As agreed on 28 February, the two leaders came to The Hague yesterday for a very specific and agreed purpose. I asked each of them whether they were prepared to commit today to submit my 26 February 2003 plan to approval at separate simultaneous referenda on 30 March 2003 in order to achieve a comprehensive settlement of the Cyprus Problem.

Mr Papadopoulos answered that he was prepared to do so, as long as the people knew what they are being asked to vote on. To that end he wished to be sure that the gaps regarding federal legislation, as well as constituent state constitutions, would be filled. He underlined the importance of Greece and Turkey agreeing and committing to the security provisions in the plan. Furthermore, considerably more time was needed than was available for a proper public campaign on the referendum to be carried out. These conditions need to be fulfilled before a referendum can take place. He said he was prepared not to re-open its substantive provisions if the other side was prepared to do likewise.

Mr Denktash answered that he was not prepared to agree to put the plan to referendum. He said he had fundamental objections to the plan on basic points. He believed that further negotiations were only likely to be successful if they began from a new starting point and if the parties agreed on basic principles. He added that Turkey was in any case not in a position to sign the statement requested of the guarantors because this first required the authorisation of parliament.

Efforts have continued in the course of yesterday and during the night to salvage the process and keep open the prospect of a reunited Cyprus acceding to the EU. I even suggested that negotiations could continue until 28 March with a view to holding the referenda one week later on 6 April. Regrettably, these efforts were not successful for the reasons stated above.

Accordingly, as I said when I left Cyprus on 28 February, we have reached the end of the road. The two leaders have expressed their willingness to continue talks. But without a firm commitment to proceed energetically to a conclusion according to a strict work programme, culminating in separate simultaneous referenda, it will clearly not be possible to achieve a comprehensive settlement before the accession of Cyprus to the European Union on 16 April. That commitment is not in place at this time. I have therefore asked Mr de Soto to proceed to New York to prepare a detailed report to the Security Council. Mr de Soto's office in Cyprus will be brought to a close in the coming weeks.

I share tonight with all peace-loving Greek Cypriots, Turkish Cypriots, Greeks and Turks a deep sense of sadness. I am not sure another opportunity like this one will present itself again any time soon. Nevertheless, I want the people of Cyprus to know that I have not given up on them. I saw in their eyes their longing for peace and reunification. I regret that they have been denied the chance to decide their own future.

My plan remains on the table, ready for the Greek Cypriots and Turkish Cypriots to pick it up and carry it forward to a solution if they summon the will to do so. If I see that there is a clear and realistic prospect of finalizing negotiations, with the full backing of the motherlands, I will be ready to assist. Let us hope that that day is much closer than it seems this morning.