AGP Executive Report

Tourism Licensing: Cyprus’ Audit Office warns that only 23% of hotels and tourist accommodations are fully licensed, with 402 of 728 operating without a licence, citing weak enforcement and control gaps at the Deputy Ministry of Tourism. Energy Security: MPs warn Cyprus could face electricity shortages by 2030 after delays and grid vulnerabilities tied to the stalled Vasilikos LNG project, with concerns over decommissioning capacity and costly emissions allowances. Border & Travel Tech: Ryanair warns of “queue chaos” at EU airports this summer as new fingerprint checks under the Entry/Exit System (EES) strain airport readiness, pushing for suspensions. Consumer Costs: Cyprus inflation accelerated in June to 3.2% year-on-year, driven by housing/utilities and food price pressure. Retail Payments: Lidl Cyprus launches Lidl Pay inside the Lidl Plus ecosystem, adding a secure digital wallet and faster checkout via card scanning. Digital TV Switch: DVB-T2 switchover triggers complaints, with causes blamed on older antennas, cabling and decoder issues. Business & Finance: Cyprus’ financial wellbeing index rose in 2025, but the Finance Ministry says household pressure remains, especially from inflation, energy costs and pension anxiety.

Energy & Industry: ExxonMobil and QatarEnergy have declared Cyprus offshore gas discoveries commercially viable, with plans pointing to potential production timelines into the 2030s, while Cyprus’ energy outlook also faces calls for clearer long-term direction amid “continuous concessions” concerns. Tech & Education: AUB Mediterraneo and Cyta signed an MoU to link academia with industry through internships, executive lectures, workshops and joint research, aiming to boost Cyprus’ digital skills pipeline. Business & Finance: The Central Bank of Cyprus cut its 2026–27 growth forecasts, citing Middle East war risks, as Eurobank outlined a €1bn tech and AI-driven banking transformation. Inflation & Cost Pressure: Cyprus inflation hit 4% in June, among the EU’s highest, with prices in retail and services still worsening despite broader eurozone cooling. Regulation & Markets: CySEC chairman George Theocharides said retail prop trading is not an ESMA immediate priority, while EU-level work continues on critical medicines supply security. Local Economy: KPMG says Paphos is diversifying beyond tourism into real estate, education, tech and professional services. Trade & Logistics: Port Shield 2026 tested emergency response at Limassol port. Notable Cyprus-linked death: Business magnate Nicos Shacolas (CTC Group) died aged 98.

Monaco Security Shock: A parcel bomb in Monaco injured Ukrainian tycoon Vadym Yermolaiev, his partner and their 13-year-old son; prosecutors opened an attempted-murder probe and a suspect was reportedly detained then released as a manhunt continues. EU-Turkey Trade Friction: Turkey’s foreign minister accused Cyprus of blocking an EU-Türkiye customs union upgrade, escalating a dispute that could affect regional business and logistics. Cyprus Energy Watch: ExxonMobil and QatarEnergy declared two Cyprus offshore gas fields “marketable,” while an energy expert warned the island may be making “continuous concessions” and that exports may not start until around 2033. Port Security in Limassol: “Port Shield 2026” tested counter-terror readiness at Eurogate’s container terminal with police, emergency services and port authorities. Inflation & Growth Signals: Cyprus inflation hit about 4% in June as the Central Bank cut growth forecasts amid Middle East risks. Tourism & Consumer Moves: Jet2 expanded Jet2Weddings with new destinations including Cyprus from Summer 2026, while Lidl launched its “Better Living Days” wellness roadtrip in Paphos.

Energy & Industry Prices: Cyprus industrial output prices rose 2.5% in May year-on-year, with electricity supply up sharply (+13.4% month-on-month) and manufacturing also higher (+0.8% month-on-month), according to Cystat. Food & Household Costs: A Trojan Economics analysis says food prices are again outpacing overall inflation, squeezing household budgets as the gap reopens in early 2026. Tourism Pressure: Deputy Tourism Minister Kostas Koumis told MPs losses in 2026 should stay under 12%, with May showing a smaller decline and June passenger arrivals down but still improving versus past years. Offshore Gas Deal: QatarEnergy signed a commercial discovery declaration for Block 10 offshore Cyprus (Glaucus and Pegasus) with the Government of Cyprus and ExxonMobil, moving development planning forward. Corporate/Investments: OCI Global’s court-appointed directors consent to an extraordinary general meeting to approve the OCI–Orascom transaction tied to NNS’s EUR 4.10 all-cash offer. EU Policy Shift: Ireland took over the EU Council Presidency from Cyprus, prioritising competitiveness, security, and the 2028–2034 budget talks. Agri-Food Recognition: The 12th Gastronomos Quality Awards celebrated Cyprus’ top producers and artisans during a festival in Vouni, Limassol. Research Spotlight: EMU led Cyprus in Physical Sciences in the Nature Index 2026 Research Leaders ranking. Security/Crime (Regional): A Monaco parcel-bomb attack injured three people, with authorities treating it as attempted murder and reporting a suspect still at large.

Monaco Security Shock: A parcel bomb exploded at the entrance of a residential building in Monaco, injuring a Ukrainian-born tycoon with Cypriot ties, his wife and their 13-year-old child; prosecutors opened an attempted murder case and a cross-border manhunt is ongoing after CCTV showed a suspect fleeing toward France. Cyprus Energy Update: ExxonMobil, QatarEnergy and the Republic of Cyprus signed a Declaration of Commerciality for the Glafkos and Pegasus gas fields in Block 10, moving the projects into development planning with production targeted for 2033 and a final investment decision expected around 2029. Agriculture & Water Pressure: MPs warned that current water policy could push farmers out of the primary sector, questioning irrigation allocations and extensions for golf courses while the government defends a “balance” to protect dam reserves. Consumer Protection: Parliament began debate on a bill to crack down on greenwashing, shifting the burden of proof to vendors for misleading eco claims and requiring substantiation across a product’s full life cycle. Shipping & Maritime: Cyprus’ shipping deputy minister met Polsteam Shipping to review priorities and reaffirm Cyprus’ push to strengthen its maritime hub role. Digital Infrastructure in the North: Türk Telekom plans $100m+ to upgrade telecoms in occupied northern Cyprus, including fiber and 5G rollout tied to a “digital island” vision.

Tourism & Hospitality: Pasyxe, the Cyprus hoteliers association, will hold its AGM in Nicosia on July 7 to elect new leadership for 2026-2029, with president Nikos Christodoulides expected to address sector performance and the need for a roadmap to protect Cyprus’ tourism competitiveness. Housing Policy: EU ministers adopted the bloc’s first Council conclusions focused on housing under the Cyprus Presidency, linking affordability and supply pressures to demographics, urbanisation, climate impacts and labour mobility. Energy Security: An energy expert warns Cyprus still lacks a coherent long-term strategy, citing the island grid’s limits, heavy fuel import reliance, delays in key projects, and insufficient storage for renewables. Labour Market: Cyprus recorded 63 occupations with labour shortages in 2024, with the biggest gaps in healthcare and digital technology, plus shortages tied to tourism and construction trades. SME Safety Rules: Keve is urging SMEs to take part in an EU Commission survey on occupational safety and worker rights in subcontracting chains ahead of the Quality Jobs Act. Real Estate: The Central Bank says apartment prices rose 10.8% in Q1 2026 year-on-year, driven by foreign demand and higher construction costs. Water & Ports: Cyprus is moving toward near-total desalination coverage, with desalination now supplying about 80% of drinking water, while a counter-terrorism drill “Port Shield 2026” is set for Limassol Port on July 1. Agri-Food: The EU Council gave final approval to rules strengthening farmers’ position in the food supply chain, including standard written contracts and better collective bargaining. Chemicals Oversight: EU lawmakers agreed a new legal framework to bolster ECHA’s chemicals oversight, aiming to keep the system workable and predictable for industry. Industrial Fire: Firefighters battled a major blaze at an Aradippou refrigerator manufacturing factory, treating four for heat and smoke-related issues while confirming all employees were accounted for. Mining/Metals: Cyprium Metals says its Nifty Copper Complex restart remains on track for first cathode production in the September quarter of 2026, with heap leach progress and key equipment arriving on site.

Water Security: Cyprus says desalination now covers about 80% of drinking water, with near-total coverage targeted by 2027 as new Limassol Port units come online. Port & Emergency Readiness: “Port Shield 2026” will run at Limassol Port on July 1, testing coordination among police, ambulance, fire service and port authorities during a simulated security incident. Industrial Safety: A major Aradippou factory blaze (frozen food/refrigeration) has spread across the building; firefighters treated multiple crew members for heat and smoke exposure while roads into the industrial area were closed. EU Industry & Research: The EU Council gave final approval to reform the coal and steel research fund, extending support to 2034 with up to €120m annually to back industrial transition and innovation. Energy Transition: The EU backed a tripartite energy storage deal, pushing member states to raise annual storage deployment sharply from 2025 levels. Shipping & Ports Funding: Brussels is also advancing a European Competitiveness Fund concept aimed at financing cleaner ships, smarter ports and maritime tech. Tourism Impact: Cyprus tourism revenues fell 35.1% in April 2026 year-on-year, blamed on Middle East conflict and regional instability. Labour Market: A new EURES report flags persistent Cyprus labour shortages, especially in healthcare, digital roles and construction-linked trades. Property Watch: Apartment prices in Cyprus hit a record high in Q1 2026, outpacing house price growth amid constrained supply and higher construction costs. Local Infrastructure: A key Larnaca road planned for 2026 is now expected no earlier than 2031, renewing pressure over safety and traffic problems.

Cyprus as EU–ASEAN gateway: A Cyprus delegation led by the High Commissioner of Cyprus and the Chief Scientist showcased local tech and maritime expertise in Singapore, pitching Cyprus as a bridge to Europe for global alliances. Maritime connectivity: SES and Tototheo Global signed a multi-year deal to roll out SES FlexMaritime services, combining satellite and terrestrial links for merchant shipping. Shipping competitiveness: Deputy Shipping Minister Marina Hadjimanolis said strengthening the Cyprus flag remains a priority, citing digitalisation and decarbonisation pressures on the sector. ESG skills for finance: UCY MBA students took part in an Erasmus+ ESG investment and finance BIP in Bilbao, covering sustainable finance, regulation, reporting and risk management. Tourism pressure in Paphos: Hotel occupancy in Paphos is down about 20% versus last year, with demand only partially recovering via last-minute bookings and domestic offers. Food prices up: Cyprus Consumers Protection Association reports higher prices for 250 basic items in May, with the biggest jumps in processed meats, oils and coffee. Energy policy watch: Cyprus solar households face a major shift as net billing replaces net metering. EU trade impact on e-commerce: From July, a €3 duty on certain non-EU goods (up to €150) could raise costs and add customs uncertainty for Cyprus-linked deliveries. Local business & construction: Walk In Builders & Developers inaugurated its premium “Nirvana” residential project in Mangaluru, reflecting continued regional construction momentum. Maritime community event: Cyprus Marine Club drew a record crowd for an MSC-linked industry gathering, adding new corporate members and spotlighting seafarers.

EU Defence Push: Cyprus is praised for strengthening Article 42.7 during its EU Council presidency as Brussels drafts a more operational mutual defence “playbook,” with a focus on crisis management and practical assistance. Energy & Homes: Cyprus solar households face a major shift as net billing replaces net metering for new residential PV from 1 Jan 2026, while curtailments and storage changes are already reshaping investment economics. Construction & Housing: Walk In Builders & Developers inaugurates its premium “Nirvana” residential apartment project in Mangaluru, highlighting continued demand for planned, high-end developments. Tech Costs for Businesses: Cyprus firms brace for Microsoft subscription price rises from 1 July, dubbed an “AI tax,” with increases up to 33% for frontline packages. Retail & Logistics Impact: New EU customs duties on low-value non-EU e-commerce (including Temu and Shein) could add cost and uncertainty for Cyprus consumers and delivery operators. Healthcare Investment: Hadassah Medical Center Limassol opens with a new care pathway model, bringing advanced diagnostics and specialist support via Israel. Local Culture: Larnaca Festival returns for its 41st edition in July under the “Rhythm of Skala” theme, with music, dance and theatre across key venues.

Energy & Renewables: Cyprus solar households are facing a major rule change as net billing replaces net metering for new residential PV installations from 1 January 2026, with curtailments, storage and the competitive electricity market already reshaping project economics. Fuel Policy: The reduced excise tax on motor fuel has been extended until Sept. 17, keeping an 8.33 cents per litre cut and targeting about €15.5m in consumer benefit. Water Infrastructure & Public Reaction: Desalination plans are heating up after protests against a proposed mobile desalination unit in Mazotos, with residents warning it may be effectively permanent. Telecom Competition: Debate over a third telecom operator is back on the agenda as Cyprus looks to boost competition alongside existing mobile providers. Agriculture Support: The agriculture ministry is reviewing additional FMD aid requests from sheep and goat producers, amid calls for emergency support over feed costs and movement restrictions. EU Islands Strategy: Cyprus’ EU presidency helped push forward the first-ever EU Strategy for Islands and a coastal communities plan, with the focus now shifting from vision to action. Industry & Courts: An appeal to suspend a planned asphalt concrete production plant near Mitsero was dismissed, with the court ordering an expedited hearing of the pending case.

EU Islands & Coastal Strategy: The EU unveiled its first-ever Islands Strategy and a parallel plan for resilient, prosperous coastal communities, presented in Pafos during Cyprus’ outgoing EU Presidency, aiming to move from “vision to action” with better transport links, digital upgrades, climate and energy resilience, and a clearer political framework for island economies. Energy Grids Push: EU energy ministers agreed a negotiating position for the European grids package, including faster permitting and stronger cross-border interconnections, to unblock electrification and decarbonisation as infrastructure planning lags behind demand. Horizon Europe Momentum: The EU Council set a partial negotiating stance for Horizon Europe (2028-2034), linking research funding to competitiveness goals while leaving broader budget issues for later talks. Cyprus Agriculture Support: Cyprus’ agriculture ministry is reviewing a fresh request for additional FMD aid for sheep and goat farmers, as producers warn restrictions are driving feed costs up and sales delays are piling animals on farms. Court on Asphalt Plant: Cyprus’ Court of Appeal dismissed an attempt by communities to suspend a planned asphalt concrete production plant near Mitsero, clearing the way for an expedited appeal hearing. Marine & Fisheries Pressure: Cyprus removed over 100 tonnes of toxic pufferfish under a subsidy scheme, while Greece considers similar incentives as invasive toxic species spread. Local Business & Media: Nicosia-based Periti Studios launched as an independent film and AI-assisted media studio, expanding feature, short-form and animation work from a small local crew. Textiles Trade: ITM 2026 in Istanbul drew 48,257 professional visitors from 105 countries, underlining continued global demand for textile machinery and technical textiles.

EU Islands & Coasts Strategy: The European Commission is rolling out two first-ever strategies aimed at cutting the “cost of insularity” for islands and coastal communities, targeting transport links, digital infrastructure, climate and energy needs, and housing/public service costs. EU Energy Grids Push: EU energy ministers agreed a negotiating position for a European grids package to speed up cross-border electricity infrastructure, streamline permitting, and strengthen interconnections—key for electrification and decarbonisation. Horizon Europe Momentum: The EU Council set its partial stance for Horizon Europe 2028-2034, linking research funding to the next competitiveness instrument to smooth the investment path. Cyprus Pufferfish Removal: Cyprus removed over 100 tonnes of toxic pufferfish under a subsidy scheme for professional fishers, as Greece weighs similar incentives to curb the invasive species. Fuel Relief Extended: Cyprus extended an 8.33 cents per litre fuel tax cut until Sept. 17 to shield households and businesses from volatile oil markets. Road Data by Drone: Public Works will run drone flights along major motorways from June 29 to July 9 to collect traffic data for future planning. Cybersecurity Alert (TRNC): A major data breach reportedly exposed health records of 364,000+ people on the dark web, raising risks of identity theft and fraud. Textile Industry Signal: ITM 2026 in Istanbul drew 48,257 professional visitors from 105 countries, underlining global demand for textile machinery and technical textiles. Local Business Watch: Cyprus Business Now highlights banking outlooks, tourism trends, Logicom and Tototheo updates, plus fuel and CySEC/CSE items.

Energy & Infrastructure Policy: Cyprus’ EU presidency helped secure agreement on the European grids package, pushing faster cross-border planning and permitting to speed electrification and decarbonisation. EU Research Funding: EU Council backed its negotiating position for Horizon Europe 2028–2034, aiming to strengthen the research-to-industry pipeline and boost competitiveness. EU Islands & Coastal Strategy: Cyprus closed its EU presidency with calls to put islands and coastal communities at the heart of Europe, highlighting new EU strategies to cut the “cost of insularity.” Transport & Roads: Public Works will use drones on major motorways (Nicosia–Limassol, Nicosia–Larnaca, Larnaca Airport–Ayia Napa) from June 29 to July 9 to map traffic flow without disrupting drivers. Fuel Costs: Cyprus extended the fuel tax cut (8.33 cents/litre incl. VAT) until Sept. 17 to cushion households and businesses from volatile oil markets. Property & Courts: The Court of Appeal rejected a €41m claim over Turkish Cypriot-owned land tied to Paphos airport and refugee housing. Local Planning Dispute: Cyprus’ appeals court rejected an attempt to block an asphalt plant in Mitsero, allowing construction to proceed pending further appeal. Social Infrastructure: A specialised day care centre for adults with severe autism in Strovolos moved forward after an architectural competition selected eight designs.

EU Budget Talks: Cyprus’ EU presidency has pushed a first draft on the next long-term budget, proposing a 2% cut (to €32.8bn) while slightly boosting CAP and cohesion—yet member states remain split on ambition and generosity. AI & Skills: Deputy Minister Nicodemos Damianou told UCy graduates that AI can assist, but human judgement can’t be replaced, warning Cyprus must prepare workers for fast-changing skills. Broker Rules: A new EU Retail Investment Strategy is set to reshape broker business models with tougher expectations on fees, advertising and product clarity. Islands & Coasts: President Christodoulides closed the presidency in Paphos by unveiling EU strategies for islands and resilient coastal areas, targeting connectivity, climate and energy/water security. Maritime Safety: The IMO paused its Persian Gulf evacuation plan after an attack near the Strait of Hormuz, leaving seafarers and shipowners—key for Cyprus—waiting for clearer safety guarantees. Energy & Trade: EU Council formally adopted tariff measures under the EU-US trade deal, removing duties on US industrial goods and extending lobster import suspensions. Local Business & Education: European University Cyprus and K. Treppides & Co signed an MoU for scholarships and apprenticeships in finance and business. Tourism Shift: Cyprus tourism is seeing more last-minute bookings, shrinking planning horizons for hotels and airlines. Shipping Community: Andreas Christoforou was re-elected to YoungShip’s international board as Southern Europe representative, expanding Cyprus’ maritime footprint. Construction Costs: Eurostat data shows Cyprus residential construction prices hit a record high in 2025, up about 18% since 2021. Heat & Agriculture Risk: An ECB study flags compounding heat and drought threats to Mediterranean economies, with agriculture in Cyprus among the hardest hit. Tech Showcase: Cyprus promoted its innovation ecosystem at London Tech Week 2026, pitching opportunities in fintech, AI, cybersecurity and digital services. Mining Updates: Cyprium appointed a chief technical officer to support the phased restart of the Nifty Copper Complex, while Elixir completed a fracture stimulation program at Lorelle-3H in Queensland.

EU-US Trade Deal: The EU Council has formally adopted tariff measures under the August 2025 EU‑US Joint Statement, removing remaining EU duties on US industrial goods and expanding preferential access for selected products, while keeping safeguards to act fast if commitments aren’t met. Customs & Retail Impact: Cyprus is set to scrap the €150 low-value parcel duty exemption for non‑EU online shopping, replacing it with a temporary €3 flat charge per product category from 1 July 2026 (VAT on top), hitting Temu and Shein-style orders. Energy & Transport Costs: Parliament extended Cyprus fuel tax relief by two months to 31 August, keeping reduced excise rates to cushion summer price pressure. Construction Watch: Eurostat data shows Cyprus residential construction costs for new buildings hit a record in 2025, up about 18% since 2021. Water Sector: The Water and Sewerage Corporation ran its second Integrated Water Resources Management workshop, bringing together key ministries and utilities to coordinate water, land and related planning. Aviation & Emergency Response: RAF Cyprus received two Airbus H145 Jupiter HC Mk2 helicopters to boost emergency response, firefighting, medical evacuation and surveillance roles. Crypto Compliance Deadline: Cyprus crypto firms face a six-day countdown to MiCA full implementation, with many needing MiCA authorization or exit plans. Local Governance: Nicosia roadworks are causing central congestion as Kritis and Philippiados streets remain closed.

Cyprus Property & Construction: Apartment prices in Cyprus keep climbing, with new data showing a 10.8% rise and continued momentum in sales—developers are also pushing for faster licensing and more housing supply as affordability and planning delays stay front and centre. Real Estate Sector Pressure: The Cyprus Real Estate Developers Association held its key Limassol dinner with the Interior Minister in the spotlight, underlining how government policy and city pressures are shaping the next phase of growth. Maritime Cooperation: Greece’s shipping minister met Cyprus, Italy and Malta counterparts in Rome to strengthen Mediterranean shipping ties amid regulatory change and the green transition. Anti-Organised Crime Agenda: Cyprus’ justice minister warned organised crime is “already watching us,” outlining money-laundering harmonisation plans and a wider legislative push, including surveillance and juvenile detention reforms. EU Labour Rules (Cross-border Services): EU lawmakers agreed a digital declaration portal for posted workers, aiming to cut administrative burden and improve monitoring for businesses operating across member states. Finance & Capital Markets: CySEC handed €1,000 awards to top university research in capital markets, while S&P upgraded Freedom Holding Corp subsidiaries to “BB-” with stable outlooks. Payments & Compliance Events: Cyprus is set to host the NextGen Payments and RegTech Forum in November, focusing on digital payments, fraud prevention and regulatory tech. Energy & Industry: Cyprium Metals says its Nifty copper cathode restart is moving from construction into commissioning, with sulphuric acid supply chain re-established after a new terminal milestone. Workplace Safety (EU): Cyprus’ EU presidency backed an agreement tightening limits for hazardous substances at work, targeting cancer and asthma risks. Tourism Safety: Lifeguards across Cyprus staged a 24-hour strike over understaffing, warning that coverage gaps endanger beachgoers.