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Chinese investors eyeing Malta

DESPITE government assurances that a proposal to clinch the Chinese deal for the old Larnaca airport will be ready by the end of the month, fears are growing that the investors may turn to competitive Malta instead.

On Wednesday Communications Minister Efthymios Flourentzos said the government was in the final stages of completing a proposal with the terms and conditions for the €600 million investment by Chinese company Far Eastern Phoenix (FEP). He said it would be handed over to the investors by the end of the month, saying it would then be up to FEP to decide whether to accept it or not.

But opposition DISY’s parliamentary spokesman Tasos Mitsopoulos echoed the concerns of the Hermes Airports’ spokesman that the government could be too late, saying he had information that FEP was in talks with Malta to invest there instead.

“I am in a position to know that the Chinese are in contact with Malta in the event that this investment sinks, to transfer it to a competitive country and economy,” said Mitsopoulos.

He added, “Two weeks ago I was in Brussels and had a conversation with an Irish colleague, who said they had a similar Chinese investment in Ireland, which under the orders of the prime minister of the country, was completed in three months. The entire procedure to examine, assess the terms, survey and sign the contract took three months, and this is because this country, like Malta and others want to show they are ready to host foreign investments and contribute to growth during this difficult crisis period.”

Mitsopoulos wondered “how will we have growth and new job positions if we don’t have foreign investments?”

Hermes Airports’ PR and communications manager, Adamos Aspris, was equally concerned, saying the government’s delay in presenting FEP with a final proposal could lead to Cyprus missing out on the investment altogether.

He blamed the delays on red tape, adding that the economy was in dire need of the investment – a plan to transform the old airport into a commercial centre with a showroom and bonded facilities for Chinese factories to display products for a 50-year period.

“I think it is important that all of us attempt to avoid entering what I would describe as ‘roundabout’ reasoning; meaning we can’t decide what direction to take and so we keep going around in circles,” said Aspris.

He added, “I think we should take the correct turn, otherwise allow me to say that we are in danger of running out of fuel”.

Aspris said time wasn’t unlimited, as no investor was interested in entering exhausting bureaucratic procedures, nor did the state have the luxury to turn down such an important investment at times of economic crisis.

But minister Flourentzos denied there was a problem with bureaucracy, claiming instead that the government was moving ahead “very swiftly” with finalising its proposal – “so that it can conclude as soon as possible on specific results”.

He said FEP would be presented with the proposal by the end of the month. “The reply will be in the hands of the investor,” said Flourentzos.

Speaking after yesterday’s cabinet meeting, Government Spokesman Stefanos Stefanou said the government’s main goal was to finalise the procedures as soon as possible “so all the problems can be overcome so that the investment can be implemented”.

A deal was first reached between FEP and Hermes a year and a half ago for a 19-year period, when the latter’s concession agreement on the old airport expires. The Chinese company sought to extend that deal for a further 31 years to justify the large investment.

However, finalisation of the 50-year agreement has hit a number of snags, with the state remaining unsure as to whether to approve the deal or not.

Chinese Investors Eyeing Malta