspired coup  [Reuters]

Turkey hopes terms for the reunification of Cyprus can be agreed upon by the end of the year so that a referendum can take place in early 2012 before the island takes over the European Union presidency later that year.

Turkish foreign minister Ahmet Davutoglu, in Cyprus on Saturday for talks with Turkish Cypriot leader Dervis Eroglu, said it would would be a mistake and against European values for one side to represent the divided island, while the other side remained isolated.

"We hope to find a solution to the Cyprus problem by the end of the year, and hold a referendum in the early months of next year so that Cyprus can take on the presidency of the EU as a new state that represents the whole island," Davutoglu said.

Cyprus was divided into a Turkish Cypriot north and a Greek Cypriot south in 1974 when Turkey invaded after a coup by supporters of a union with Greece.

Greek Cypriots represent the island internationally and in the European Union, while Turkey is the only country to recognise the Turkish Cypriot state.

The Cyprus dispute is a major obstacle for Turkey's bid to join the European Union, aside from opposition from EU heavyweights France and Germany. Greek Cypriots say Turkey cannot join the bloc until the Cyprus conflict is resolved.

The EU also expects Turkey to implement the Ankara Protocol, whereby Turkish ports and airports will be opened to traffic from Cyprus. Turkey says the EU should also end its blockade of the Turkish Cypriot territory.

"A solution will bring real peace to the eastern Mediterranean and truly unite Europe," Davutoglu said.

UN Secretary-General Ban Ki-moon said after meeting Eroglu and Greek Cypriot leader Demetris Christofias in Geneva on Thursday that he expected the two sides to overcome their differences by October.

Almost three years of UN-mediated talks in the latest peace drive has produced limited progress. 
Ban said he expected both sides to ramp up talks and to reach agreement by October on all core issues.

The two sides have made some progress on how they might govern themselves in an envisioned federation, but other core issues have yet to be discussed, including how to settle territorial adjustments and claims on private property lost after the 1974 war.

Any settlement would need approval from both sides in separate referendums. In a referendum in 2004 Turkish Cypriots voted for reunification, but Greek Cypriots rejected it.