In accordance with Public Law 95 - 384, I am submitting herewith a bimonthly report on progress toward a negotiated settlement of the Cyprus question.

Since my previous report, the leaders of the two Cypriot communities participated in a summit meeting in New York January 17 - 20 under the auspices of United Nations Secretary General Perez de Cuellar. At the outset of the meeting, the Secretary General expressed his expectation ``that the parties would conclude an agreement containing the elements necessary for a comprehensive solution to the problem, aimed at establishing a Federal Republic of Cyprus.'' Had this effort succeeded, it would have set in motion a process that -- over a period of time in which further concrete negotiations would take place -- could have led to a true resolution of the Cyprus problem. Following the summit's close the Secretary General announced that the Turkish Cypriot side has ``fully accepted the draft agreement'' and that the Greek Cypriots had accepted the documentation ``as a basis for negotiation.'' While he acknowledged that the failure to bridge the gap between these two positions meant that the summit had not achieved its goal, the Secretary General added that the two sides ``had never been so close'' and that he would continue his efforts.

The Turkish Cypriots, following the failure of the January summit, announced their intention to proceed to parliamentary elections in June 1985. The Turkish Cypriots have said the elections would not preclude their continued participation in the Secretary General's process and in an eventual federal Cypriot state. We have registered with both communities our conviction that any actions that might damage chances for the UN Secretary General's pursuit of a fair and lasting solution should be avoided. The Secretary General met with President Kyprianou in Geneva on March 11 where they discussed next steps in the pursuit of a solution.

Since my last report to you, Administration officials have met regularly with leaders of both Cypriot communities, including a meeting March 11 between Vice President Bush and President Kyprianou in Geneva and the ongoing contacts in Cyprus between Ambassador Boehm and both President Kyprianou and Mr. Denktash. We continue to work closely with the two Cypriot parties, and with the governments of Greece and Turkey, in support of the Secretary General's program. We urge flexibility by all parties, and we are encouraged that they continue to support a negotiated solution.

Sincerely,

Ronald Reagan

Note: Identical letters were sent to Thomas P. O'Neill, Jr., Speaker of the House of Representatives, and Richard G. Lugar, chairman of the Senate Foreign Relations Committee.