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Thursday 16th July 2020
Home News Chinese multi-million airport deal collapsed

Chinese multi-million airport deal collapsed

THE PROPOSED multi- million Euro investment by the Chinese firm Far Eastern Phoenix to redevelop the old Larnaca airport has collapsed.

The news was given in a briefing to reporters this morning by government spokesman Stephanos Stephanou. It seems that the company informed the government of its decision to withdraw last week.

“I can confirm that we have received a letter from the Chinese investor that he is no longer interested in the Larnaca project”, Stephanou said.

In March, Far Eastern Phoenix signed an agreement with Hermes Airport to develop the old Larnaca airport with a large commercial showroom for Chinese products and a logistics centre. At a cost of around €600 million, the project was to include exhibition areas, re-import of products and a small conference centre.

According to the agreement, Far Eastern Phoenix would have taken over the management of the area for the next 19 years and to justify its massive investment, the Chinese company wanted to extend the deal for a further 31 years.

At a press conference following the signing of the agreement Mr Iacovou said:

“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”.

He continued “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”.

However, the decision on whether to extend the deal for a further 31 years had to be taken by the island’s government.

But five months later, the government had been unable to decide whether to approve the 31 year extension to the deal or not.

Hermes warned the government in June that its delay could result in Cyprus missing out on the investment altogether. It appears that warning went unheeded.

In this morning’s briefing the government spokesman stressed that this latest development “was as a result of a degenerative war waged on the domestic front”, adding that “some people are obstructing anything from happening in this country”.


  1. Mike.

    A very good assessment and most timely.

    Everyone else.

    What many of us have been battling with over the years is this perception amongst a great many Cypriots that if you say or write anything at all that’s detrimental to the island, you’re automatically accused of being anti-Cypriot and by implication neo-colonialist and that you should “go home”. One sees this so often on the Cyprus Mail website and in other forums. I’ve lost count of the number of times that this has been levelled at me as a result of my surname and each time I’ve had to explain my Cypriot heritage via my mother and that I’ve as much right to express my opinion as the next man.

    The other irritating argument put forward is that “it’s the same in England”. Yet again, I have to point out that there’s indeed corruption and wrongdoing worldwide but that generally speaking in the West there are mechanisms to expose and punish those who transgress, be they Members of Parliament, lawyers or cat burglars. This not the case in Cyprus.

    The difference in Cyprus is that anything goes with presidential pardons being de rigueur, lawyers never being struck off, blatant conflict of interest issues as illustrated with this article and a plethora of other such examples. In short, nobody’s ever brought to account.

    And why? As it’s a small, enclosed society with strong family and personal alliances and no secrets, if anyone’s accused of something he’s plenty of information on everyone else and if he goes down he’ll take others with him. It’s really rather simple.

    And the solution? I would liken the system in Cyprus to that in Sicily (I’ve lived in Italy and have travelled extensively in Sicily so I have some knowledge). The same set of rules apply there vis-a-vis relationships although there’s the added dimension of the Cosa Nostra. When Giovanni Falcone and Paolo Borsellino, two magistrates, dared to take on the Mafia, they were hugely successful in prosecuting and imprisoning hundreds of mafiosi but paid the ultimate price and were assassinated. However, they managed to garner a feeling amongst Sicilians that the system could be changed. A similar groundswell needs to happen in Cyprus and as Nigel has pointed out, there are a certain number of Cypriots who are beginning to speak out. There needs to be far more of them and only then will real change take place.

  2. I agree with the majority of posts re the Bad Apples and all should not be tarnished with the same brush.

    I would however dare to suggest that the difference in Cyprus is that when these rotten apples are caught they are not dealt with by the authorities. It is this fact that tarnishes Cyprus.

  3. Well said Nigel. I guess it is just individual perceptions that make us think that Cypriots are not involved. Like you I have had positive experiences in the main, not in all cases but generally so. How much that is due to speaking the language and being Cypriot is hard to quantify.

    I do know the lawyer I instructed was perfect but to balance that other lawyers he sub contracted work to on my behalf were less so. In fact one of them was an individual I had previously refused to use as he was representing the agent I was buying from at the time. I was surprised. They are all acquainted and know each other and see no wrong in doing so. Others call it a conflict of interests.

    The whole system needs an overhaul if it is felt necessary by the majority but change is a slow moving machine in Cyprus and Cypriots generally will not be led. In fact as I have stated previously, the only way to lead a Cypriot is to find out where he is going and then walk in front of him.

  4. @Curmudgen, @Mike & @Denton – I’ve just looked at the last 30 people who have registered to receive my regular news updates – looking at their names 9 appear to be Cypriot or of Cypriot decent. And I get quite a few emails from Cypriots seeking advice on how to deal with their property related problems (the latest one arrived earlier today).

    So clearly there is much interest in the problems that we are all facing and I know some of my Cypriot friends are trying to do something about them – maybe they are not as voluble as we would like them to be.

    And you cannot tar everyone with the same brush. I had no problems when I bought my land and built my house; my lawyer, architect, main contractor and sub-contractors all did an excellent job – and I know many others who had no problems when buying their house.

    There are bad apples in every barrel (including those who did the attic conversion on our ‘flat’ in the UK after which our bathroom and lounge ceilings collapsed when it rained).

    I’m sure things will change in time – and initiatives such as the one you’ll be part of Denton – George Kounis’ document to the Cyprus government – CPAG – the troika, etc. will all help to achieve that change.

  5. @Mike. Well said, and it reflects my experience. What I do find a bit depressing about this reality is the general resignation, that nothing can be changed. I do know that there are individual Cypriots who want to change things and do try but they keep coming up against the brickwall of sovereign corruption and a corrupted spirit. It’s a chicken and egg problem. Unless and until the supposedly immutable rock of ‘this is Cyprus’ starts to crack, then nothing will change.

    Some serious high flyers have come together in a non-partisan way to try to effect change – I mean people such as Profs Pissarides, Zenios and Panayiotou and some more. A national think tank for change is being established, with which I am privileged to have some association. I do NOT mean the cranks, clowns, attention seekers and self-publicists such as the odd one or two who keep popping up on this and other websites. They are just a vacuous and time wasting distraction.

  6. Curmudgen – There are Cypriots who comment on this site and their opinions are much the same as anyone else’s. Of course there are the slight differences such as title deeds for the house not being such an important issue as they generally have the deed to the land the house is built on. So why add further cost. If buying ready built then it is an issue as it is for anyone else.

    The actions of government are understood but perhaps not so much in a way to cause concern. What will be will be, we tend only to worry about what we know we can control. Yes we understand there is corruption but there is in every country – we just do not have the means or ability to hide it as well as others can. I accept it doesn’t make it right but it is a fact of life.

    Generally I think most thinking Cypriots, apart from the ultra nationalists, do not mind the criticism of the ‘system’ what they do object to is the ‘tarring the people with the same brush as that used to tar government’ that is a game anyone can play with justifiable and legitimate examples on a tit for tat basis not least corruption in the the system of governance in UK from whence most criticism originates. But it serves no useful purpose.

    Sadly too many forget the negative reasons why they left their home countries and in time concentrate on the faults of their host country as against the positives that brought them here. That is a bitter pill to swallow for many Cypriots.

    I criticise at times but would never generalise although I accept it is difficult for an outsider to understand the Cypriot psyche. We are justifiably cautious given millennia of occupation and opportunist too, We have good reason to be as a nation, given our past.

    Hope that helps if only a little.

  7. Comes as NO surprise. Opportunities present themselves and this sad, incompetent government finds incredibly stupid ways of ensuring they are Lost – the Chinese investors will quite sensibly locate their Euro operations elsewhere. Maybe the Cyprus government were focusing too much on how to screw up on the Gas finds and how to mis-manage those whilst parleying and partying with the Euro-elite whilst taking on the Euro Presidency. Soon will surely come the Troika response, mayhem in the banking sectors, withdrawal, with Greece from the Euro and, eventually an Election – and ‘hopefully’ a new focused Government that can at least START addressing the deep-seated problems that have led the country to the very edge of the economic and social abyss.

  8. The end of another long-running comedy! Ah well, that’s life. However, I am certain the government will shortly dream up something new to entertain us all until the curtain finally comes down in February 2013.

  9. It would appear that even if you toady up to your so called ‘Communist buddies’ this doesn’t seem to automatically provide a guarantee that you will seal the deal, especially if your negotiating team and Governmental administration are totally incompetent.

    Welcome to Catastrofias world – home of the lesser spotted brown envelope, conflicts of interest, nepotism, corruption and cronyism.

    Apart from that it’s ok.

  10. Did anybody expect this would come off given the government track record to date? They’re too up their own backsides to see past the parapet.

    As pointed out before in these columns, more than half the nation doesn’t vote so what you get after a general election is more of the same.

    Like us, the young Cypriot (18-30) is equally in despair with the running of the country. They just don’t see the ballot box as an instrument for change so don’t vote.

    Observation. I do wish more Cypriots would join this website so we can get their opinion on the issues. It might change the way we see things i.e. what’s on the other side of the coin.


  11. So what is this government doing? They can’t sort out the economy, the power station, the unions, the lawyers, the banks, the title deed fiasco, the rogue property developers. They are not worried SOMEBODY ELSE IS PAYING. They will hopefully be thrown out on their necks but meanwhile they are lining up jobs for themselves while leaving the mess they have created for someone else to clear up.

  12. How very predictable. Such a shame for an opportunity missed. The sad part is that government sources will feel they have succeeded in something and thereby justify their incompetence. Goodbye jobs!

  13. Don’t worry Gavin, there will be plenty of David Icke type characters off their medications only too willing to parachute into the Presidential Palace to offer their pet solutions to ‘the Problem’ (the current one not the 38 year old one). Remember the Bouncing Yogis with their mind-over-matter-we-can-do-anything twaddle? Any bets on who the first candidate will be to pop his chirpy head up on this blog?

    What a rich melange! Bisque illusionelle a la Stalin avec un soupcon insense au asile.

  14. The saying ‘beggars can’t be choosers’ is not part of the vocabulary in Cyprus.

    Ministers need to ask the question ‘are we offering value for €600 millions’ worth of investment?’ and frame their conditions accordingly.

  15. The Cypriot government have lost a massive opportunity and deal. Those responsible should be removed from the government.

  16. This government is without doubt the worst that Cyprus has had since Independence in 1960: no vision; decisive action never taken when required; disastrous economic policy; Mari; allowing a ship laden with arms to go to Syria; loss of Qatari hotel deal in Nicosia by overvaluing the project’s site. And that’s just for starters.

    We now have the standard excuse for the failure of the old Larnaca airport deal delivered by the government’s propagandist and leading apparatchik, Stefanos Stefanou. If I didn’t know otherwise, I would have thought that he’d been delivering a standard Stalinist text which blamed “dark foreign forces” for undermining the smooth running of the state.

    All too predictable and the modus operandi of this discredited, paranoid government which blames everything on everybody else.

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