31/01/25

ENERGY NEWS

There was a debate in Turkey’s parliament concerning drilling work being carried out by ExxonMobil and QatarEnergy in Block 5 of Cyprus’ exclusive economic zone (EEZ).

Ruling AK Party deputy leader Leyla Sahin Usta explained that according to maritime claims recognised by the Turkish government, Block 5 belongs to Egypt and not Turkey, and that thus it is not Turkey’s place to protest against or attempt to stop ExxonMobil and QatarEnergy’s operations. Opposition MPs has a different opinion noting the area being drilled belongs to Turkey and wondering where the Turkish boats are. Turkey’s foreign ministry was also asked to make a statement.

A substantial drop in the cost of electricity this year is “impossible,” Energy Minister George Papanastasiou said, adding that people should manage their expectations.

According to the minister, the future use of natural gas should drive electricity prices down by about 30 per cent. The full operation of the competitive electricity market would result in another 5 to 10 per cent fall.

On the competitive electricity market, the minister said it’s currently in its trial phase – lasting from January through to July.

Philenews reported that although the issue of electricity adequacy in the coming years (especially in the southeastern region) is being tried to be kept out of the public eye, it is a very serious concern for the competent authorities.

The Ministry of Energy has already resorted to the Directorate-General for Competition of the European Commission, requesting its approval so that the installation of two new flexible gas turbines in Dhekelia can proceed quickly.

The obstacle to the purchase and installation of the two gas turbines is their unexpectedly high cost (bids for the generators alone were submitted for an amount of around 140 million euros) and the reluctance of the EAC to bear the cost itself, The EAC argues that the cost for turbines (over a period of 20 years), in combination with the operation of a competitive market, will only financially burden EAC customers and will harm the organization operationally.

ECONOMIC NEWS

40% of the sales contracts registered from January to October 2024 concern non-Cypriot buyers, AKEL MP Giorgos Koukoumas, said during a meeting of the Parliamentary Committee on Interior.

The Committee began the discussion on the consequences of the mass purchase of real estate by third-country nationals, following a proposal by Mr. Koukoumas, as well as the discussion on a bill proposed by DISY MP, Nikos Georgiou, to modernize provisions concerning the procedure for acquiring real estate by foreigners. Koukoumas noted that the State should map the situation and analyze the benefits and side effects of the phenomenon of mass purchase of real estate by foreign citizens, as well as examine what needs to be done to address the side effects.

Furthermore, he expressed the belief that the dimensions of the phenomenon and the numbers are greater than the data indicate, because companies with foreign shareholders that are registered in Cyprus are considered Cypriot buyers.

DISY MP Kyriacos Hadjiyiannis pointed out that “we are selling off land to create development”

According to data, it appears that since 2015 in the provinces with coastal areas, the majority of sales documents (from natural persons) concern foreign buyers. As the same data shows, the percentage of these buyers in Nicosia is much smaller.

29/01/25

ENERGY NEWS

The energy minister and the natural gas infrastructure company (Etyfa) met to review the state of play with the LNG project at Vasiliko and what the next steps will be.

The discussion also aimed to set a firm, binding timetable for the completion of the project – both as concerns the onshore LNG facilities at Vasiliko, as well as for the floating, storage and regasification unit (Fsru) currently located in Malaysia.

A number of states and/or companies have shown interest in using the Fsru temporarily, before it finally comes to Cyprus.

The vessel cannot come to Cyprus yet as the onshore LNG terminal at Vasiliko is incomplete. The government says that works on the terminal should be finished by the end of the year.

One of the interested parties is Egas, a state-owned Egyptian company. Another is Abu Dhabi-based Adnoc, also a state-owned corporation. Yet another is Excelerate Energy, a US LNG company with a global presence.

Because the Fsru vessel is a public asset, the government has to go through the process of inviting formal expressions of interest, then selecting the company that gets to use it.

ECONOMIC NEWS

INBNews reported that the Mayor of Larnaca and the President of the Larnaca Chamber of Commerce and Industry, were invited to comment on the proposal by Prosperity, under which the company – a 20% shareholder in the Kition Ocean Holdings consortium – requests the state to consider the possibility of reviving/restoring the concession agreement to Kition for the Larnaca port and marina project.

The Minister of Transport, Communications and Works did not want to make any comment.

They noted that whatever the final decision is, it must be ensured that the development of the marina and port of Larnaca will be implemented smoothly and without setbacks

The Mayor underlined that it is important to clarify whether or not the reinstatement of the project to Kition is legally permitted.

He added that it is also important for the Ministry of Transport to check whether the necessary funds, guarantees and safeguards exist to implement the project, as provided for in Prosperity’s proposal.

Russian billionaire oligarch Roman Abramovich employed an intricate offshore scheme to avoid paying millions in value-added tax (VAT) on his fleet of luxury superyachts, according to leaked documents.

The investigation by the Guardian, BBC, Bureau of Investigative Journalism, Der Spiegel and ZDF revealed how Abramovich’s companies potentially circumvented tax obligations worth tens of millions of dollars, much of which should have been paid to Cyprus.

Available rental properties across Cyprus have reached 4,484 units, with apartments averaging €1,803 and houses €3,249 monthly, according to new data released by Landbank Analytics.

The analysis reveals a significant regional price disparity, with Limassol commanding the highest rents.

The city accounts for 45% of available apartments nationwide, with an average monthly rent of €2,742, substantially above the national average.

Philenews reported that the acquisition, by PureHealth, based in Abu Dhabi, of the majority stake (60% of the shares) of Hellenic Healthcare Group, which was held by CVC Capital Partners, affects Cyprus as well.

The agreement, is not going to affect the management of the private hospitals owned by the company in Cyprus.

What is going to change is the presence of Hellenic Healthcare Group (with the new composition) on the island, since its goal is to invest even more in the health sector and at multiple levels.

IN Cyprus the company owns the Apollonius Private Hospital, the Aretaeio and the American Medical Center, while it is also planning the development of a new private hospital, American Medical, in Limassol.

27/01/25

ENERGY NEWS

Drilling work has begun in Block 5 of Cyprus’ exclusive economic zone (EEZ), President Nikos Christodoulides announced. The reservoir is named Electra and works are carried out by American multinational corporation ExxonMobil and QatarEnergy. 

Cyprus issued a Navtex in relation to the start of drilling . Energy Minister George Papanastasiou has said previously that the drilling results were expected to be known by the end of February and an official announcement would be made at the end of March.

The President of the Republic will be in Cairo on February 17, for the signing of two agreements concerning the development of natural gas deposits in the Cypriot EEZ.

The agreements are among the most important ever signed by Cyprus over the exploitation of natural gas fields, Energy Minister George Papanastasiou said.

Philenews reported that one is a Host Government Agreement-a formal and binding agreement (as opposed to a memorandum of understanding or letter of intent) between a foreign investor and the government of the host country, which outlines the terms, conditions and obligations for the investment. President Christodoulides will not sign this agreement. The Agreement finalizes the exploitation of the Kronos reserve (block 6) partly for the Egyptian market and partly as liquefied gas for foreign markets.

A Memorandum of Understanding will also be signed by the governments of Cyprus and Egypt and the Aphrodite consortium (Chevron, Shell, New Med). The memorandum is not binding but is a positive step towards the next binding agreements. The information indicates that the content of the memorandum of understanding will be similar to the content of the Host Government Agreement. It will express the intention of the two governments and the Aphrodite consortium to transport Aphrodite’s natural gas (just under 4 trillion cubic feet) to Egypt for commercial exploitation, within the country but also at a liquefaction terminal, so that it can be exported to other markets.

Last week, intensive and long-lasting discussions took place in Nicosia between delegations of the Republic of Cyprus, led by Energy Minister George Papanastasiou, and Chevron. The discussions concerned the negotiation of the latest proposal submitted by Chevron in the autumn for the development plan of the Aphrodite field.

President Christodoulides & Energy Minister George Papanastasiou met with Egyptian Minister of Petroleum and Mineral Resources Karim Badawi to discuss bilateral cooperation on gas transmission projects. The primary focus of the meeting was the commercialisation of natural gas deposits within Cyprus’ Exclusive Economic Zone (EEZ). Discussions centered on enhancing the energy security of both countries through joint infrastructure projects. According to a joint statement, these initiatives could form part of a “new energy corridor from the Eastern Mediterranean to Europe” and expedite the commercialisation of Cyprus’ natural gas fields. Plans were outline to transport gas from Cyprus’ EEZ to Egypt for liquefaction and subsequent export to international markets.

Politico reported that Turkey is launching a diplomatic effort to restart energy negotiations with the European Union, eyeing the prospect of becoming a major supplier of natural gas, after previous discussions were derailed by tensions with Cyprus.

In comments, Turkey’s EU ambassador, Faruk Kaymakcı, said that energy cooperation would be put front and center on its agenda, as part of a planned thawing of relations that will include trade talks and political cooperation on wars in Eastern Europe and the Middle East.

ECONOMIC NEWS

INBNEWS with the title: “The other side of the coin…The ‘divorce’ for the marina and the port of Larnaca project from the perspective of the contractor” reported that sources from Prosperity Group CY, a 20% shareholder of Kition Ocean Holdings, give their own version of the events that led to the ‘divorce’ with the Government. Their basic position is that not all possibilities for finding a solution and continuing the contract have been exhausted. There was a dispute about the amount of the guarantee (the government was talking about 10.4 million euros and Kition for 4.2 million euros). In December 2023 Kition had renewed a guarantee which proves their intentions to continue with the project. The govt. was insisting on the payment of the guarantee of 10.4 million while it also criticized the company for delays. The sources counter-argue that a lot was done and Kition spent more than 35 million euros.

Israeli secret services have ordered all flights by Israeli carriers not to land in Paphos due to unspecified security concerns as of on Monday. Deputy Government Spokesman Yiannis Antoniou said the Republic’s authorities had been aware of the development and that flights to and from Larnaca airport from Israel had been continuing as normal.

Cyprus has seen significant rise in foreign property purchases in recent years, with more than 37,000 properties sold to foreign buyers between 2021 and the end of 2024.Buyers from the United Kingdom lead purchases followed by Russians, Israelis, Greeks, and Lebanese.

Meanwhile, Cypriots have purchased more than 200,000 properties during the same period. 

Politis hosted an interview with the President of the Cyprus Association of Research and Innovation Enterprises (Tasos Kounoudes) that stated that Cyprus remains perhaps the only country that, unfortunately, continues to sign arms contracts with zero substantive participation of the domestic defense industry. Over the last 35 years, Cypriot taxpayers have contributed over 9.5 billion euros to defense without the manufacture of a single Cypriot component. Technologies and capabilities of Cypriot companies are fully utilized by the European defense industry, penetrate foreign markets but do not have access to the domestic market.

The highway connecting Paphos and Polis Chrysochous will be complete by either 2030 or 2032 Transport Minister Alexis Vafeades said. A tender for the completion of the project’s first phase, where construction had begun but was cut off after the government cancelled a contract with Greek construction company Intrakat, will be held in the summer, with the hope of having a new contractor in place by September.

Then, he said, the first phase of the project should be completed within the next three years, while a tender for the second phase of the project is set to be opened in February next year.

The Latchi port will be expanded in a €50 million upgrade project, Transport Minister Alexis Vafeades announced.

He said the Cyprus Ports Authority project aims to enhance maritime and land infrastructure at the port, which serves as a key gateway to the Akamas peninsula and a departure point for leisure boats and coastal cruises.

The Public Service Commission suspended three employees from the forestry department following receipt of a letter from the agriculture minister in connection with possible criminal offences related to the purchase of aerial firefighting equipment.

Philenews reported that Cypriot businesses and businesses in the European Union in general made a small jump in the use of artificial intelligence (AI) in 2024.

In the EU, 13.5% of businesses with 10 or more employees used AI in their activities last year compared to 8% in 2023, marking an increase of 5.5 percentage points.

In Cyprus, the corresponding percentage increased to 7.90% in 2024 from 4.67% in 2023, i.e. by 3.23 percentage points, but the rate of increase is lower compared to the EU.

24/01/25

ENERGY/ECONOMIC NEWS

The President and Director General of the Cyprus Chamber of Commerce and Industry had a working visit to Israel.

During a dinner hosted by Avi Balashnikov, Chairman of the Israel Export Institute, ways to expand cooperation between the two Organizations were discussed.

A meeting was also held at the Federation of Israeli Chambers of Commerce (FICC) discussion on further promoting their collaboration.

The dinner and meeting was also attended by the Cypriot Ambassador Kornelios Korneliou and the Head of Commercial Affairs at the Embassy, Sofronis Papageorgiou.

Turkey’s defence ministry said Cyprus’s Navtex notice for Block 5 lies outside Turkish maritime jurisdiction, while confirming it is closely monitoring activities in the area, Turkish media reported. 

The Cyprus Ports Authority (CPA) has submitted a proposal for EU co-financing to expand the Vasiliko port into a new industrial harbour under its management. The €350 million expansion project aims to increase the port’s capacity to 1,772 vessels annually. The CPA has requested €38.5 million in co-financing for Phase A of the project, which has a total budget of €85 million. 

The government, sometime over the next few weeks, will unveil a ‘strategic plan’ for attracting foreign investment to Cyprus while also asking local businesspeople and industrialists for their feedback on how to render the economy more competitive. Energy, Commerce and Industry Minister George Papanastasiou said the government will set up an umbrella organisation hosting the various agencies that process applications – on a fast-track basis –from foreign investors. The drafting of a policy document, along with an action plan to make Cypriot businesses more competitive and export oriented is also planned. 

Cyprus’s real estate market maintained previous year’s levels in 2024 (1.8% increase in property transfers from last year).  

The total value of transfers decreased by 2.3%. Limassol remained the market leader, despite losses.

Philenews reported that Makariou Avenue in the center of Nicosia is getting its own 168-bed hotel owned by the Fattal Group.

The Paphos District Organisation has called for urgent construction of two new dams at Diarizos and Ezousa rivers, as the district faces mounting water supply challenges.

Kathimerini reported that BYD (Build Your Dreams) is feverishly preparing for its arrival in Cyprus in the Spring. The Chinese multinational company BYD is known for the manufacture of electric vehicles and considered Tesla’s main “rival” in electric mobility. It is expected to simultaneously open showrooms in Nicosia and Limassol. BYD is represented by the Sfakianakis Group of Greece.

Athens will soon be the site of the Doers Summit 2025, an event highlighting the rising stars of Europe’s startup ecosystem. It is organised by the team behind Reflect Festival, based in Cyprus.

In 2023, 16.9 per cent of Cypriots reported difficulties in heating their homes. This marks a 2.3 per cent improvement compared to 2022, when one in five Cypriots struggled to keep their homes warm.

Across the European Union, the situation has worsened, with an average of 10.6 per cent of the population facing heating challenges in 2023, up by 1.3 per cent from the previous year.

22/01/25

ENERGY/ECONOMIC NEWS

Foreign experts have concluded their report on the FSRU (Floating Storage and Regasification Unit), a milestone in slashing electricity prices in Cyprus, government spokesman Konstantinos Letymbiotis said.

The report outlines the actions that need to be carried out for the ship to obtain the necessary FSRU certification and operate in an efficient and safe manner.

He added that “the next phase includes expressing interest, which [natural gas infrastructure company] Etyfa will proceed with to complete the certification of the ship.

The government is, he said, also in the final stages of awarding the contract for a project manager for the completion of the works on the terminal at Vasiliko.

Politis reported that Trump’s policies, particularly in the energy and trade sectors, are expected to have a significant impact on the European and, by extension, the Cypriot economy. A significant reduction in energy prices could dramatically change things for Cyprus’ energy program. The rise in prices is what has rekindled interest in Cypriot deposits. On the other hand, lower energy prices could reducing costs for businesses and households. Furthermore, Trump’s policy on renewable energy sources, including the elimination of subsidies, could negatively affect European green energy companies. This could have indirect effects on Cyprus, as the country is committed to the green transition of the economy.

According to an economist (Tasos Yiasemidis) the imposition of tariffs on imports from the European Union could have a significant impact on the European economy. For Cyprus, the impacts are expected to be indirect, but significant:

• Reduced exports. Although Cyprus does not have significant direct exports to the US, reduced European exports could affect the Cypriot economy through its trade relations with other European countries.
• Inflationary pressures. The tariffs are expected to lead to higher prices, which could affect the cost of living in Cyprus.

The imposition of tariffs on products from Mexico and Canada is a development also that may indirectly affect Cyprus through its relations with the European Union. The tariffs may affect the economies of Germany and France, which will also have indirect effects on Cyprus.

Despite the challenges, there are also potential opportunities for Cyprus such as:

• A benefit from increased flows of US investment, particularly in the energy, technology and renewable energy sectors.
• Cyprus’s geostrategic position could make it an important energy hub, particularly if the US seeks to increase its influence in the region.
• The need to adapt to new conditions could lead to further diversification of the Cypriot economy, strengthening sectors such as financial services and technology.

The occupied north’s energy supply may be in peril after a boat carrying fuel oil to power its power stations was seized by the Turkish authorities as part of a large-scale investigation into a corruption scandal.

Cyprus saw inflation accelerate to 2.6 percent in December from 1.5 percent in November, driven largely by rising food prices and hospitality costs.

INBnews reported that Cyprus-based investment fund 33East announces the establishment of a seed fund with an initial capital of €26 million. The fund will invest in startups with a Cyprus connection. It will provide financing, support and networking with the aim of helping Cyprus transition into a hub of innovation and entrepreneurship. 33East is the first venture capital fund in Cyprus to receive support from the European Investment Fund, the Cypriot Government through the national Recovery and Resilience Fund, the Bank of Cyprus and other local investors.

The European Banking Authority (EBA), in coordination with the European Systemic Risk Board, has released macroeconomic scenarios to assess the resilience of banks in Cyprus.

The scenarios, which include baseline and adverse projections, aim to evaluate the financial sector’s ability to withstand negative economic and financial shocks while identifying systemic risks.

Under the baseline scenario, Cyprus’ economy is projected to grow by 3 per cent in 2025, 3.1 per cent in 2026, and 3 per cent in 2027.

Conversely, the adverse scenario foresees a contraction of 2.5 per cent in 2025, followed by a steeper decline of 4.7 per cent in 2026, before a modest recovery of 0.7 per cent in 2027.

Growth for 2024 is estimated at 3.7 per cent, based on historical data.

Almost 60% of CEOs surveyed by PwC around the world expect economic growth to increase over the next 12 months, despite geopolitical risks and inflation, while a growing number say they plan to hire more and invest further in GenAI.

21/01/25

ENERGY/ECONOMIC NEWS

Politis reported that ExxonMobil and Qatar Energy are in full preparation, with the rig preparing to take position above the target at the “Electra” field in block 5. The indications are encouraging, while according to information, the company’s own estimates speak of potential reserves of 10-30 trillion cubic feet (tcf) of natural gas. If the field is found on the upper side of the target, then the optimistic scenario of 30 tcf will be verified, classifying the field in the Cypriot EEZ as one of the largest fields in the Eastern Mediterranean. However, if the deposit is limited to the lower levels of the target, the amount of natural gas will fluctuate around 10 tcf, a reserve that nevertheless remains strategically and economically important.

ExxonMobil is expected to provide a first estimate of the size of the deposit, in late March to early April.

The potential loss of 1.3 million cubic metres of water from a dam in Pafos remains a real threat following a leak detected.

So far, around 200-250 thousand cubic meters of water have been lost. Meanwhile, a tender for a mobile water desalination unit in Paphos is expected to be announced soon.

Plans for four mobile desalination units are underway, with three designated for Limassol and one for Paphos.

In addition to the mobile units, two new fixed desalination plants are planned for the next 3–4 years, along with expansions to existing facilities.

By the end of the year, a private investor should take over the management of the Cyprus Stock Exchange (CSE).

During a discussion of the CSE budget in the parliamentary Finance Committee, the chairman of the board of directors, Marinos Christodoulides, stated that by February, Parliament should approve the bill for the privatization of the CSE.

DISY MP Haris Georgiadis expressed his concern that by the end of the year the CSE will need financial support.

20/01/25

ENERGY NEWS

Cyprus issued a Navtex on Sunday  (until June 19, 2025) in relation to the start of drilling at the ‘Electra’ field, in bloc 5 of the Cypriot exclusive economic zone (EEZ).

Block 5 is a joint venture of ExxonMobil with Qatar Energy.

As regards the start of drilling, Energy Minister George Papanastasiou said that this depends on the positioning of the drilling rig.

The drilling results are expected to be known at the end of February, while an official announcement will be made at the end of March, following an evaluation, on the quantities of the deposit.

Politis reported that according to Greek International Relations professor Costas Ifantis, Turkey and Syria can legally delimit EEZs, as they are countries that have adjacent coasts. However, the big issue with this particular case is that according to International Law, it should not ignore the sovereign rights of the Republic of Cyprus. Ifantis argues that “the ideal from the point of view of International Law would be a tripartite discussion and demarcation between Turkey, Syria, Cyprus”. A move that he estimates will not happen from the side of Ankara, since it does not recognize the Republic of Cyprus. “If despite this, Syria, which recognizes the Republic of Cyprus, proceeds with such a thing, then a big issue will be created as the new regime is not authorized to proceed with such international agreements. The Cypriot government could approach the new regime and ask that, in the event that such discussions begin with Turkey, it participates as well or ask to delimit the part that is directly related to it with Syria”.

Energy analyst Charles Ellinas in an op-ed notes that control of East Med gas is in the hands of the oil & gas companies. Regional governments can try to influence them, but cannot tell them what to do. Nothing will happen without their agreement. And their priorities are driven by commercial factors. Cyprus has discovered more than 400bcm of natural gas, but developing it is proving to be a challenge.

2025 will continue to face serious challenges in terms of energy. Cyprus should prioritise the completion of natural gas imports at Vasiliko that has the potential to reduce the price of electricity.

He also comments on Egypt’s challenging economic & dire gas situation

Philenews reported that the administrative court has rejected a legal challenge by PEC (private electricity power producer) against the energy regulator’s (CERA’s) decision to license a sixth power generation unit at Vasiliko by the Electricity Authority of Cyprus (EAC).

The court ruled that PEC, owned by the Cyfield Group, failed to demonstrate legitimate interest in contesting CERA’s decision, finding insufficient evidence that the company would suffer harm from EAC’s new unit.

ECONOMIC NEWS

The transfer of the temporary management of the Larnaca Marina to the Cyprus Maritime and Maritime Institute (CMMI) of the Larnaca Municipality has been finalized.

At a meeting at the Ministry of Transport, the basic parameters of the management were determined, as well as the next steps that will lead to the signing of an agreement within 2025.

According to information, the CMMI center of excellence will take over the management of the Larnaca Marina, with the state responsible for revenues and expenses. As decided, CMMI will deliver a business plan for the management of the marina in one to one and a half months followed by the remaining details & actions.

Politis reported that Cypriot businesses, especially in the construction sector, could get involved and help in the reconstruction efforts in Syria, according to Cyprus’ business associations, while political analysts are divided on whether Cyprus could play an active role in the developments. “The scale of the disaster is enormous, which is why the reconstruction of the country is expected to take a long time and require funds estimated at between 250-400 billion dollars,” said Anna Koukkidis-Prokopiou. “Amidst this complex landscape of geopolitical interests, it is currently difficult for Cyprus to play any role, since there is no official line of communication with the new Syrian government or tangible involvement in what is happening on the ground,”.

Cyprus hit a historic milestone in tourism as visitor arrivals surpassed 4 million for the first time, reaching 4,040,200 in 2024.

The figure represents a 5.1% increase from 3,845,652 arrivals in 2023, surpassing the previous record of 3,976,777 set in 2019.

The United Kingdom remained the largest source market in December, accounting for 23.7% of arrivals with 31,501 visitors, followed by Israel at 17.4% (23,168), Poland at 9.4% (12,473), Greece at 9% (11,969), and Germany at 5.7% (7,535).

Eurobank has completed the sale of its 8.58% stake in Demetra Holdings Plc to Logicom Services Limited for approximately €27 million. The transaction is part of a broader agreement between Eurobank, Demetra, and Logicom that includes a second phase where Eurobank will acquire an additional 24.66% stake in Hellenic Bank Public Company Ltd

Transport minister Alexis Vafeades inaugurated the country’s first aircraft engine maintenance facility. The facility is operated by United Aerospace Maintenance Company (UAMCO) & represents one of Cyprus’s largest technology investments. US Ambassador Julie Fisher described it as “an incredible moment” for US-Cyprus commercial ties. The minister also said there is significant development potential for the former Larnaca airport site, stating the government wants to avoid letting the property remain unused for longer.

Media reported that according to information, regardless of the decision of an Athens Court for the temporary ban on the payment of 2 guarantees regarding the Paphos-Polis Chrysochous project, the Republic of Cyprus has the binding decision of the Paphos District Court for the disbursement of one Guarantee and the pending case for the disbursement of another. All relevant decisions, sources report, are handled by the Legal Service. Kathimerini reported also that the budget for the design and construction of the project has risen by €10 million, with the total cost now estimated at approximately €95 million. The project, which is expected to be completed within three years, has faced numerous delays and challenges. According to information, the state plans to recover part of the additional cost from the original Greek contractor, Intrakat.

Philenews reported that almost the entire business community of Cyprus will be in Athens, with the aim of informing Greek businessmen about the Cypriot economy and the opportunities arising from the cooperation between the two countries.

The business delegation will be led by the Minister of Finance, Makis Keravnos and the President of the Cyprus Chamber of Commerce & Industry.

The occupied north’s Minimum Wage Determination Commission has set the first minimum wage of 2025 at 43,469 TL (€1,194.53) gross (37,818 TL net – €1,039.24) per month. Trade union leaders and opposition figures in the north expressed fury at the new minimum wage.

The Republic of Cyprus’s national minimum wage is set to €1000 gross (€195 lower than the occupied north’s) which translates to €885 net (€154 lower than the occupied north’s).

A state-of-the-art medical facility, American Medical Centre Limassol / American Heart Institute, has received environmental approval for construction in central Limassol. The €60-million project will operate outside Cyprus’s national health system (GeSY) and is expected to become one of the region’s largest and most technologically advanced private hospitals.

17/01/25

ENERGY/ECONOMIC NEWS

An editorial in Politis notes the importance of the ceasefire for both the Middle East and Cyprus. Other than the political angle,  economically, the deal would benefit Cyprus by boosting tourism, especially from Israel and improve foreign investments, particularly in the real estate sector. In energy, it will facilitate the implementation of Cyprus significant energy plans with Israel, strengthening the position of Cyprus as an energy hub.

On February 6, 2025, the Saudi x Cyprus Matchmaking Event will take place in Saudi Arabia.

The initiative is organized by the Ministry of Communications of Saudi Arabia and the Digital Cooperation Organization, in collaboration with the Cyprus Chamber of Commerce and Industry, the Research and Innovation Foundation, Invest

Cyprus and the Cyprus Saudi Arabia Business Association. The aim of the event is to support technology companies in Cyprus and Saudi Arabia & strengthen their cooperation,

The outlook for Cyprus tourism in 2025 is encouraging, with booking flows surpassing those of the previous year, according to president of the Cyprus Hoteliers Association (Pasyxe) Thanos Michaelides.

A broad meeting under the President of the Republic, on the possibility of attracting quality investments to Cyprus, was held on the 16/01/25. A meeting was also held on the topic of encouraging the return of Cypriots who work abroad and are distinguished for their scientific and professional skills.

Central Bank of Cyprus (CBC) Governor Christodoulos Patsalides said that cyber risk and data security are by far the biggest threat for banks right now, which he said must adapt quickly to identify and address evolving challenges effectively.

Rating agency DBRS released a report projecting robust GDP growth for Cyprus over the coming years.

The agency explained that its projections are based on a positive trend in unemployment and Cyprus’ strong fiscal performance in recent years, despite challenges in the country’s service-based economy.

The criminal case against former Transport Minister Marios Demetriades in relation to “suspicious” naturalisations of new Cypriot citizens under Cyprus’ citizenship through investment scheme, commonly known as the ‘golden passport’ scheme, was adjourned until March.

Demetriades and nine other defendants, seven natural persons and two legal entities, will now appear in court on March 18 to be informed of the charges they face.

In total, they face 59 charges, related to bribery, extortion, conspiracy to defraud and corruption.

Eurobank aims in establishing an office in Israel. 

The Research and Innovation Foundation (RIF) has announced a consultation for a new funding scheme (€10 million) to support Cypriot companies setting up facilities for innovative product manufacturing.

It will provide funding across three sectors: digital and deep technology innovation, clean and resource efficient technologies, and biotechnologies.

16/01/25

ENERGY/ECONOMIC NEWS

Left-wing AKEL Secretary General Stefanos Stefanou has written a letter to the President requesting information and transparency regarding the Great Sea Interconnector project between Cyprus and Greece.

“It is imperative that we are informed about the due diligence study and the content of all agreements made so far”.

The letter asks for clarification regarding commitments made to ADMIE for participation, the conditions set by Cyprus to safeguard the good of consumers, if the Ministry of Finance has reservations for the costs, etc.

He also expresses concerns as “the various and often contradictory information and statements reinforce uncertainty and constantly raise many questions”.

Philenews reported that a new article on a Greek website reports a standstill in the research carried out by an Italian ship on the seabed between Crete and Cyprus, for the needs of the electrical interconnection.

The standstill is apparently attributed to Turkey’s objections to specific areas that it considers to fall within its own continental shelf, based on the so-called Turkish-Lybian memorandum.

During a video conference between the European Commission, ADMIE & the Regulatory Authorities of Cyprus and Greece, ADMIE reiterated that the ship’s departure for research is pending and they are unable to determine the time of issuance of a Navtex.

It is estimated that things will remain stagnant at least until a new meeting between the heads of states of Greece and Turkey, scheduled for next month.

The first of the three projects announced by the Government for the Larnaca Marina has officially entered into implementation, following the termination of the contract with the former contractor.

The Minister of Transport, Alexis Vafeadis, announced that €1.5 million has been approved for dredging and renovation works.

Cyprus has been authorised to buy military hardware directly from the United States government after joining three programmes run by the department of defence. Previously, it could only buy US military hardware from private companies and the authorization will allow the purchase of weapons and other hardware at cheaper prices.

As part of the government’s program to support the domestic defense industry, the Council of Ministers approved the establishment of the Cyprus Defense Industry Council (CDIC) and appointed its members. The Minister of Defense, Vasilis Palmas, is the President of the Council.

The Cyprus Chamber of Commerce and Industry has appointed Emilios Michael and Andreas Andreou as its new deputy secretary generals.

Media reported that Spain’s decision to impose steep taxes on non-EU property investors using platforms like Airbnb has sparked debate over whether countries like Cyprus and Greece will benefit from the shift in demand.

Pavlos Loizou, CEO of real estate analytics firm Ask Wire, questioned whether these measures will actually be enacted and, if so, how thorough their implementation will be.

“Yes, some prospective property buyers may come to Cyprus or Greece but it will not change things dramatically,” he said.

15/01/25

ENERGY/ECONOMIC NEWS

The Natural Gas Infrastructure Company (ETYFA) will proceed with bids for the next destination of the floating natural gas unit according to the Minister of Energy George Papanastasiou.

The ship will remain in Malaysia for another 2-3 months so that the necessary changes can be made.

Asked about the Great Sea Interconnector (GSI) issue, he said a letter sent to the Greek Ministry of Energy on December 3, has not been answered yet.

Because the issues that emerged through the study of the firm hired by the Republic of Cyprus were many, time is needed.

He expressed the hope that the response will be in the direction that will be sustainable for the Republic of Cyprus to make the decision to be a shareholder.

At the same time, he added that the project is progressing normally.

Energypress.gr reported that government officials in Athens and Nicosia have been saying that it was only a matter of time before a navtex was issued for the carrying out of oceanographic surveys in international waters by an Italian company for the purposes of the Cyprus-Crete electrical interconnection. But no navtex was issued nor were the surveys of the IEVOLI RELUME (or any other vessel) extended to international waters.

Diplomatic efforts to overcome the problems that prevent the expansion of marine surveys have not yet yielded results.

Media reported that the Minister of Agriculture, Rural Development and Environment Maria Panayiotou stated the state is next to the farmers and moving forward with actions that lead to a sustainable, resilient and modern agriculture that respects the environment.

She was addressing a conference on “Information Technologies for a Smart Agriculture, Experiences and Good Practices of their Implementation from Greece and Israel” at the Cyprus Institute that included the participation & a presentation by Tal Maor (agtech expert).

INBnews hosted an interview with Shaul Keinan, one of the founders of Premium Access Group (together with Evgeni Leibovich), the company developing the Palm Beach resort & an associated residential project in Larnaca. The investment is expected to exceed 100 million euros and he refers to the advantages of Cyprus and their aim to place Larnaca on the map of the top Mediterranean destinations.

The chairman of the Association of Large Investment Projects, emphasised the critical role of foreign investment in Cyprus’ development

The total value of non-performing exposures (NPEs) in Cyprus dropped to €1.6 billion by the end of September 2024.

This decrease brought the NPE ratio to 6.5 per cent of total loans.

Energy Minister George Papanastasiou urged the House commerce committee to pass a bill which would set maximum prices for bottled water at some points of sale.

14/01/25

ECONOMIC NEWS

The trial of Simon Mistriel Aykut, charged with the land appropriation of Greek Cypriot land in the Turkish-occupied areas of Famagusta and Kyrenia, has been postponed until January 27 to allow defence preparations. Aykut faces 242 charges related to the appropriation of 60 land plots belonging to Greek Cypriots, including fraud, illegal possession and use of property, conspiracy to defraud, and money laundering involving 43.5 million euros.

With an  announcement criticizing the Government, DIKO MP in Larnaca, Christos Orphanides, announced his resignation from the ad hoc committee monitoring the development process of the city’s port and marina. He strongly criticizes the Cyprus-Greece interstate agreement and the assignment of the study to the Greek Port Planning Authority, even referring to the “numerous scandals” that burden this authority.

Cyprus could up its spending cap if it convinces Brussels that the models it uses systematically ‘downgrade’ the island’s economic indices, the head of the Fiscal Council said. This in turn affects the expenditures for Cyprus allocated at the EU level.

The Fiscal Council ran a statistical analysis which showed Brussels’ model produces a divergence of approximately 1 per cent lower compared to the other models. This impacts – downward – the spending cap assigned to Cyprus.

House prices in Cyprus are on the rise again, recording a 2.7% increase in the third quarter of 2024 compared to the same period in 2023. This marks the 11th consecutive quarter of annual growth in the property market.

Ready-mix concrete companies in Cyprus are set to increase their prices by 5 percent from January 2025, passing on costs from a recent wage settlement to consumers following a prolonged workers’ strike. Labour Minister Yiannis Panayiotou has denounced the increase in prices.

Pyrgou Vakis LLC and Prountzos & Prountzos LLC (belonging to the current mayor of Nicosia) have announced a strategic merger, effective from 1 January 2025.

The merged entity will operate under the name Pyrgou Vakis LLC, uniting two leading law.

13/01/25

ENERGY NEWS

Sigmalive reported about threats against Cyprus and the reinstatement of Erdogan’s proposal for a Regional Conference for the delimitation of Maritime zones with the participation of the pseudo-state in the occupied North, are included in the letter of the occupying regime that the Turkish Permanent Mission submitted to the UN, on the occasion of the new drilling program in the Cypriot EEZ.

A Cyprus Mail op-ed notes that trilateral meetings produce little more than declarations. They produced a lot of words about energy cooperation but almost nothing that was tangible. The East Med pipeline, which was being discussed with Israel was non-viable. And the dispute over the Aphrodite gas field has still not been resolved. Things were no different in the trilateral alliance with Egypt and the East Mediterranean Gas Forum (EMGF) turned out to be little more than a talking shop. Governments may create a framework for cooperation but it is up to individuals and companies to undertake joint ventures and engage in business activities. 

Politis reported that Egypt supports the Cypriot positions in the region, which has made the cooperation between the two countries of strategic importance.

Cyprus and Egypt are on track to reach an agreement for the exploitation of Cypriot natural gas, focusing on the Cypriot fields of Kronos and Aphrodite, while the necessary timetables have also been set.

Well-informed sources note that Egypt invites Cyprus to channel its natural gas to Egyptian infrastructure, either to meet the needs of Egypt’s internal market or to liquefy Cypriot natural gas in Egyptian infrastructure and export it (via Egypt) to international markets.

Philenews also reported about the possibility of exporting Cypriot gas to Egypt.

Plans to install two flexible power generation units (meant to add 80 megawatts of capacity) at Dhekelia power station by summer 2025 are likely to miss their deadline, putting Cyprus’ electricity supply security at risk. According to Philenews sources, the Electricity Authority of Cyprus (EAC) has not yet decided on accepting any of the tender proposals received. Additionally, the government awaits European Commission approval regarding potential state funding. The project’s cost has exceeded initial estimates of €80-90 million, sources say, forcing EAC to reassess the situation. The delay compounds existing power supply concerns, as neither the newly installed sixth unit at Vasilikos (160 megawatts) nor PEC’s units (260 megawatts) can operate without natural gas, which won’t be available in 2025.

Philenews reported that representatives of at least two interested companies that want to invest in floating wind farms were recently in Cyprus. According to a competent source at the Ministry of Energy, meetings were held but discussions and potential plans are at an early stage.

Andreas Poullikkas, former Chairman of the Cyprus Energy Regulatory Authority, is now a Professor of Energy Systems in the Department of Mechanical Engineering at the School of Engineering at Frederick University.

ECONOMIC NEWS

Discussions are underway to potentially create direct transport links between the occupied north and Syria, ‘transport minister’ Erhan Arikli said.

He said he had spoken about the possibility with Turkish Foreign Minister Hakan. In particular, he said, efforts would be made to create a ferry service between Famagusta and the Syrian coastal city of Lattakia.

Left-wing Dialogos reported that the President believes that the Ports Authority is not in a position to undertake the development of the port of Larnaca. The privatization of the port is the prevailing scenario despite the fact that the message that came out publicly from the meeting held last week was that the decision for temporary private managers of the port and marina was prevented. In reality, the government’s position is that the development and operation of the port on a permanent basis should be entrusted to private parties. The Hellenic Republic Asset Development Fund (TAIPED), which is undertaking to draft a study to determine the best development approach for the port and marina, means one thing: privatization of the port.

A Cyprus Mail op-ed noted that the Larnaca port & marina project should be owned entirely by the public sector and operated by both semi-government entities and the private sector.

Two Cyprus-based companies are included in the list of new sanctions imposed by the US against individuals and entities related to Russia’s energy sector, “the main source of revenue fueling Russia’s war against Ukraine”.

Hermes Airports hosted a conference titled focusing on transforming Cyprus into a year-round tourist destination. President Christodoulides said 2024 was a record year for tourism, as Cyprus broke the 4 million tourist barrier and recorded a revenue of around €3 billion, which contributed 13.5 per cent to the country’s GDP. He also linked foreign policy to tourism noting it is important to have strong ties with all neighbouring countries, which are a source of tourism. Referring to Israel he noted that political cooperation has addressed the tendency of Israeli tourists to visit the north.

Philenews reported that a dispute between the Department of Forests and Cyfield contractor over improvements to the Akamas National Forest Park’s main road network has resulted in a €1.2 million loss for the Republic of Cyprus.

Sources say the Forestry Department made a legal error by requesting guarantee renewals from the contractor without simultaneously approaching the bank to liquidate the bonds in case of non-renewal.

According to the company terminated the contract on December 23, 2024, following the department’s written request dated June 6, 2024.

Total vehicle registrations in Cyprus increased by 9.1 percent to 49,616 in 2024 compared with 45,494 in 2023, with electric vehicles reaching a 4.0 percent market share, up from 2.7 percent in 2023.

Hybrid vehicles saw significant growth, accounting for 37.1 percent of registrations in 2024

The Cyprus Shipping Chamber has announced the appointment of Alexandros Iosifidis as the new General Manager. He will succeed Thomas Kazakos, who will assume the duties of Secretary General of the International Chamber of Shipping in London from 1 April 2025.

10/01/25

President Christodoulides met yesterday with Israeli President Isaac Herzog in Nicosia to discuss developments in Syria and other regional matters.

ENERGY/ECONOMIC NEWS

The Cyprus News Agency reported that the Cypriot government is expected to approve Chevron’s development and production plan for the Aphrodite gas field within a month, as final legal details are being reviewed, sources said.

The revised proposal includes a floating production unit and a shorter pipeline route to Egypt than previously suggested, with a landing point at Port Said’s existing gas infrastructure on Egypt’s eastern coast.

The new landing location represents a significant change from Chevron’s earlier proposal, which had planned for the pipeline to reach further west along the Egyptian coast.

Sources say the adjusted route will reduce both costs and implementation time while maintaining Cyprus’s preferred floating production facility at the Aphrodite field.

Delivery of a technical report on the state of the floating, storage and regasification unit (Fsru) is expected “any day now”, the chairman of the natural gas infrastructure company said.

The vessel is currently anchored in Malaysia undergoing a technical inspection to determine what equipment and/or upgrades are necessary for it to be able to regasify liquefied natural gas.

It additionally needs to be certified as a storage and regasification unit. To do that, it must dock at an operational terminal to be tested. Since the LNG terminal at Vasiliko in Cyprus is incomplete, the ship will have to dock elsewhere.

Once authorities in Cyprus review the technical report – done by a foreign consultancy firm – they will know what upgrades are necessary for the Fsru and estimate how long it would take to implement them.

At the same time they will be looking for the next port of call for the ship – a terminal where it can be hooked up to test it as a regasification unit & receive its last pending certification – as a regasification unit.

It has already been certified as an LNG carrier.

Currently, according to the same information, “the final legal positions and finishing touches” are being made on the plan submitted by the American energy giant, which appears to be “in the right direction”.

The Cairo business conference held alongside the trilateral summit, highlighted economic ties and a shared vision for the region, according to the Cyprus Chamber of Commerce.

Discussions focused on cooperation in the energy, trade, tourism, technology, and infrastructure sectors.

The three business chambers signed a Memorandum of Understanding (MoU) establishing a trilateral council.

Philenews reported of developments regarding the Technological Park in Pentakomo with serious interest expressed by American, Chinese, Indian and Israeli investors who want to undertake the project. The meetings and discussions with interested investors are taking place pending the submission to the Limassol Chamber of Commerce of the draft documents regarding the new tender to find a strategic investor by the Ministry of Commerce. The tender may be announced before the summer.

Cyprus is set to intensify its appeal to Chinese tourists, aiming to secure a greater share of one of the world’s largest outbound travel markets, Deputy Minister of Tourism Kostas Koumis said.

The statements followed a strategic dialogue with a visiting delegation from Shanghai.

Cyprus has dropped two positions in the latest Henley & Partners Passport Index. The Cypriot passport is now ranked 14th globally in 2025, down from its 12th-place position in 2024. The index evaluates 199 passports based on their access to 227 destinations worldwide.

Cyprus’ shopping malls reported record-breaking performance in 2024, with December emerging as a standout month for both footfall and sales.

Cyfield Construction expressed his willingness to reach a settlement to continue work on upgrades to Akamas’ road network, despite the current suspension and contract termination issues.

09/01/25

ENERGY/ECONOMIC NEWS

Energy cooperation was a main topic of discussion at the 10th Trilateral Greece–Egypt–Cyprus Summit held in Cairo yesterday. Greek PM Mitsotakis spotlighted the “GREGY” Interconnector aimed at linking Greece and Egypt and facilitating the transfer of clean energy from North Africa to Europe. Trilateral & bilateral MOUs were also signed.

Politis reported that the progress of the Great Sea Interconnector (GSI) project is expected to be examined in a teleconference on January 15, with the participation of representatives of the European Commission. Cyprus has not yet taken an investment decision on the project and there are still regulatory issues pending. The participation of the French fund Meridiam, which appears ready to finance the project by acquiring 49% of the project, has not been officially confirmed, but has not been denied either.

The Electricity Authority of Cyprus (EAC) will begin installing smart meters this January, aiming to replace 500,000 conventional meters with smart ones by 2028.

Cyprus banks continued to offer higher-than-average lending rates and below-average deposit rates in November, widening the gap with other eurozone countries, according to European Central Bank data.

The interest rate for household deposits up to one year in Cyprus fell to 1.70%, placing the country second-lowest in the eurozone. The eurozone average stands at 2.61%.

Corporate deposit rates in Cyprus also declined to 1.99%, ranking lowest in the eurozone where the average rate is 2.90%.

On the lending side, mortgage rates in Cyprus decreased to 4.50%, remaining above the eurozone average of 4.27%.

The Deputy Ministry of Tourism has set a January 25 deadline for stakeholders to submit suggestions regarding the Paphos Marina project.

The ministry will invite expressions of interest after the consultation period ends, followed by a pre-selection process for consortia meeting the project requirements before proceeding to the tender stage.

08/01/25

ENERGY/ECONOMIC NEWS

By the end of 2025, all infrastructure in Vasiliko is expected to be completed, while the floating natural gas unit (FSRU) should be at the pier ready for use, according to the Minister of Energy, Trade and Industry, Giorgos Papanastasiou. Natural gas is expected to be imported in the first quarter of 2026 for testing by the EAC and private power producers. The FSRU is in Malaysia, where inspections and adjustments are ongoing to ensure its functionality as a floating gasification unit.

In relation to the Great Sea Interconnector (GSI), the Minister stated that Cyprus is awaiting a written response from the Greek Minister of Environment and Energy regarding the country’s participation in the share capital of the project. At a meeting held on 27 December, the ownership and management of the infrastructure were discussed. The final decisions will be based on the proposals of ADMIE Greece, which is implementing the project.

Regarding the “Kronos” field, which is expected to offer the first Cypriot natural gas, the development and production plan for the field is expected to be submitted within two months. The transportation of the natural gas is planned through the Zor infrastructure in Egypt, with part of it intended for the domestic market and the rest for liquefaction and export to international markets.

Reducing electricity costs for households and businesses remains a key priority for the government, Energy Minister George Papanastasiou said at an event to mark the launch of the third trial period for a competitive electricity market.

The start of the trial period is a pivotal phase in the transition towards a liberalised electricity market The plan is to have a fully operational competitive electricity market by July 2025.

 A Greece-Cyprus-Egypt trilateral meeting of head of States will be held today in Cairo. Energy issues such as the Greece-Egypt GREGY electrical interconnection project and the possibility of a Turkish-Syrian maritime demarcation agreement ( that Cyprus & Greece strongly oppose) will be discussed.

During a meeting today at the Presidential Palace between the President and the Larnaca Development Committee, important decisions were taken. As far as the port is concerned, it was decided that at least for the next six months, management will remain with the Cyprus Ports Authority, while management of the marina will be assigned to the Cyprus Marine & Maritime center of excellence, as was the wish of the Larnaca authorities. An intergovernmental agreement will be made with Greece so that the Hellenic Republic Asset Development Fund will be assigned the study for the future of the port, marina and land area in Larnaca. Foreign experts will not be needed and it will also save time.

The aim is to complete the study within six months.

Cyprus launched its fifth telecommunications satellite by Overhorizon, a company with Swedish ties. The ministry for Research, Innovation and Digital Policy is focusing on attracting more investment into the satellite communications sector.

The occupied north’s ‘agriculture ministry’ announced its intention to import “high value sheep” from abroad with the aim of being able to bolster halloumi production in the face of increasing demand.

Asked whether the imported sheep would be used to produce halloumi which will be exported to the European Union as part of Cyprus’ protected designation of origin (PDO) status, the ‘ministry’ said that as per the regulations, the sheep themselves would not be able to be used for this purpose, but their offspring will.

7/1/25

ENERGY NEWS

GREAT SEA INTERCONNECTOR

Philenews reported on the 25/12/24 that the Government has sent, through the Minister of Energy, George Papanastasiou, a clear message that the draft Concession Agreement (for the electricity interconnection from ADMIE to the Great Sea Interconnector (GSI) is not acceptable. And the Republic of Cyprus is not going to invest in GSI. It has also conveyed at a high level that serious changes must be made, as indicated by the American law firm which is acting as advisor to the state. There seem to be two trends within the Government.  One is followed by the Presidency and the Ministry of Energy, which consider that the issue of the country’s participation in GSI has not definitively closed. The second trend is from the Ministry of Finance which from the beginning did not see the overall project with a positive eye and questions its benefits. It also feels vindicated by the recent study which confirms its reservations. According to info., for the time being the Presidency adopts the position of the Ministry of Energy while the negative attitude of the Ministry of Finance could be changed if the European Investment Bank approved the request by ADMIE for a loan of approximately 500 million euros. There are opposing views about the project within the private sector as well.

On the 28/12/24 a meeting was held in Athens about the project (GSI) and the observations of the Cypriot advisors on the possibility of the Republic being a shareholder were discussed. The Cypriot government is now waiting for the official position of the Greek Ministry of Energy to a letter sent by George Papanastasiou (two weeks ago) which contained the observations of advisors to the Cypriot government. The Greek government’s response to the letter will be crucial for Nicosia to make a relevant decision.

The Audit Office confirmed on the 31/12/24 that it has alerted the European Public Prosecutor’s Office (EPPO) over potentially suspicious financial dealings relating to the Interconnector project. The Audit Office will formally address a communiqué to the EPPO by the end of January while around the same time, it will also release a special report on the matter. The audit covers the subsea cable project from the project’s inauguration in 2022 – till the present day. Philenews reported that the audit covers the role of Politically Exposed Persons or former state officials in promoting the cable project. The newspaper also said the audit is looking into the procedure via which the project promoter had secured a €658 million grant from the European Union. The European Public Prosecutor’s Office is already investigating the contract with the Chinese CPP for the construction of a liquefied natural gas regasification terminal in Vasilikos.

VASILIKO PROJECT

The floating, storage and regasification unit (Fsru) is currently moored in Malaysia where it’s undergoing technical checks. It is already certified as a single-voyage LNG carrier but it also needs to be certified as a storage and regasification unit. To do that, it must dock at an operational terminal to be tested. Since the terminal at Vasiliko is incomplete, the ship will have to dock elsewhere. Alexandroupolis in northeastern Greece may be the likely next destination. It could stay there for about a year, until works are completed at Vasiliko.

On the 06/01/25 Philenews reported that the Cyprus Natural Gas Infrastructure Company (ETYFA) is in the final stages of selecting a project manager to oversee the completion of the LNG terminal. Unofficial sources suggest the frontrunner is an internationally reputed firm with extensive experience in managing incomplete and problematic infrastructure projects. Following the project manager selection, ETYFA plans to issue a tender for a new owner’s engineer to replace Hill International, whose contract has expired. The appointment of a project manager is expected to pave the way for new tenders to identify contractors to complete the jetty and onshore facilities.

DRILLINGS

ExxonMobil’s drilling rig will start drilling in mid-January at the ‘Electra’ target, located in Block 5 of Cyprus’ Exclusive Economic Zone (EEZ), for approximately one month, Energy Minister George Papanastasiou said on the 26/12/24.

“The geological structures we observe at ‘Electra’ are optimistic & the drilling rig will be used for two drillings, one at the ‘Electra’ target and another at the “Pegasus” target in Block 10”.

He also said the development and production plan for the ‘Cronos’ target is expected at any moment from Eni and Total while the consortium of Chevron, Shell, and New Med Energy is waiting for Cyprus’ response on whether the development and production plan for ‘Aphrodite’ they submitted is acceptable.

CYPRIOT NAVTEX AND TURKISH RESPONSE

Following a NAVTEX issued by the Republic for drilling to be carried out by the ExxonMobil and Qatar Energy consortium offshore plot 5 from December 24th 2024 to February 24th 2025, the occupied North’s “Ministry of Foreign Affairs” said these actions are  “unilateral,” and warns of a possible escalation of tension. Ankara claimed, it proceeded with filing a protest against the Republic of Cyprus to the UN Secretary General and Security Council questioning the legality of the Navtex. On the 06/01/25 Philenews reported that Turkey will escalate its actions in response, with increased aggression expected in the coming weeks.

POSSIBILITY OF A MARITIME DEMARCATION AGREEMENT BETWEEN TURKEY & SYRIA 

The government said that it was closely monitoring developments after Turkey announced it was aiming to strike a maritime demarcation agreement with Syria once a permanent government is formed in Damascus. “Any attempt to challenge, influence or disregard the sovereign rights of the Republic of Cyprus constitutes a violation of international law and the Republic of Cyprus will take all available measures at international and European level,” said government spokesman Konstantinos Letymbiotis. President Christodoulides stressed the importance of “discreet” diplomacy “Away from the spotlight, we are taking all necessary steps to prevent any unlawful actions,”. Asked about the possibility of demarcating the Exclusive Economic Zone (EEZ) between Greece and Cyprus, the President responded cautiously: “The less we say publicly, the better.” 

Journalist Kostis Konstantinou noted that this scenario could only materialise once the new Syrian political landscape stabilises, and only if the new Syrian leadership becomes so dependent on Ankara that it would risk confrontation with regional players and the Americans, who have vested interests in the Cypriot EEZ, merely to appease Turkey. All indicators suggest that stability remains a distant prospect, and despite Damascus’s publicly proclaimed close ties with Turkey, such complete dependence on Ankara neither exists nor is feasible.

VIRTUAL EASTMED PIPELINE

Politis reported on the 27/12/24 that the idea of ​​a virtual EastMed pipeline from Israel to Europe via the Cypriot EEZ is an alternative – and perhaps more realistic – approach to the original physical pipeline plan. Gas will be transported to a floating unit that will liquefy it and then it will be shipped to Europe. Liquefaction could also be done at a terminal in Cyprus. Discussions for this idea are still at an early stage but it came out of the ‘drawer’ as Israel prioritizes its energy security after the Oct. 7 attacks and Israel wants to be 100% on its choices. There is ongoing cooperation with Cyprus and Greece and is the obvious safe choice. An intergovernmental agreement was signed by Minister Cohen in Athens and a meeting is also planned with his Cypriot Minister early next year. The main source of gas will be Leviathan & Tamar (and if there is gas from the Electra field of Cyprus it will make it even more interesting) and this idea has the advantage of lower costs & greater flexibility. But the EastMed remains on the EU’s list of projects of common interest (PCI) and has not been formally abandoned. 

ENERGY ANALYST VIEWS

The utilisation of liquefied natural gas (LNG) could reduce electricity bills by as much as 35 or 40 per cent, energy expert Charles Ellinas said. The terminal at Vasiliko “must be accelerated as quickly as possible”, and, if possible, by the end of the year. However, he expressed doubt over whether this will be possible. As regards block 5 of Cyprus’ Exclusive Economic Zone (EEZ), where ExxonMobil is set to commence drilling in the coming weeks he said that “the indications are good” but immediate developments. should not be expected. ExxonMobil is a very cautious company & does not proceed rapidly with its projects. But if it finds enough gas, it could move forward with the idea of exporting liquefied natural gas in the future.

GENERAL ECONOMIC/FINANCIAL NEWS

PolitIs reported on the 24/12/24 that a multinational company operating in the real estate sector and active in the Republic also maintains offices in the occupied areas, advertising Greek Cypriot properties for sale. The Real Estate Agents Registration Board has made an official complaint to the Police also raising the question of whether the company should be allowed to maintain offices in both the south and the north.

President Nikos Christodoulides will chair a high-level meeting today (07/01/25) to discuss the future of Larnaca Port.

The property market is expected to experience a slowdown in growth in 2025, according to Danos Property consultancy that forecasts moderate growth over the next two years.

Philenews reported that the mixed community of Pyla is experiencing unprecedented growth due to surging property demand despite its unique administrative status. More than 1,000 residential units are under construction, with permits pending for an equal number. The largest development underway is a €30 million complex comprising approximately 300 residential units and retail spaces. Land purchases for residential development are primarily driven by Greek Cypriots but there is significant interest comes from Israeli, Lebanese, Ukrainian and Russian investors.

The Cypriot government and Hermes Airports signed a new agreement, extending the management of Larnaca and Paphos airports until 2033. The deal resolves longstanding financial disputes and paves the way for significant airport expansion projects.

Cyprus’ Fiscal Council acknowledged the country’s robust growth and fiscal prudence, but also sounded caution over emerging risks and structural vulnerabilities that could undermine long-term stability. The broad-based nature of Cyprus’ growth, with significant contributions from sectors such as information technology, tourism, and financial services has bolstered the economy’s ability to withstand external shocks. But the ongoing instability in the Middle East and Eastern Europe, coupled with the potential rise in global protectionism, were flagged as significant threats to Cyprus’ economic outlook. Other concerns include inflationary pressures, the sustainability of Cyprus’ fiscal discipline & climate change.

According to the Cyprus retail trade association, the retail sector contributes 15 per cent to GDP (second only to tourism in importance) and employs 18 per cent of the workforce. Supermarkets remain the backbone of retail, generating over €2.3 billion in annual turnover while the overall retail turnover exceeds €3 billion. Its growth is attributed to the impact of tourism and the spending power of foreign residents, including Russians, Ukrainians and more recently, Israelis.

The basic salaries of civil servants, government employees and state officials will rise by 1.25 per cent as of January due to the Cost of Living Allowance.

A new report by the European Banking Authority (EBA) reveals that two executives from Cypriot banks were among the 2,122 individuals in Europe who earned over €1 million in annual compensation in 2023.