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Cyprus Commits To Comprehensive Waste Site Rehabilitation Amid EU Pressure

by THEFUTURE.TEAM

Turning a New Page in Waste Management

Cyprus is embarking on a definitive turnaround in its waste management practices, with the government prioritizing complete adherence to EU legislation after years of deviation. Following the successful restoration of 52 uncontrolled waste disposal sites in Paphos, Larnaca, and Ammohostos, the focus now shifts to ongoing challenges in Nicosia and Limassol.

Restoration Progress and Persistent Issues

Before 2013, 123 such sites were identified, all of which were decommissioned except for two: Kotsiati (Nicosia) and Vati (Limassol). Both sites ceased accepting waste in 2019. While the restoration of the 52 sites in Paphos, Larnaca, and Ammohostos is completed, procedures are underway for an additional 71 sites—24 in Nicosia and 47 in Limassol.

EU Enforcement Measures and National Commitments

Despite discontinuing operations at these sites, full rehabilitation has not yet been achieved. As a result, the European Commission has escalated the issue by referring Cyprus to the Court of Justice of the European Union, threatening financial penalties for failing to implement the Court’s 2013 directive on the Health and Landfill Waste Directive. The Commission stresses that repeated delays in meeting compliance deadlines continue to jeopardize public health and the environment.

Strategic Blueprint and Budget Allocation

According to plans approved by the Ministry of Agriculture, Rural Development, and Environment, the country is set to rehabilitate 71 sites in Nicosia and Limassol with an allocated budget of approximately €70.8 million. The pace of restoration varies with the complexity of each site. In Nicosia, the largest site at Kotsiati is already underway with a target completion of February 2026, while the remaining 23 sites are slated for completion by April 2026.

Complexities in Limassol and Extended Timelines

Limassol presents the most challenging segment, with 47 sites requiring extensive work. For 19 of these locations, project initiation is expected in early 2026, aiming for summer 2027 completion following delays chiefly due to refugee-related setbacks. The Vati site, along with 27 smaller sites, faces additional complications stemming from the necessity of constructing new infrastructure, including sludge tanks, pump stations, and systems for recovered water utilization. The full suite of projects, including supporting irrigation and storage systems, is projected to conclude by June 2029.

Detailed Contractual Timelines and Future Milestones

The restoration work in Nicosia involves contracts awarded under the supervision of the Technical and Administrative Unit (TAU). The contract for the Kotsiati site was tendered in September 2021, awarded in June 2022, and commenced in August 2022 with a 24-month completion period, aside from ancillary bioenergy projects. For the additional 23 sites in Nicosia, the contract awarded in December 2023 is now expected to finish by April 2026, following a minor extension.

In Limassol, the restoration of 19 sites will progress following the resolution of an appeal process regarding the tender, with operations estimated to begin in early 2026 and completion set for mid-2027. The contract for the Vati site will occupy a prolonged timeline, with final milestones for waste transfer and auxiliary infrastructure anticipated by February 2028 and full completion by June 2029.

Government Assurance and EU Compliance

Despite facing significant technical challenges—especially at Vati—Cyprus remains steadfast in its commitment to laying out a rigorous plan to resolve long-standing issues. This includes addressing legacy delays due to unforeseen complications involving existing sludge storage tanks near the Vati site, which required additional engineering studies and adjustments.

The government emphasizes that meeting these deadlines is critical to avoid further EU sanctions and to end its negative record in waste management. Funded through the Cohesion Policy Programme THALEIA, the projects reflect Cyprus’s commitment to environmental sustainability and responsible waste management.

Regular updates have been provided to the European Commission, detailing the comprehensive action plan and progress measures to ensure that the revised timeline is strictly met, with a key milestone for compliance with Directive 1999/31/EC at February 2028.

Bank of Cyprus Upgrade Signals Fresh Optimism For Greek And Cypriot Banks

by THEFUTURE.TEAM

Regional Banks Enter A More Favorable Cycle

Bank of Cyprus and Eurobank are well positioned to benefit from a renewed re-rating of Greek and Cypriot bank stocks, according to Cyprus-based investment firm Roemer Capital, which upgraded Bank of Cyprus to a buy rating and reaffirmed its positive view on Eurobank.

The firm cited easing geopolitical tensions, resilient economic growth in Greece and Cyprus, lower funding costs and Greece’s expected transition to developed-market status as the main factors supporting the sector.

Roemer Capital also lowered its cost of equity assumptions, updated its forecasts following first-quarter 2026 results and extended its valuation horizon to the end of 2027, raising target prices across its banking coverage.

Bank Of Cyprus Gets The Largest Upgrade

Bank of Cyprus received the biggest revision, with Roemer Capital upgrading the stock from hold to buy and setting a target price of €11.10, implying potential total upside of 27%.

The firm highlighted the bank’s strong capital generation, profitability and projected 100% dividend payout, describing it as the strongest capital-return story among the banks under coverage. Roemer Capital maintained its buy rating on Eurobank, assigning a target price of €4.90 and forecasting potential upside of 28%. The report said the bank is well placed to benefit from loan growth, improving operating performance and merger-and-acquisition synergies.

National Bank of Greece and Piraeus Bank also retained buy ratings, with expected returns ranging from 25% to 36%. Optima Bank was upgraded to buy, while Alpha Bank remained at hold on valuation grounds.

Why Growth Still Sets The Region Apart

According to Roemer Capital, Greek and Cypriot banks continue to benefit from stronger economic fundamentals than many western European peers. The report pointed to faster economic growth, healthier balance sheets, low levels of non-performing exposures, capital ratios approaching 20% and strong customer deposit bases.

Analysts expect performing loans across the sector to grow at a compound annual rate of 6% to 8% through 2028, supported by private investment, digitalisation, green manufacturing, supply-chain expansion and a gradual recovery in household lending.

The report also said the conclusion of lending under the EU Recovery and Resilience Facility is unlikely to materially affect credit growth, as banks have already shifted back towards traditional commercial lending. Roemer Capital expects Euribor to remain between 2.2% and 2.5%, a level it believes should support both lending activity and net interest margins.

Geopolitics, Valuation And Market Structure Support The Case

The report said improving geopolitical conditions have strengthened the investment outlook, noting that Brent crude prices have largely returned to pre-war levels while Greek government bond yields have stabilised at around 3.5%. Although geopolitical risks remain, Roemer Capital believes the likelihood of a major inflationary shock or significant pressure on bank profitability has eased.

Another important catalyst identified by the firm is Greece’s expected promotion to developed-market status by FTSE Russell, STOXX and MSCI over the coming months.

According to the report, the reclassification should improve liquidity and attract a broader base of international investors. Roemer Capital also said Euronext’s acquisition of the Athens Exchange is expected to strengthen market infrastructure and increase international visibility, particularly for Bank of Cyprus and Optima Bank.

The firm noted that Bank of Cyprus has already benefited from its Athens listing, with average daily trading value increasing from less than €400,000 before its September 2024 move to nearly €6 million afterwards.

Economic Momentum Remains A Core Tailwind

Roemer Capital said both Greece and Cyprus have moved beyond post-crisis recovery and are now supported by private-sector-led growth. For Cyprus, the report highlighted recent tax reform and efforts to simplify the legal and regulatory framework, while also noting that limited foreign banking competition continues to support domestic lenders.

Overall, Roemer Capital expects Greek and Cypriot banks to remain well-positioned for profitable loan growth over the coming years.

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