The Cyprus Ministry of Transport, Communications and Works and Hermes Airports has signed an agreement for the phase two construction works, and settlement of disputes related to the concession agreement for two international airports.
This agreement, following months of negotiations, outlines projects for Larnaca Airport and Paphos Airport while resolving long-standing disputes between the parties.
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The construction works at both airports are scheduled to begin by the end of the first quarter of 2025.
This timeline is contingent upon finalising loan agreements between Hermes Airports and financing banks, as well as obtaining necessary planning consent.
The agreement also extends the concession agreement by 18 months and includes a €30m ($31.17m) compensation payment.
Additionally, a €20m ($20.7m) loan from the Republic of Cyprus to Hermes Airports has been agreed upon in exchange for withdrawing claims related to the operation of Tympos Airport.
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By GlobalDataCyprus Transport, Communications and Works Minister Alexis Vafeadis said: “The dynamic of the increase in passenger traffic that we achieved through joint coordinated efforts with Hermes Airports, the Deputy Ministry of Tourism and our partners in the tourism sector have made the expansion works of the two airports necessary.
“We are satisfied that we have managed to reach an agreement with Hermes Airports, which is important both for the long-term development of the Airports and the securing of new air routes, further consolidating Cyprus’ position on the international stage and the development of the economy.”
For Larnaca Airport, the projects including expanding the terminal building by approximately 20,000m2, constructing new passenger gates, and increasing aircraft parking spaces are expected to be completed in 30 months.
At Paphos Airport, the building area is set to increase by approximately 30%.
The southern parallel taxiway will be extended to improve runway safety and capacity.
These enhancements are projected to be completed within 27 months from commencement.
The expansions at Larnaca and Paphos airports will enable them to serve over 17.4 million passengers, a 43% percent increase compared to the 12.2 million expected this year.
Hermes Airport chairman of the board of directors Christophe Petit said: “We are happy about the positive outcome of this negotiation, which is mutually beneficial and will offer solutions to chronic issues.
“Larnaca and Paphos airports were built with an investment of around €640m ($665m), while the Republic of Cyprus has collected over €607m ($630.8m) in concession fee revenue during the 18 years that Hermes Airports has been managing them.”
The enhancements are expected to boost connectivity and tourism in Cyprus, benefiting the local economy.
