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By Michele Kambas
NICOSIA (Reuters) - Cypriots gave a guarded response on Wednesday to Britain's offer to hand back half its remaining three percent of Cyprus's landmass if rival sides on the ethnically split island reach a peace deal.
Former colonial power Britain on Tuesday offered land within its two pockets of prime real estate in the south of the island, which was split in 1974 in a Turkish invasion triggered by a brief Greek-inspired coup. It does not include any British military facilities on the island, which has a massive Royal Air Force base.
The offer is contingent on a long-elusive peace deal between Cyprus's estranged Greek and Turkish Cypriots engaged in reunification negotiations for more than a year. It was made to the United Nations, which is overseeing the peace talks.
"We have not discussed this among ourselves. Hence it is not possible to make an extensive assessment on the subject," said Turkish Cypriot leader Mehmet Ali Talat.
Greek Cypriots were lukewarm. "What Britain can do if it wants to effectively help this process is to exert influence and encourage Turkey to be more accommodating on the talks," said Markos Kyprianou, Cyprus's foreign minister.
Cyprus's long running conflict is hampering Turkey's bid to join the European Union, and is a source of tension between NATO allies Greece and Turkey. The island is represented in the EU by its Greek Cypriots, who are using membership as leverage to gain concessions from Turkey in cracking the conflict.
Peace talks started between the Greek and Turkish Cypriot sides in September 2008.
Britain had been expected to make a gesture to aid the present talks and the offer came before a meeting on Wednesday in London between Prime Minister Gordon Brown and Demetris Christofias, the Cypriot president.
After the meeting Brown confirmed the bases offer and said it was up to the island's Greek and Turkish Cypriot leaders to negotiate what happened with the land.
"It is important that the solution to the Cyprus problem is a Cypriot one -- a solution by Cypriots for Cypriots," he said.
"My message to Cyprus' leaders and to their people is: you can make history. Be bold, be courageous. The UK will support you."
The bases offer has been made once before, in 2003, when the Cypriot sides were discussing a U.N. reunification blueprint.
The U.N. plan failed to win support of Greek Cypriots when it was put to referendum in 2004. The present peace process is Cypriot-led, with the Greek Cypriots ruling out any question of being given a blueprint to vote on by outsiders.
Diplomats say territorial adjustments would be an integral part of any deal to unite Cyprus as a federation with two semi-autonomous zones -- one Greek and one Turkish Cypriot, so any additional land thrown into the mix is important.
Turkish Cypriots now control some 37 percent of Cypriot territory, and previous reunification proposals have given the numerically larger Greek Cypriots a bigger proportion of territory than they now occupy.
Britain's territory on the island covers 98 square miles but only part is used for military purposes. Much is put to civilian use by Greek Cypriot farming communities.
There are army barracks at Dhekelia, in the south-east, and an RAF base at Akrotiri, in the south. Akrotiri is used to provide logistical support to forces in Iraq and Afghanistan.
(Additional reporting by Daren Butler and Tim Castle; editing by Ralph Boulton)

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