AGP Executive Report

Craft & Creative Economy: Cyprus joined the inaugural Homo Faber Summit in Venice, with the Deputy Ministry of Culture and Cyprus Handicraft Service pushing international ties for local makers and new production and collaboration models. Critical Minerals & AI: US miner KoBold Metals is using AI-directed exploration in DR Congo to secure copper and cobalt supplies and gain an edge in the lithium race. Energy Infrastructure: Turkey warned the Greece–Cyprus–Israel undersea power cable must be coordinated with Ankara, reviving seabed dispute risks for the Great Sea Interconnector. Electricity Interconnection (Egypt–Cyprus): Egypt and Cyprus reviewed progress on linking power grids and boosting renewable energy cooperation. Housing & Construction: Cyprus launched a scheme letting homeowners add a storey or extension (up to 150 sq m, 180 on larger plots) to create family housing even when density limits are reached. Transport Costs & Freight: Cyprus airfares rose ~5% in August while EU trends fell; Eurostat also shows Cyprus has the EU’s third-highest share of dangerous goods in road freight. Safety & Property: Limassol balcony collapse investigations continue after 56 apartments were evacuated; owners must appoint a civil engineer to make the building safe again. Maritime Security: Strait of Hormuz traffic dropped sharply to nine vessels as Cyprus joined calls for free navigation. Banking: Alpha Finance-AXIA lifted its Bank of Cyprus target to €12.30 on strong profitability and shareholder returns. Tourism & Rural Development: Troodos Mountain Games 2026 highlights government push for year-round, nature-based tourism in mountain communities.

Eastern Mediterranean Security: Greece’s PM Mitsotakis used the UNGA to press for dialogue with Turkey grounded in international law, while also flagging the Cyprus issue and Eastern Med security. Trilateral Defence Push: In Cairo, Egypt, Greece and Cyprus defence ministers agreed on stronger cooperation, including protection for gas fields, offshore energy and supply lines, plus coordination on navigation and irregular migration. Cyprus–Turkey Response: Cyprus’ defence ministry hit back at Turkish criticism, saying partnerships are between sovereign states and fully aligned with international law. Golden Visa Overhaul: Cyprus plans to tighten its “golden visa” scheme ahead of Schengen, reviewing about 12,000 permits since 2013 and considering where investment should go (education, defence, innovation) while building a new tracking system. Energy Costs & Trade: A reported US diesel export halt could lift fuel prices across Europe, with knock-on effects for Cyprus. Housing & Construction Pressure: Cyprus home prices rose 8.5% in Q2 2026 on foreign demand and higher construction costs, while a Limassol balcony collapse evacuated residents and renewed calls for repairs by licensed engineers. Agriculture Risk Management: Bulgaria published a sheep and goat pox vaccination plan for public consultation, with thresholds and coordination steps. Local Infrastructure: Nicosia’s Makarios Avenue redevelopment is under scrutiny over EU funding conditions, with the transport ministry opposing changes that could trigger repayments.

Household Pressure: Syprodat warns rising electricity and fuel costs are squeezing disposable income and could push previously reliable borrowers toward missed loan repayments, calling for urgent, targeted relief. CAP Payments: Cyprus signals a potential reprieve for pensioner farmers as EU plans shift toward an optional approach to direct payments under post-2027 CAP. Property & Construction: The Central Bank reports Cyprus house prices up 8.5% year-on-year in Q2 2026, with foreign demand and higher construction costs driving growth; meanwhile, a housing-supply gap of ~39,000 units highlights labour and productivity constraints in construction. Food & Pharma Manufacturing: Cystat says sales of locally produced industrial goods rose 3.7% to €4.77bn, led by halloumi (€364.1m) and strong bakery and pharmaceutical categories. Maritime & Trade: Cyprus staged its first national pavilion at SMM Hamburg, showcasing shipping tech and services, while Eurostat data shows EU freight still relies mainly on road, with food and mining among key volume drivers. Energy & Gas: President Christodoulides urges ExxonMobil to accelerate development of the Pegasus/Glaucus gas fields, pushing toward a faster development and production plan. Local Industry Conflict: Residents in Mitsero and nearby communities protest a planned asphalt plant relocation, seeking a court freeze as work reportedly begins. Water Infrastructure: Limassol Water Board signs a €1.64m contract for new reservoirs and pumping stations for Fasoula and Mesa Geitonia, starting October 2026. Digital Learning: UNIC launches its Fall 2026 blockchain MOOC, adding hardware wallet rewards and scholarships.

Maritime Salvage: A salvage operation is underway off Oman to recover crude cargo from the Caroline Bezengi wreck, with Cyprus-linked EDT Kennedy (Limassol-based) among the vessels on scene. Retail & Campus Economy: Near Cypress College, new dining momentum is building as LJ’s Lil Cafe prepares to open this fall and a second McDonald’s has opened nearby. Defense & Energy Security: Egypt, Greece and Cyprus met in Cairo to deepen trilateral military cooperation, while a separate Cyprus-Greece-Egypt deal targets protection of East Med gas fields and offshore infrastructure. Oil-Route Tensions: Britain plans “defensive” RAF Voyager refuelling support for Saudi Arabia amid Houthi attacks, as shipping and fuel-price risks remain in focus. Cyprus Finance: Cyprus has regained an S&P A rating, a milestone that reopens debate on what comes next for the economy. Property & Governance: In Nicosia, a shopkeepers’ committee is calling for the mayor’s resignation over Makarios Avenue consultation and related contracts. Environment & Community: Let’s Do It! Cyprus clean-up week is set for Oct 26–Nov 1, with volunteer registration now open.

Eastern Med Energy Security: Cyprus, Greece and Egypt agreed in Cairo to strengthen joint protection of gas fields, supply lines and offshore infrastructure, boosting defence coordination for a “rapid and unified response” to threats. Aphrodite Gas Push: President Christodoulides met Chevron’s Javier La Rosa in New York, urging faster steps toward a Final Investment Decision so Aphrodite can move from planning to production. Maritime Cooperation: Cyprus and China renewed focus on maritime ties, including seafarers’ wellbeing, maritime education and IMO coordination. Organic Farming Growth: Organic farming reached 8.6% of cultivated land, supported by €22m in CAP funding and aimed at building consumer trust. EU Finance Access: Cyprus Chamber chief Stavros Stavrou called for simpler routes for businesses to access EU funding for innovation and scaling. Retail & Logistics: COMFY launched a nationwide marketplace with partner sellers, targeting 500,000 products by end-2027. Property Market Snapshot: Landbank Analytics put H1 2026 resale activity at €727.2m across 3,202 transactions, with Limassol leading in value. Fuel Prices Pressure: Consumer protection head warned pump prices may keep rising despite government monitoring and possible cabinet measures. Labour Rights: MPs said complaints about hiring via temporary agencies are linked to human trafficking and urged action on contractor liability.

Israeli “Plan B” Push: Deutsche Welle reports more Israelis are moving to Cyprus for property and investment, raising local debate over housing pressure and land prices. EU Budget Talks: EU ministers discussed the 2028–2034 Multiannual Financial Framework and rule-of-law priorities ahead of the October European Council. Defence Cooperation: Greece, Egypt and Cyprus agreed a joint declaration to deepen trilateral defence ties, exercises and tech cooperation in the Eastern Mediterranean. Cyprus Water Governance: EOA chief Constantinos Yiorkadjis told MPs water responsibilities are “scattered” across ministries and urged a single independent authority plus direct delivery to district tanks. Limassol Infrastructure: The €120m Kouris sewerage expansion is underway, targeting 42,000 households with 220km of pipelines and new treatment capacity. Labour Rights Alarm: Trade unions warned Parliament that worker leasing may be linked to human trafficking, pushing for clearer construction-sector legislation. Energy Costs Watch: Finance Minister Makis Keravnos said fuel-price relief is being prepared, with high pump prices expected to last into mid-2027. Maritime/Industry Angle: MPs examined Cyprus’s defence and energy alliances, including the Great Sea Interconnector dispute.

Cyprus as defence hub: The UK says it will provide “defensive air-to-air refuelling” to Saudi Arabia using an RAF Voyager based at RAF Akrotiri, with the mission expected to run for weeks as Houthi drone and missile attacks intensify. Energy & prices: EU fuel and lubricant prices jumped 23.8% year-on-year in August, while Cyprus inflation accelerated to 5.2% as energy and transport costs spiked; governments elsewhere are also tightening fuel-price controls. Cyber & compliance: Cyprus SMEs are starting to feel the practical impact of the EU Cyber Resilience Act, while Visa expands cybersecurity advisory tools in Cyprus to speed vulnerability fixes. Tech & investment: Morphotonics raised over €40m to scale waveguide manufacturing for AI glasses, and Zenith Energy acquired a 9MW solar project in Italy, adding to its solar pipeline. Shipping & labour: Cyprus is pushing debate on seafarer fatigue and working hours as it joins renewed scrutiny of maritime labour rules. Local business & economy: Cyprus tourism decline is limited to 8% through July, and the Central Bank says the island’s foreclosure framework is supporting financial stability through consensual settlements.

Cyprus Inflation Watch: Cyprus’ consumer prices rose for a fifth straight month in August, with annual inflation jumping to 3.5% as fuel and utility costs drove the increase. Credit Crunch Signals: The Central Bank of Cyprus reports credit servicers and credit acquiring companies held a €19.28bn loan portfolio at end-June 2026, with a non-performing loan ratio still near 95% and 62,000+ borrowers affected. Shipping & Energy Focus: Cyprus’ shipping sector and energy agenda stayed in the spotlight, including moves around hydrogen planning in Ayia Napa and renewed attention on renewables and energy independence. EU Policy Pressure: Cyprus remains among EU states yet to ratify CETA, keeping the EU-Canada trade deal in limbo while EU leaders push a broader “future” partnership. Aviation & Tourism: Eurostat data shows Cyprus commercial flight activity fell 3% in August even as much of Europe saw growth—an early signal for the peak season. Property & Investment: Israeli investment and migration continue reshaping Cyprus’ property market, with Israeli buyers active across coastal districts. Wine Sector Support: The agriculture ministry says EU-backed funding and state aid will help winegrowers tackle drought, climate change and rising costs. Space Ambitions: Cyprus and France signed a declaration to cooperate on space science, including Earth observation and satellite communications.

Inflation & Cost of Living: Cyprus inflation accelerated again, with harmonised prices jumping to 5.2% in August as fuel and utility costs surged, adding pressure on households and small businesses. Energy Transition & Industry: Oev will host a European hydrogen project meeting in Ayia Napa on Sept 22, bringing together 25 partners to push the hydrogen value chain. Shipping & Maritime Jobs: Cyprus and Greece reaffirmed shared maritime priorities at a shipowners’ dinner in Athens, while Cyprus also put seafarers’ rights and the competitiveness of the European fleet under the spotlight. Tech & Innovation Ecosystem: Deloitte’s “Cultivating Success Stories of Innovation” in Limassol highlighted Cyprus’ growing start-up and scale-up scene, and Reflect Festival teamed up with Plug and Play to connect local founders to global investors. Construction & Real Assets: Skek warned at the Cyprus Property Show 2026 that geopolitics and rising construction costs are weighing on the market, as a Nicosia apartment renovation shows how design is reshaping space use. Transport & Logistics: Public Works Department announced motorway and city road closures for resurfacing and installations. Manufacturing & Clean Power Supply Chains: LG Energy Solution says it has completed five ESS production sites in North America, with a new Lansing plant ramping up. Agriculture & Food Safety: Cyprus food safety is under strain as drought, FMD and imports raise concerns about resilience. Defence & Crisis Planning: Keve and the defence ministry signed a cooperation deal to strengthen crisis management and business resilience.

Energy & Industry Contracts: Halliburton won a multi-year integrated contract from Eni for Cronos ultra-deepwater work offshore Cyprus, covering drilling, well construction, automation and completions in Block 6—another sign of how Cyprus-linked offshore spend is being bundled for efficiency. Inflation & Cost Pressures: Cyprus posted the EU’s third-highest inflation rate, with harmonised inflation jumping from 4.4% to 5.2% in a month, spreading across sectors and squeezing households and small firms. Fuel & Agriculture Support: Gas station owners warn pump prices may rise again, while the government approved €1.5m in EU-funded emergency schemes to help farmers with marked diesel and fertiliser costs tied to the Middle East crisis. Construction & Property Markets: Eurostat data show EU construction output slipping, but Cyprus building activity stays strong; meanwhile, Landbank reports resale markets vary sharply by district, with Nicosia leading transactions and Limassol driving value. Digital & Public Services: Cyprus is moving toward EU Digital Identity Wallet integration, with a €9.8m contract to upgrade its public service app. Space & Innovation: Research Deputy Minister Damianou says Cyprus is emerging in the European space ecosystem, citing ESA associate membership and a Limassol space incubation centre. Bicommunal Action: Volunteers joined a World Cleanup Day effort across Nicosia’s divide, backed by local authorities and NGOs. Defense Industry Links: Israel’s embassy says Cyprus is an increasingly important defence partner, encouraging joint projects and technology cooperation.

Space & Innovation: Cyprus is positioning itself as an “emerging player” in the European space ecosystem, with associate ESA membership, satellite ground infrastructure investment, and a Limassol space business incubation centre aimed at boosting Earth observation and innovation. Energy & Industry Costs: EU-backed schemes worth €1.5m will support farmers hit by higher diesel and fertiliser costs, while industry groups warn fuel prices in Cyprus could rise again, pushing calls for targeted help that reaches consumers. Construction & Real Estate: Eurostat data shows EU construction output slipping in July, even as Cyprus keeps strong building activity; meanwhile, resale property remains highly district-dependent, with Nicosia leading transaction volume but Limassol driving value. Finance & Credit: S&P upgrades Cyprus back to an A rating (positive outlook), citing stronger services exports, FDI inflows, and continued debt reduction. EU Policy Pressure: Cyprus rejects parts of the EU’s “new own resources” proposals, warning they would strain public finances, especially around ETS-linked funding. Agriculture & EU Fisheries: The EU proposes doubling minimum fisheries funding to €4bn, now awaiting Council and Parliament talks. Security & Defence Industry: Israel signals interest in deepening Cyprus defence-industry cooperation, pointing to joint projects and technology partnerships.

EU Agriculture Support: Cyprus approved a €1.5m EU-funded emergency aid package for farmers hit by higher diesel and fertiliser costs, with applications opening in November and payments capped per beneficiary. Energy Storage Push: Cyprus Institute president Stavros Malas says diesel and natural gas can’t be the long-term answer, urging sustainable energy storage alongside renewables as Deputy Minister Nikodemos Damianou visits the PROTEAS research facility. Sovereign Credit Boost: S&P upgraded Cyprus’ long-term credit rating to A for the first time since the 2011 crisis, citing stronger fiscal revenues, services exports and foreign direct investment. Digital ID Deadlines: EU Digital Identity Wallet deadlines are colliding with uneven readiness; Cyprus is bidding on a €9.8m upgrade to its public service app to prepare for EUDI Wallet integration. Maritime & Fisheries Policy: The EU proposes doubling minimum fisheries funding to €4bn, while Cyprus’ shipping sector continues to be shaped by broader EU rules and cooperation moves. Public Order in the Buffer Zone: The UN warned hunters that hunting in Cyprus’ buffer zone is strictly prohibited and will be reported for prosecution. Infrastructure & Planning: The new Central Prison will be built in Agios Sozomenos instead of Mathiatis, after cost and timeline assessments. Local Economy Signals: Cyprus’ short-term outlook returned to marginal growth in August, with domestic indicators offsetting weaker external conditions.

Sovereign Credit Boost: S&P Global upgraded Cyprus’ long-term credit rating to A for the first time since the 2011 crisis, citing resilient growth, stronger services exports (including IT and IP), foreign investment inflows and continued debt reduction. EU Budget Fight: Nicosia rejected three EU “New Own Resources” proposals, drawing red lines over ETS-linked funding and a flat-rate contribution for large EU firms, warning of pressure on public finances. Energy Transition Push: Cyprus Institute president Stavros Malas said diesel and natural gas can’t be the long-term answer, stressing sustainable energy storage alongside renewables after a visit to the PROTEAS research facility. Renewables Snapshot: Eurostat data showed renewables supplied 36.8% of Cyprus net electricity generation in June (down to 29.98% in July), highlighting volatility in the clean-energy ramp. Fisheries Funding: EU plans to double minimum fisheries funding to €4bn are now before EU institutions, with Cyprus urging stronger, targeted support for fishermen. Infrastructure & Industry: The new Central Prison will be built in Agios Sozomenos (not Mathiatis) after cost and timeline assessments; Akel criticised the lack of consultation with local authorities. Maritime & Tech: Cyprus opened ship registry wider in a legal shake-up, while local shipping and tech initiatives kept focus on competitiveness and skills.

Maritime & Ports: Transport Minister Evanthia Tsolaki visited DP World Limassol and Eurogate Container Terminal Limassol, focusing on terminal upgrades, daily operations and Limassol’s cruise gateway role. Energy: Eurostat data show renewables delivered 36.8% of Cyprus net electricity generation in June (down to 29.98% in July). EU Fisheries: House Speaker Annita Demetriou urged stronger EU support for Cypriot fishermen after the Commission’s common fisheries policy evaluation, warning stocks are under pressure. Tech & Skills: Paphos Chamber of Commerce leads an Erasmus+ push on youth education for blockchain, AI and Web3, with conferences planned across Cyprus and partners’ countries. Construction & Industry Costs: Cyprus construction material prices rose again for another month, while fuel-price pressure is prompting finance ministry “monitoring” and debate over possible VAT relief. Security & Trade Risks: Authorities are investigating whether a large ketamine shipment seized in Limassol was a transit route toward Israel, potentially involving luxury yachts. Governance & Local Impact: Akel says the government is bypassing local authorities over the Ayios Sozomenos prison site decision. Regional Energy Politics: TRNC/Turkey gas pipeline plans drew fresh pushback after UN protest letters, with Turkey saying the project is humanitarian and legal.

Port & Logistics: Transport Minister Evanthia Tsolaki toured Eurogate’s Limassol container terminal, discussing upgrades and yard expansion as cooperation with the port concession continues. Maritime Policy: Cyprus joins Greece, Italy and Malta in pushing back on EU shipping decarbonisation rules ahead of IMO talks, warning about fuel costs and competitiveness. Energy Watch: Europe’s LNG scramble is intensifying as global prices jump and Cyprus still lacks an operating LNG import terminal. Security & Trade: Authorities are probing whether a record ketamine shipment found in Limassol was a transit stop en route to Israel, potentially via luxury yachts. Business & Jobs: Oev promoted Lena Panayiotou to deputy director-general and signed an MoU with TechIsland to boost Cyprus’ tech and innovation ecosystem. Construction Costs: Cystat reports construction material prices rose again in August, with sharp annual jumps in electrical fixtures, plastics and aluminium products. Tourism: Cyprus expects a French rebound in 2027 as airlines add seats, after arrivals from France nearly halved in August. Hospitality Pressure: Pasika says eating out in Cyprus is up 26% since 2023, driven by energy and alcohol costs. Maritime Community: CYMEPA plans a Malindi Beach clean-up in Limassol for World Maritime Day, supported by major shipping and port players.

Shipping & Trade: Cyprus Deputy Minister to the President for Shipping Marina Chatzimanolis is in Athens for a three-day push to strengthen the Cyprus Ship Registry and boost the sector’s competitiveness, with meetings across the shipping industry and events tied to World Maritime Day and the Maritime Labour Convention. EU Politics & Security: Six Cypriot MEPs criticised European Commission President Ursula von der Leyen’s State of the Union for not mentioning Cyprus, while also weighing broader EU priorities on defence, energy and migration. Tax Enforcement: Cyprus authorities took part in an EU-wide VAT fraud probe by the European Public Prosecutor’s Office targeting an alleged €15.7m scheme involving online mobile phone sales; searches, arrests and asset freezes were carried out in Cyprus, with court orders freezing about €20.5m. Public Health: Nicosia stepped up mosquito-control after rainfall, running daily inspections and treatments across river channels and drainage points as West Nile cases rise. Cybersecurity: A new ThreatsDay bulletin highlights how attackers keep reusing exposed keys across AI tools, old bugs and weak logins, with defenders struggling to keep up. Digital Connectivity: Primetel and Bitdefender teamed up to include mobile security with Primetel’s GIGA Unlimited 5G plans across Cyprus.