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Cyprus To Build €17 Million Reservoirs For Irrigation Supply

Addressing Critical Irrigation Needs

The Department of Water Development has embarked on a transformative project in the Vathiagia area, destined to resolve the irrigation challenges faced by hundreds of farmers. With a budget of €17 million, the initiative involves constructing two massive earthen reservoirs with a combined capacity of 3,000,000 cubic meters. These reservoirs will store reclaimed water from the Mia Milia intercommunal treatment facility, ensuring a reliable supply during the winter months.

Modernizing Infrastructure In Tandem

The project is being developed alongside the upgrade of the main sewage pipeline in Mia Milia, replacing infrastructure that has been in place since 1972. Funded by the European Union and implemented by the Nicosia District Administration in coordination with state authorities, the upgrade will allow treated water to be redirected to government-controlled areas, including the Kaimakli Industrial Zone. Daily supply is expected to reach around 21,000 cubic meters by the end of the year.

A Comprehensive €80 Million Infrastructure Plan

The reservoirs form part of a broader €80 million programme that also includes pumping stations, transfer pipelines and expanded irrigation networks across Mesaochia, Dali and Athienou. Current demand is estimated at 4.5 million cubic meters, while the new infrastructure is expected to increase annual supply to more than 10.1 million cubic meters, supporting further agricultural activity.

Benefiting Communities And Enhancing Resource Management

Farmers in Idalio, Potamia and Limbi are expected to benefit directly, while municipalities such as Gerio and Latsia will use reclaimed water for green areas. The water is suitable for most crops, with the exception of leafy vegetables and produce consumed raw.

A Model Of Cross-Community Cooperation

The operational costs of the Mia Milia Treatment Plant are split 70% for the Republic of Cyprus and 30% for the Turkish Cypriot community. This arrangement stands as a concrete example of shared resource management. Correspondingly, 70% of the generated reclaimed water, equating to 21,000 cubic meters daily, will be transported via pipeline to the new reservoirs in Vathiagia.

Environmental Commitment And Renewable Energy Integration

The site previously contained industrial waste reservoirs, which required an environmental assessment. Elevated levels of nickel and zinc were identified in the soil, leading to an on-site remediation process costing €370,000. The treated soil will be reused in construction, while photovoltaic systems are planned to support energy needs and reduce operational costs.

Supporting Biodiversity And Circular Economy Initiatives

Located near the Natura 2000 area “Alykos Potamos – Agios Sozomenos,” the project has been assessed to ensure limited environmental impact. The reservoirs are expected to provide a consistent water source for local bird populations. At the same time, the use of reclaimed water supports broader efforts to reuse wastewater in agriculture.

Ongoing Coordination With Local Stakeholders

Planning has involved consultations with farmers and local authorities to align infrastructure development with local needs. Construction is expected to begin once permits are issued, starting with the eastern reservoir, with a capacity of 1.4 million cubic meters.

Looking Ahead

Upon completion, this project marks a significant step forward for Cyprus. It not only enhances water resource management but also reinforces a collaborative framework for shared natural resources. Cyprus is poised to transform wastewater into a valuable ally in agricultural sustainability and economic growth.

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

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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