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Government Commitment To €125 Million For Crete-Cyprus Electrical Link Raises Fiscal And Geopolitical Concerns

Mounting Financial And Legal Uncertainties

A recent official announcement by ALMA has spotlighted the contentious financial and geopolitical implications of the Crete-Cyprus electrical interconnection. Amid intense pressure on the Cyprus Regulatory Authority of Energy (RAEK), the body responsible for the project’s implementation is currently seeking recognition of expenses nearing €300 million. This financial assessment, pivotal to the government’s eventual commitment, would initially trigger an obligation to pay €125 million—distributed over five years as per the September 2024 bilateral agreement between Cyprus and Greece.

Discrepancies In Government Accountability

Beyond the fiscal complexities, the process is mired in questions about governmental governance and accountability. Criticism has emerged over the apparent reliance on disputed interpretations of data provided by ADEME and the absence of independent studies. The decision has further stirred controversy as dissent exists among senior officials—evidenced by discord between the Finance and Energy Ministers—and even extends to the President, who has refrained from accepting responsibility for such a significant governmental commitment. Such internal disagreements cast doubts on the capacity of the administration to deliver a robust and responsible long-term strategy.

Historical Precedents And The Call For Decisive Action

The current predicament echoes earlier decisions made by the Anastasiades-DISY government, which advanced the project without adequately addressing emerging technical challenges, economic sustainability, and the inherent geopolitical risks—including potential disruptions by Turkey. Alongside these issues, investigations by the European Public Prosecutor are examining past transactions and the dubious outsourcing of the project to a company deemed unsuitable to handle such a large-scale endeavor. These factors have compounded public concern over the future liabilities faced by taxpayers should the project be abandoned.

Conclusion: Necessity For Clear, Prompt Decision-Making

In light of the escalating financial exposure and geopolitical complexities, it is imperative that both the government and RAEK adopt a transparent, comprehensive approach to determining the fate of the Crete-Cyprus interconnection. Delay risks not only increasing the potential compensation claims but also undermining investor confidence and the strategic ties with both Greece and the European Union. Ultimately, a decision founded on rigorous, independent analysis will be crucial in safeguarding national interests and maintaining fiscal responsibility.

Cyprus Residential Market Surpasses €2.5 Billion In 2025 With Apartments Leading the Way

Market Overview

In 2025, Cyprus’ newly built residential property market achieved a remarkable milestone, exceeding €2.5 billion. Data from Landbank Analytics indicates robust activity countrywide, with newly filed contracts reaching 7,819, including off-plan developments. This solid performance underscores the market’s resilience and dynamism across all districts.

Transaction Breakdown

The apartment sector clearly dominated the market, constituting 81.6% of transactions with 6,382 deals valued at €1.77 billion. In contrast, house sales represented a smaller segment, encompassing 1,437 transactions and generating €737.9 million. The record-high transaction was noted in Limassol, where an apartment sold for approximately €15.2 million, while the priciest house fetched roughly €6.2 million.

Regional Analysis

Nicosia: The capital recorded steady domestic demand with 2,171 new residential transactions. Apartments accounted for 1,836 deals generating €349.6 million, compared to 335 house transactions worth €105.5 million, anchoring Nicosia as a core market with average values of €190,000 for apartments and €315,000 for houses.

Limassol: As the island’s principal investment center, Limassol led overall activity with 2,207 transactions. Apartments dominated with 1,936 sales generating €824.1 million, while 271 house transactions added €157.9 million. The district enjoyed premium pricing, with apartments averaging over €425,000 and houses around €583,000.

Larnaca: This district maintained robust activity with a total of 2,020 transactions. The apartment segment realized 1,770 transactions worth €353 million, and houses contributed 250 deals valued at €96.3 million. Average prices hovered near €200,000 for apartments and €385,000 for houses, positioning Larnaca within the mid-market bracket.

Paphos: With a more balanced mix, Paphos completed 1,078 transactions. Ranking second in overall value at €503.2 million, the district saw house sales generate €287.8 million and apartments €215.4 million. Consequently, Paphos achieved the highest average house price at approximately €710,000 and an apartment average of €320,000, emphasizing its premium housing profile.

Famagusta: Distinguished by lower transaction volumes, Famagusta was the sole district where house sales outnumbered apartment deals. Out of 343 transactions, 176 involved houses (yielding €90.4 million) and 167 were apartments (at €32.4 million). The segment’s average prices were about €194,000 for apartments and over €513,000 for houses, signaling its focus on holiday residences and coastal developments.

Sector Insights and Forward View

Commenting on the report, Landbank Group CEO Andreas Christophorides remarked that the analysis demonstrates an ecosystem where apartments are the cornerstone of the real estate market. He emphasized, “The apartment sector is not merely a trend; it is the engine powering the country’s real estate market.” Christophorides also highlighted the diverse regional dynamics: Limassol leads in apartment pricing, Paphos commands premium house prices, Nicosia remains pivotal to domestic demand, Larnaca sustains competitive activity, and Famagusta caters to holiday home buyers.

In a market characterized by these varied profiles, informed monitoring of regional and sector-specific dynamics is crucial for investors aiming to make targeted and strategic decisions.

Uol
The Future Forbes Realty Global Properties
Aretilaw firm
eCredo

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