The Cyprus government and Hermes Airports have formalised a landmark agreement to initiate the second phase of development for Larnaca and Paphos international airports. Signed at the Presidential Palace, the agreement also resolves longstanding disputes related to the airports’ concession.
Transport Minister Alexis Vafeades described the deal as a critical step in enhancing public interest. The ambitious plan involves simultaneous construction projects at both airports, commencing in late Q1 2025. These works depend on finalising loan agreements with banks and securing necessary planning approvals.
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Minister Vafeades and Hermes CEO Eleni Kalogirou hailed the agreement as transformative for Cyprus’ tourism, local communities, and economy. Currently, both airports collaborate with 55 airlines, connecting Cyprus to 38 countries through 156 routes.
Key Updates And Developments
The upgrades will significantly expand both airports’ capacities:
- Larnaca Airport: Expansion of the terminal by approximately 20,000 square metres, new passenger boarding gates with a connected wing, and increased aircraft parking spaces. Completion is expected within 30 months.
- Paphos Airport: A 30% expansion of the terminal area and extension of the southern parallel taxiway to enhance safety and capacity. Completion is targeted within 27 months.
Upon completion, the airports will collectively serve over 17.4 million passengers annually, a 43% increase from the expected 12.2 million passengers in 2024.
Financial And Legal Agreements
Negotiations resulted in extending the concession agreement by 18 months and settling disputes:
- €30 million in compensation paid by the Republic of Cyprus.
- A €20 million loan from the Republic to Hermes Airports in exchange for withdrawing claims related to the illegal Tymbou airport in the Turkish-occupied north.
- The upgrades impose no additional financial burden on public funds, relying instead on private financing and the concession extension.
Economic Impact
The development builds on the airports’ historical success:
- Larnaca and Paphos airports were constructed with a €640 million investment.
- Over 18 years, the Republic of Cyprus has collected €607 million in concession fees from Hermes Airports.
- The agreement underscores Cyprus’ readiness for further investment and connectivity growth.
The upgrades aim to improve passenger comfort and experience at every stage, adopting modern management practices to handle increasing traffic efficiently.
Airports will serve over 17.4 million passengers annually, bolster Cyprus’ international standing, and foster economic growth without burdening public finances.
