The government has signed an agreement with Hermes Airports for a €170 million expansion of Larnaca and Paphos airports, officials said Monday.
Work is expected to begin by March 2025.
The infrastructure projects will take 30 months to complete at Larnaca airport and 27 months at Paphos airport. Hermes has secured financing from local banks for the developments, which will increase passenger capacity by 70% once completed, according to government sources.
Under the new agreement, Hermes will continue to manage both airports for an additional 18 months beyond the current contract’s expiry date of 31 May 2031, extending operations until 2033. The state will pay €30 million in compensation claims to Hermes, significantly less than the €430 million initially demanded by the company for losses during the coronavirus pandemic and the Ukraine war.
Transport Minister Alexis Vafeades told Phileleftheros the deal was favourable for the state and would bring enormous benefits to Cyprus. Government spokesman Constantinos Letymbiotis described it as “a strategically important development” that secures the Republic’s interests while modernising its airports.
The agreement differs significantly from a 2022 memorandum negotiated by the previous administration, which former Auditor General Odysseas Michaelides had criticised as unfavourable to the state. The new deal includes Hermes waiving compensation rights related to the operation of the illegal Tymbou airport in the occupied territory.
Key benefits include immediate commencement of works with improved design, enhanced passenger service capacity, better connectivity, increased competitiveness, job creation, and additional state revenue from commercial activities, government sources said. The expansion works will be delivered in phases and are designed to meet the latest standards.
The Central Committee for Changes and Claims (CCCC) approved the agreement before its signing at the Presidential Palace.
