AGP Executive Report

Energy & Industry Deal: Eni has awarded Houston-based McDermott a major subsea contract (Cronos gas development offshore Cyprus), pushing the project into execution with first gas targeted for 2028. Regional Diplomacy for Business: President Christodoulides heads to El Alamein for the Cyprus-Greece-Egypt trilateral summit, with energy and defence cooperation high on the agenda. EU Policy Pressure: Brussels is weighing new EU budget funding sources tied to pollution and poorly collected electronics—raising the stakes for Cyprus, which collects the lowest e-waste per person in the EU. Hospitality Expansion: TGI Fridays™ signs with Devolli Group for its first Balkans expansion into Kosovo, Albania and North Macedonia. Primary Sector Support: Christodoulides announces €1.5m for two agricultural projects to offset higher costs of oil and fertilisers. Tech & Jobs: BrainRocket closes its Limassol offices and offers relocation abroad, effectively ending its Cyprus presence. Trade Links: Cyprus and Bahrain move to deepen maritime cooperation after port-level talks at Khalifa Bin Salman Port. Tourism Access: Paphos starts mapping accessibility gaps across tourism infrastructure, aiming for an integrated plan by mid-2027. Tax & Investment Risk: AmCham Cyprus warns Pillar Two minimum tax rules could affect US investment decisions and jobs. Property Market: Cyprus property sales keep growing in August, with Limassol and Paphos driving most of the increase.

Maritime Cooperation: Cyprus and Bahrain discussed stronger bilateral maritime ties during a delegation visit to Khalifa Bin Salman Port, focusing on logistics frameworks, port management modernisation and digital service integrations. UK-EU Angle: UK Prime Minister Andy Burnham told President Nikos Christodoulides the UK intends to “get closer” to the EU, while also flagging de-escalation efforts around the Strait of Hormuz. Energy Grid Stakes: Cyprus Energy Minister Michalis Damianos insisted the Great Sea Interconnector will pass through Cyprus, after reports raised fears of alternative routing that could leave the island out. Shipping Safety & Recovery: Turkey said nine ships and 11 aircraft are involved in the search for missing people after the Kyrenia ferry disaster, with an investigation underway and crew detained. Agriculture Policy: The EU confirmed no CAP payments go to farmers in areas not controlled by the Republic of Cyprus, citing foot-and-mouth measures and administration via the island’s CAP Strategic Plan. Household Costs: Cyprus borrowers may face another mortgage hit as markets expect an ECB rate rise, with variable-rate loans most exposed. Business & Finance: Theon International published its H1 2026 report, reporting 35.4% revenue growth and an €325m syndicated financing facility coordinated by Alpha Bank.

Fuel Costs Watch: Cyprus consumer protection warns fuel prices could rise again, citing recent increases in petrol, diesel and heating oil, with government discussions on measures expected by Sept. 17. Jobs & Growth Signals: Cystat reports Cyprus employment up 1.7% year-on-year in Q2 2026, with the biggest gains in wholesale/retail trade and construction. Electricity Market Scrutiny: A call for an independent audit of Cyprus’ electricity value chain argues solar returns can’t be judged in isolation and urges a wider look at who benefits across the grid. Shipping Rules in Limbo: IMO talks in London ended without a new net-zero shipping text, pushing key MARPOL Annex VI details to further negotiations in November—keeping uncertainty high for Cyprus shipping. Maritime Cooperation: Cyprus and Bahrain sign an MoU to expand maritime safety, training, search-and-rescue and innovation, with joint working groups planned. Energy Investment Angle: Cyprus’ role as a strategic iGaming hub and local energy developments also feature, alongside coverage of Cyprus’ solar power economics. Regional Diplomacy: Herzog’s Sept. 10 visit to Cyprus highlights deepening Israel-Cyprus ties amid wider Eastern Mediterranean tensions. Finance & Banking Mood: UBS flags strong potential in Greek banks, relevant to Cyprus via Eurobank and Alpha Bank operations.

Regional Security & Energy: Cyprus, Greece and Egypt are set for a trilateral summit in El Alamein on Sept 8, with defence, energy cooperation and Turkey’s “revisionist” posture on the agenda. Electricity Interconnector Watch: Energy Minister Michalis Damianos says the Great Sea Interconnector is “progressing as planned” and will pass through Cyprus, while officials discuss costs and how to limit the impact on Cypriot consumers. Fuel Price Relief: Government talks are underway on extending measures to keep fuel costs down, with decisions due by Sept 17 and tax reductions expected to continue after Sept 18. Labour & Pay Policy: A minimum wage bill is headed to parliament by year-end, alongside plans for salary transparency and stronger collective bargaining. Worker Protection: Labour ministry moves to crack down on illegal employment. Agriculture Under Pressure: Farmers in the Chrysochous valley plan a road protest over irrigation interruptions, warning of irreversible damage to crops and the environment. Schengen Push: Cyprus’ Schengen bid is back on the EU agenda after President Christodoulides’ meeting with Antonio Costa, aiming for a political decision “as soon as possible.” Maritime Tragedy: The Kyrenia ferry disaster toll rises, with a 14th body recovered and 14 still unaccounted for as search-and-rescue continues.

Minimum Wage Push: Cyprus’ Labour Minister Marinos Mousiouttas says a minimum wages bill will go to Parliament by year-end, after legal review to align with EU rules, with salary transparency and stronger collective bargaining steps also planned. Energy Grid Tension: Nicosia is facing mounting pressure over its energy plans, with reports that the Great Sea Interconnector is losing support and opposition demanding official answers. Schengen Momentum: President Christodoulides’ push for a political decision on Cyprus’ Schengen bid is back on the EU agenda, with potential knock-on benefits for tourism, investment and business mobility. Ferry Disaster Fallout: After the Kyrenia-area FiloJet capsizing, the death toll has risen to 13 and 15 remain missing, as families demand answers over safety and regulatory gaps. Agriculture Under Strain: Farmers in the Chrysochous valley plan public action over irrigation disruption, warning the lack of water could hit crops and the local environment. Pensions Critique: A new pension reform assessment argues Cyprus’ social security changes are too low and unsustainable, with limited room to lift vulnerable people out of poverty. US-Cyprus Diplomacy: US ambassador-designate John Breslow has arrived in Cyprus to begin credentials with President Christodoulides, bringing a business-and-politics background to the role.

Energy & Grid Reform: A new debate is heating up around Cyprus’ electricity prices, with calls to “open the entire electricity bill” and commission an independent audit across the whole value chain—generation, fuel, renewables, networks, balancing, suppliers, regulated charges and investor returns—after disputes over solar park pricing. Offshore Gas Strategy: Cyprus’ “energy paradox” remains central: promising offshore gas sits alongside an isolated grid and rising limits on absorbing solar power, raising the question of how Nicosia can turn resources and export links into durable regional influence. Renewables & Regulation: Separate coverage highlights Cyprus’ growing renewables push and the need to clarify who produces, sells and sets prices in the RES market as the system struggles to keep costs down. Tech & AI Policy: Cyprus’ Computer Society submitted recommendations to strengthen the National AI Strategy 2032, urging clearer, measurable delivery rather than broad ambitions. Innovation & Property Tech: VC firm 33East backs Piney, a Cyprus-founded property operations startup expanding from Europe into the US, using Cyprus as a “proving ground.” Shipping & Safety: The ferry disaster off Kyrenia continues to unfold, with the death toll rising to 13 and 15 still missing as rescue teams locate the wreck. Diplomacy & Business Links: US ambassador-designate John Breslow has arrived in Cyprus to begin credentials talks, bringing an industrial-gases business background into the role.

Energy & Industry Policy: Cyprus President Nikos Christodoulides says the government is in talks with energy giants over new natural gas drilling blocks in the EEZ, aiming to complete the Vasiliko LNG terminal and build an alternative energy corridor with Egypt and Israel. Electricity Costs Debate: A local initiative to cut electricity prices by 20% has triggered a push to “open the entire electricity bill” and conduct an independent audit across the whole value chain. AI Strategy & Tech Sector: The Cyprus Computer Society submitted 33 recommendations to strengthen the National AI Strategy 2032, urging measurable, practical delivery. Renewables & Investment Signals: Cyprus-based VC 33East backs Piney, a property operations startup expanding from Europe into the US (Miami launch), highlighting Cyprus as a “proving ground.” Maritime Focus: SMM 2026 in Hamburg put maritime security and resilience front and centre, with emphasis on unmanned systems, sensors, cybersecurity and faster procurement. Cyber & Payments Risk: FTC action targets Nuvei over merchant screening failures tied to tech support scams, with Cyprus-linked acquiring bank registration mentioned.

Energy & Gas: President Nikos Christodoulides said Cyprus is in talks with energy giants to secure rights for new natural gas drilling blocks in its EEZ, aiming to build an alternative eastern Mediterranean energy corridor for Europe and push forward Vasiliko LNG plans. Infrastructure & Flood Resilience: Nicosia’s district authority (EOA) is set to start a €2.26m stormwater culvert repair under Digeni Akrita Avenue, reinforcing a 50-year-old structure to reduce flooding risk and protect road safety. Industrial Performance: Cystat reported Cyprus’ industrial turnover index rose 3.5% in June 2026, with manufacturing up 3.6% and strong gains in wood products and textiles. Construction Workforce: Employers’ federation Oseok says Cyprus is looking to Egypt and India to replenish construction labour as workers leave under the Syrian repatriation scheme. Payments & Fintech Compliance: FTC action against Nuvei highlights fraud risks in merchant processing, with the case noting Cyprus-linked acquiring bank involvement. Maritime Security & Tech: SMM 2026 in Hamburg put maritime security and resilient supply chains front and centre, spotlighting unmanned systems, sensors and cybersecurity. Innovation Ecosystem: Plug and Play Cyprus will host its first innovation expo in Limassol on Nov 11, showcasing startups from its inaugural cohort. EU/Policy for Business: EU leaders discussed new “own resources” and taxes for the next budget, a backdrop for competitiveness and migration talks that also featured Cyprus’ Schengen bid.

Immigration & Compliance: Economy and Labour Minister Jason Hayward says Cyprus lacks a clear framework to define and investigate “sham marriages” tied to immigration or other legal benefits, and proposes giving the registrar a referral route to immigration for assessment and possible investigation, with false unions risking refusal or revocation of benefits. EU Politics & Cyprus Problem: President Nikos Christodoulides met EU Council President Antonio Costa as Schengen and the Cyprus issue topped talks, with Costa stressing reunification as an EU priority and readiness to support UN-led efforts. Tax & Business Climate: Finance Minister Makis Keravnos rejects claims of a corporate exodus under the OECD Pillar Two 15% minimum tax, saying it targets only very large groups (over €750m revenue) and not every company. Energy & Inflation: An economist says Cyprus’ latest inflation rise is driven mainly by imported energy costs, with petroleum products and electricity leading the jump. Agri Pressure: Farmers at Strovolos market complained about water distribution and subsidy delays, urging the agriculture ministry to secure supplies and support. Automotive Imports: Geely will enter Cyprus in 2026 via KKS Mobility, launching three electrified models (E5, E2, and Starray EM-i). Payments & Fintech: SPAYZ.io will bring its Africa-focused payment localisation push to Forex Expo Dubai 2026, expanding local routes across multiple countries. Shipping Safety: Reports from the Kyrenia ferry disaster claim the crew “locked the doors” to the passenger cabin as water entered, while the captain and first mate reportedly jumped off early. Industrial Prices: Eurostat data shows Cyprus industrial producer prices rose 2.3% month-on-month in July, among the highest EU increases, largely energy-led. Tech & AI Governance: The Cyprus Computer Society calls for measurable delivery in the National AI Strategy 2032, pushing clearer accountability and practical implementation.

Property Curbs: Cyprus MPs and the Interior Minister revisited proposals to restrict foreign nationals’ land purchases, aiming for tighter checks, more transparency, and limits around agricultural zones, the ceasefire line, critical infrastructure, and plot/residence size. EU Budget Pressure: European Council President António Costa warned EU governments face a choice on new levies for 2028-2034 or accept cuts to security, defence, competitiveness, farming and cohesion funding. Energy Interconnector Scrutiny: Opposition Akel asked how Meridiam’s entry into the Great Sea Interconnector (GSI) affects Cyprus’ cost, viability and consumer impact, including whether Cyprus will invest €100m equity. Banking Rates Watch: Cyprus loan rates broadly track the euro area median, but deposit rates remain the lowest, with CBC pointing to bank liquidity and market size. Inflation Update: Cyprus inflation accelerated to 3.5% in August, driven by higher transport charges, with the highest rate since Sept 2023. Maritime Safety Questions: New testimony in the Kyrenia ferry disaster case says the vessel left despite reports of unsafe conditions and a closed Turkish port, raising fresh accountability concerns.

Inflation Watch: Cyprus inflation quickened to 3.5% in August as fuel and air fares pushed up transport costs, with petroleum products and agricultural goods also rising. Labour Market: Registered unemployment climbed 7.2% in August, driven largely by public administration and education, lifting the seasonally adjusted figure to its highest since Aug 2024. Workplace Compliance: The labour ministry announced September inspections targeting illegal employment in industry, with fines starting at €1,000 per undeclared worker (rising for repeat offences). Shipping & Tech: Cyprus showcased home-grown maritime technology at SMM Hamburg, pitching tools for safer, cleaner, more efficient shipping as rules tighten. Energy & Industry: Eurostat data showed EU industrial producer prices up in July, with Cyprus among the biggest monthly risers (+2.3%). Business & Services: Professional services grew while accommodation and support services fell in Q2, and Cyprus hotel leaders said they’re aiming to limit 2026 losses to around 10% after stronger July-August bookings. Corporate & Finance: Cyprus deposit rates still lag Europe despite strong local liquidity growth, while Jumbo reported solid August sales momentum. Energy Policy: Cyprus’ energy ministry-linked delegation is set to attend the Southeast Europe Energy Forum in Thessaloniki, focused on energy security, affordability and the next phase of the transition. Maritime Incident: Rescue efforts continue after the Kyrenia ferry disaster, with deep-diving drones reaching the wreck and authorities detaining suspects in the wider probe.

Energy Security & Trade Controls: A new U.S. presidential order bans imports of “bulk-power” equipment from “covered foreign entities,” listing Cyprus among them until Sept. 30, 2026, with the U.S. Dept. of Energy tasked to draft rules. Defense & Regional Industry: Israel and Greece signed the €3.0bn “Achilles Shield” air-defense deal, with Cyprus already referenced as part of the Eastern Mediterranean alliance, underscoring a fast-moving defense procurement race. Cyprus Power & Renewables Compliance: EAC says it found 110 suspected irregular photovoltaic installations at commercial sites since June; 22 were confirmed and disconnected, raising safety and grid-curtailment concerns. Local Economy & Construction: Cyprus economy grew 3.3% in H1 2026 (construction and trade among key drivers) while the state recorded a €770.6m surplus. Sports & Training Talent: Coral Cyprus backed University of Cyprus Formula Racing Team (FRTUCY), which placed 2nd overall at Formula Student Romania 2026. Governance & Licensing: An audit flags that over 1,000 gyms may be operating without CSO licenses, pointing to weak inspection enforcement. Shipping Safety: Turkey’s Marmara Sea collision off Istanbul left 10 crew missing, highlighting ongoing maritime risk.

Retail Relief: Lidl Cyprus is cutting prices on 60+ essential products throughout September, aiming to ease household budgets amid inflation. Sea Safety Push: After deadly rough-sea incidents, the Cabinet approved interim rules letting authorities stop vessels leaving Cyprus waters and order safer anchorage/port, plus an Anchorages Committee to coordinate responsibilities until a coastguard is fully set up. Storm Aid: Financial assistance was approved for August 29 extreme weather, including uninsured homeowners (up to €20,000 structural damage), equipment caps, and support for uninsured business premises and vehicles. Tourism Watch: Cyprus hotels are targeting around 10% losses for 2026 after a tough spring and improved July-August bookings. Biotech Manufacturing: Medochemie and Theramir signed a collaboration to build GMP capabilities and accelerate next-gen biological therapy manufacturing in Cyprus and south-eastern Europe. Payments Upgrade: Cyprus is moving toward an interbank service for transfers using only a recipient’s mobile number, planned for Q1 2027. Cyber/Industry Risk: A Russian hacker extradited from Cyprus faces US charges over an Excel malware campaign that hit about 80,000 users. Energy/Trading: easyMarkets launched 24/7 Gold24, Silver24 and Oil24 CFDs, reflecting continued demand and geopolitical-driven volatility.

Maritime Safety & Accountability: Cyprus’ shipping crisis deepened as search-and-rescue teams continued locating people missing after the Kyrenia ferry disaster (Filo Jet), with the wreck reportedly found at about 550m and the captain and crew arrested; authorities also moved toward stricter rough-weather sailing rules and a new Coast Guard framework. Energy Costs & Policy: The government outlined a €174m support package (2027-2032) to shield vulnerable households from higher transport fuel costs under EU rules, with compensations starting a year early. Tourism Pressure: Cyprus recorded the EU’s steepest fall in tourist overnight stays in the first half of 2026 (-7.7%), raising concerns for hotels, transport, and local services. Economic Reality Check: Cyprus’ economy grew 3.3% in Q2, but the data also show growth isn’t automatically translating into household pockets. Inflation Watch: Cyprus inflation hit 5.2% in August, among the highest in the euro area, driven largely by energy. Property Market: Foreign buyers accounted for 41.3% of Cyprus property sale contracts in Jan-Jul 2026, reshaping competition in coastal districts. Retail & Consumer Relief: IKEA Cyprus cut prices on 300+ products by up to 25%, aiming to ease household spending pressure. Food & Trade Link: EU-backed EUKIHAL is bringing Cyprus halloumi and Greek kiwifruit to Miami for B2B tastings, spotlighting supply-chain traceability and EU compliance.

Macroeconomy & Costs: Cyprus inflation jumped to 5.2% in August (fourth straight monthly rise), with energy again the key driver, while the euro area also saw inflation accelerate as energy costs surged. Fuel & Transport: Cyprus will extend the fuel tax cut by keeping the €0.083/litre reduction in place until end of November, avoiding a price shock after the Sept. 17 expiry. Construction & Industry Growth: Cyprus economy grew 3.3% year-on-year in Q2 2026, led by construction (up 5.4%) plus stronger wholesale/retail, tech and financial services. Retail Demand: Retail turnover surged in July (+11% value, +8.9% volume), with big gains in household equipment and non-store channels. Housing Policy: An EU proposal could let Cyprus restrict Airbnb-style short-term rentals in “housing stress” areas, but only after authorities map where pressure exists. Shipping Decarbonisation: Cyprus is back at the centre of IMO talks in London over global rules for ship emissions and a possible Net-Zero Fund. AI for Inclusion: Cyprus’ National AI Strategy consultation focused on using AI to improve access for people with visual and hearing disabilities, including navigation and accessible document conversion. Property Market: Larnaca led Cyprus property gains in Q2 2026, especially for apartments. Business & Consumer Tech: Ikea announced a €1.2bn Europe price-cut plan, and Ikea Cyprus is set to apply reductions via its local franchise operator. Maritime Safety: Separate probes are underway into the Cape Greco boat tragedy, including the death of businessman Dimi Mavropoulos and the sinking of the passenger yacht Petsas I.

Cyprus Economy: Cyprus posted a €770.6m general government fiscal surplus in the first seven months of 2026 (2.0% of GDP), as revenue growth outpaced spending, with VAT and income/wealth taxes driving the improvement. Storm Impacts: After last Friday’s severe weather, Cyprus reported damage to 183 homes (mainly in Nicosia) and crop losses assessed by agriculture inspectors, while authorities urged affected residents to submit claims with photos. Maritime Safety & Accountability: The Northern Cyprus ferry disaster continues to dominate the week: rescuers are still searching for missing passengers after the Filo Jet capsized off Kyrenia/Girne, and the captain plus seven crew members have been arrested as investigations proceed. Energy Infrastructure: Greece’s foreign minister says Turkey’s approval is not required for the Great Sea Interconnector (GSI), with work potentially able to restart before end-2026—an important grid link for Cyprus’ power security. Regional Industry/Defense: Israel and Greece signed the €3bn “Achilles Shield” air-defense deal, a major defense-industrial boost with potential knock-on interest for Cyprus’ Eastern Mediterranean partnerships.