Russia was trying to fill the power vacuum by expanding the Czar's empire west and south toward the warm water port of Constantinople and the Dardanelles.
In 1906, a new harbour at Famagusta was completed, increasing the importance of Cyprus as a strategic naval outpost protecting the approaches to the Suez Canal.
Early in the First World War the Ottoman Empire joined the Central Powers, and on 5 November 1914 Britain annexed Cyprus, bringing an end to the Convention.
The terms of the Convention provided that the excess of the island's revenue over the expenditures for government should be paid as an "annual fixed payment" by Britain to the Sultan.
Governor of the island Ronald Storrs later wrote that the calculation of this sum was made with "all that scrupulous exactitude characteristic of faked accounts."
The Cypriots found themselves not only paying the tribute, but also covering the expenses incurred by the British colonial administration, creating a steady drain on an already poor economy.
Instead it was deposited in the Bank of England to pay off Turkish Crimean War loans (guaranteed by both Britain and France) on which Turkey had defaulted.