The Cyprus Ports Authority, until recently confined to the role of owner and state regulator of the island’s main ports, is back in the management game after the government cancelled the Larnaca port and marina concession last April and assigned the project to a consortium of local authorities.
The CPA is resuming management of the port for the next six months, while the marina, in recent years administered by the deputy ministry of tourism, will now be handed over to the Cyprus Marine and Maritime Institute (CMMI), the research, innovation and technology development centre, in which Larnaca municipality is a shareholder.
On Tuesday, the consortium met at the Presidential Palace after which Transport Minister Alexis Vafeades announced that he would invite the Greek state asset development fund (HRADF) to conduct a survey on the future operation and viability of the project.
The HRADF will be assigned the study for an undisclosed sum and without tender. It should be delivered within six months.
Minister Vafeades said this would be in the public interest as it would save valuable time in getting the project up and running again, and that “it would cost as much as if we awarded the survey to a foreign expert”.
He said that the HRADF’s ports development agency would undertake the survey under a bilateral cooperation agreement, while Larnaca mayor Andreas Vyras added that the new concession could be awarded to a private enterprise, or even back to the Ports Authority.
Vyras added that the municipality will go out to tender for the management of the yacht club.
Since the commercialisation of Limassol port on January 29, 2017, handing over its management to P&O Maritime, DP World Limassol and Eurogate Container Terminal as part of a 25-year deal worth €1.9 bln, the CPA was stripped of its management rights.
In Larnaca, it served the last vessel on March 31, 2022, before the transfer of the port to the investor, Kition Ocean Holdings, as part of a 40-year, €1.2 bln redevelopment plan. It would include a 650-yacht marina and upgrade the port to accommodate ships up to 450 metres in length, such as luxury cruise ships, energy exploration vessels, military, and other merchant ships.
The Israeli-controlled KOH would have also revamped the Larnaca seafront with a residential and commercial complex, including a yacht club, restaurants and high-rise apartments, creating 4,000 new jobs, and generating €12 bln in revenues for the state.
Financing and labour troubles
However, after taking over the port and marina area in December 2020, KOH struggled with financing, labour issues and rising port tariffs, exacerbated by the coronavirus-imposed shutdowns.
Talks between the state and Kition reached a deadlock in mid-April 2024, despite a compromise deal agreed in the presence of President Nikos Christodoulides, allowing the company to provide a letter of guarantee of €4.2 mln, instead of the €10 mln that the state required.
The government later had a change of heart and opted, instead, to declare the concession null and void.
Vafeades said after Tuesday’s meeting that once the survey is approved by all stakeholders, the aim would be to seek an investor, not an operator.
At the same time, dredging works and further expansion of the marina will continue as planned, as will the architectural competition for the yacht club and the landscaping of the area, in order to connect to the Phinikoudes promenade.
At present, the CPA is the owner of six ports – the new Limassol port, old Limassol port, Larnaca port and marina, Paphos harbour, Latchi harbour and Zygi/Vassiliko marine zone.
Last December, the government cancelled a 2019 decision and reassigned the Vassiliko operation back to the CPA, supervising the VTTV crude oil jetty, MA Skyra Vassas concrete and cement jetty, and the EAC Vassiliko oil and gas terminal.
