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Deal for development of old Larnaca airport signed

The Island’s airport operator Hermes signed a multi-million Euro deal with Chinese company Far Eastern Phoenix early this morning for the redevelopment of the old Larnaca airport facility.

FAR EASTERN PHOENIX plans to develop the old Larnaca airport with a large commercial showroom for Chinese products and a logistics centre. The project will include exhibition areas, re-import of products and a small conference centre.

The chairman of Hermes Airport, Adamos Aspris, said that the final agreement was signed at 1:00 am this morning

According to the agreement, the firm will take over the management of the area for the next 19 years with the possibility of extending it to 50.

In answer to a question about jobs raised during a press conference in Larnaca, Mr. Iacovou said that “We have been ensured that thousands of Cypriots will be employed”, adding that “I expect that a number of foreign workers will be employed too”.

“It is an agreement of exceptional importance, which will benefit not only the airports but the country in general since we expect that a large number of new job posts will be created for the Cypriots and the economy of Cyprus will be boosted, especially in those difficult conditions”, he stressed.

As for the 50-year lease, Mr. Iacovou said that the government must agree. “It is the government’s right to accept or reject it”.

Asked about the timetable for the agreement, Mr. Iacovou said that there isn’t one but the project will start as soon as the permits have been secured and will be completed in two years.

The Chinese company will be responsible for the project while its funding will be provided by the Chinese state bank.

Readers' comments

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  • Nick Nicolaou says:

    Great news. This project will benefit both parties. The new centre for Chinese products at the crossroads of three continents.

  • George christo says:

    This is a very good step for Cyprus to take especially in these competitive times. It will of course benefit the island as well as generate job opportunities and also bring people from different cultures meaning that the people of Cyprus will need to make adaptions to cater for these people visiting and trading on the island. Zuo de hao cyprus ! From Qiao zhi

  • George says:

    @ Nigel – Probably right. A nice big bank account?

  • George says:

    Sorry Nigel for posting a 3rd time in a row, I don’t know if this is against forum etiquette and wont keep doing it, its just that this is the first good news I’ve had in a while.

    But Ive been trying to look up Far Eastern Phoenix on Google and I’ve found some companies with similar names but not the exact one mentioned. Could it be newly formed for this venture but owned by an existing big player or what?

    @George – I expect the name Far Eastern Phoenix is a translation from the Chinese, but I see that have opened a bank account in Nicosia.

  • George says:

    Its impressive that the government has managed to secure 4,000 jobs for Cypriots when the Chinese nearly always send their own crews from engineers to brickies.

    And if they are only renovating existing real estate then it probably could be finished and operating quite quickly. Larnaca could be booming in one year?!

    They will have to employ more people in immigration dept as everyone from Iraq to Timbuktu will need visas. I hope that buyers will be able to travel freely around Larnaca and spend their € and not just within the free-trade zone.

  • George says:

    Over 5% of the Rep of Angola’s population is now Chinese due to its oil/gas/construction boom. Over 500,000 people if I’m not mistaken. Some complain that they live separate lives in Chinese compounds but so do Brits and other expats.

    Cyprus needs strong ties with China and I am glad Christofias and AKEL are taking advantage of their communist background to create a long lasting relationship with China. China has muscle,c ash and tends to be loyal to (although not saints when it comes to Tibet) its friends.

    This project would inject serious cash flow into Larnaca, would do wonders for Larnaca’s unsold/half built properties, think of thousands of them needing homes.

    It has to happen first though.

  • Costas Apacket says:

    Yes Nigel, but at least in Ireland there is some form of transparency and public accountability which is sorely missing from most walks of life in Cyprus.

    It’s very co-incidental that following the hydrocarbon finds off the shores of Cyprus all of a sudden there is a big rush to invest in Cyprus and purchase Government bonds by the likes of China, Russia et al.

    Whilst being a member of the EU, the Government of Cyprus is cozying up to these communist opportunists in order to try and remain outside the EU support mechanism, which in turn maintains this lack of transparency and public accountability.

  • @Denton – China is also making a deal with the Republic of Ireland for facilities at Shannon airport in Dublin. See Ireland seeks China investment.

  • Denton Mackrell says:

    As someone who worked for many years in Asia, I always consider the strong possibility of covert motives with deals like this one. The public statements by Asian entrepreneurs are usually for public consumption only and rarely reflect the full picture.

    The same may be said for the Triple 5/Ghermezian razzamatazz which has pretty weak ‘face validity’. Is there someone or some entity really behind and benefitting from Mr G’s high profile adventure in Cyprus and in what way? Is he a proxy? How penetrating were the government’s due diligence checks? I doubt that the Cyprus government has the faintest clue or really cares, even if it is to the detriment (even politically) of the country.

  • @AnnDee – if you were to ban all products coming out of China there would be no iPads, iPhones, Kindles, PlayStations, Wiis and Xboxes and a whole host of other electronic gadgets and components.

    No doubt that the computer you used to make your comment contains many components sourced from China.

    There are, I agree, some awful pieces of junk emanating from the PRC, but I doubt that these will be on display.

  • AnnDee says:

    Whilst I welcome projects which will employ local residents I dread the thought of more Chinese goods.

    In my experience we and the rest of the world are being dumped on with shoddy merchandise which may last a year if you’re lucky. I would ban all Chinese imports per se.

    My latest purchase made in PRC was a multisocket, and 3 out of the 4 switches wouldn’t switch down.This had a CE kitemark, but that’s worth nothing these days. Is a showroom of shoddy goods going to upgrade the ROC’s reputation of value for money? I think not.

  • Denton Mackrell says:

    I think Martyn is right to be wary about the hindrances and incompentencies that may crop up. I have just been dealing with a foreign entrepreneur (also with backing from his government) who is examining investment opportunities in Cyprus (and around the world). He looked at one project here where all the public statements and PR razzamatazz said that it was ‘this big’, would have a very large number of customers in year 1 and would be fully operational within 8 months. What he found was that building work had only just started and would probably take at least another year to complete. Also the projected customer numbers were, in his opinion and many others’, vastly inflated.

    There is an awful lot of fantasy and froth surrounding so many of these projects – viz Qatar hotel in Nicosia, theme parks, yet more golfing complexes etc. Regrettably, these ‘chancer’ projects that don’t materialize then taint the smaller number of sound ones by making potential investors very wary.

  • Martyn says:

    Wow, what a welcome change from all the highly down-beat economic, financial, explosion impacts and property and legal scandals, affecting the Island.

    Despite the ‘inter-continental’ voice- over we can see a potentially viable, impactful, relatively short-development-time and fully-funded? enhancement of the Islands currently ‘sand-banked’ economy, a potentially excellent infrastructure development, new global, forward-looking involvement and wider trading outlooks, possibilities.

    Er, will it happen? Hopefully Yes with the Chinese involvement but let us not forget the laborious planning and development hindrances and incompetences that have for instance delayed Larnaca’s international Championship Golf Course by at least 5 years. If it does happen let us hope that it will bring enough new amenities, enhancements and employment opportunities to the Larnaca area to help take-up of the 1,000s of currently empty properties and developments in the Region. Larnaca, particularly, needs, and could reasonably accommodate a major economic boost!

  • Costas Apacket says:

    Wasn’t the old Larnaca airport or some of the land around it, owned by Turkish Cypriots?

  • The views expressed in readers' comments are not necessarily shared by the Cyprus Property News.

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