Cyprus Business Now: weekly wrap-up

Here are the top business stories in Cyprus from the week starting July 27: Cyprus’ petroleum product sales fell sharply in June, according to figures by the state statistical service (Cystat), as the island’s fuel market continued to adjust to the lingering effects of higher prices and geopolitical uncertainty following the conflict in the Middle East. The statistical service reported that total petroleum product sales reached 129,479 tonnes in June 2026, representing an 8.0 per cent decline compared with the same month last year. The figures come as Cyprus continues to experience one of the highest annual increases in fuel prices in the European Union, despite retail prices easing in recent weeks from the peaks triggered by tensions between Israel and Iran. According to Eurostat, the price of fuels and lubricants for personal transport in Cyprus was 18.6 per cent higher in June 2026 than a year earlier, placing the island among the countries recording the steepest annual increases in the bloc. The Bank of Cyprus (BoC) on Monday announced that it was named Best Sub-Custodian Bank in Cyprus for 2026 by international financial publication Global Finance, recognising the bank’s performance in custody, depositary and post-trade services. The award acknowledges excellence across a range of asset servicing activities, including operational efficiency, technology, client service and regulatory expertise, while recognising institutions that consistently deliver high-quality custody solutions to institutional and private investors. According to the bank, the distinction reflects its continued commitment to safeguarding client assets while providing reliable custody and depositary services to Cyprus’ financial sector. It added that it also highlights the Bank of Cyprus’ continued investment in innovative post-trade services, supported by governance standards, regulatory compliance and expertise in local and international markets. CFA Society Cyprus announced on Monday the election of a new board of directors, marking a new phase for the organisation following its annual general meeting. The association said it is entering a new era of growth, strategic initiatives, and commitment to professional excellence and ethics after the leadership change. Andreas Spyrides has been elected president of the association, succeeding Constantinos Kourouyiannis, who during his tenure contributed to strengthening the organisation’s role and presence within Cyprus’ financial community. Jan-Hofmeyr Retief assumes the role of vice-president, while the seven-member board is completed by Kyriacos Inios as secretary and Evgeny Tarakanov as treasurer. The remaining members of the board are Stella Mourouzidou Damtsa, Byron Kaklopoulos, and Spyros Ierides. Bank deposits and lending in Cyprus both recorded stronger monthly increases in June, according to figures published by the Central Bank of Cyprus (CBC), reflecting continued growth in household and business banking activity. The CBC reported that total deposits increased by a net €601.2 million in June 2026, compared with a net increase of €343.8 million recorded in May. Despite the stronger monthly inflow, the annual growth rate of total deposits eased slightly to 5.0 per cent in June from 5.1 per cent in May. The outstanding balance of total deposits reached €58.7 billion at the end of June. At the same time, deposits held by Cyprus residents increased by €626.2 million during the month. The 50 highest-value property transactions completed in Cyprus during the first six months of 2026 were worth a combined €286.4 million, according to analysis released by real estate analytics firm Ask Wire. The analysis examined the country’s 50 largest property sales completed between January and June 2026, as well as how those transactions were distributed across Cyprus’ districts. The company, which uses technology to monitor property transactions, asking prices and construction activity, found that the 10 largest transactions alone accounted for €161.7 million of the total. The single largest transaction, valued at €55 million, involved a building and adjoining fields in Moni, Limassol district. Among the 10 most expensive property transactions nationwide, Limassol accounted for six sales with a combined value of €117.2 million. Investment app Wealthyhood x BoC on Tuesday launched trading in Cypriot and Greek stocks, allowing retail investors across Cyprus, Greece and Europe to invest in companies listed on the Cyprus Stock Exchange (CSE) and Euronext Athens through a single mobile application. The company said the expansion enables users to invest in Cypriot and Greek shares from as little as €1, while offering what it described as the lowest fees in the market. According to the announcement, the platform gives everyday investors direct access to leading Cypriot and Greek blue-chip companies, banking institutions and other domestic businesses from their mobile phones through fractional investing. The launch also represents an expansion of the strategic partnership between the Bank of Cyprus and Wealthyhood, with the local lender integrating access to the Cyprus Stock Exchange and the Athens market into the Wealthyhood x BoC investment platform. The Central Bank of Cyprus (CBC) on Tuesday published its 2025 Financial Stability Report, warning that although Cyprus’ financial system remains resilient, elevated geopolitical tensions, global uncertainty and emerging risks continue to pose significant challenges to financial stability. The annual report sets out the central bank’s assessment of the developments and risks affecting financial stability in Cyprus, focusing on the key medium-term risks facing the financial system, the resilience of the sector against adverse scenarios and the macroprudential measures adopted by the CBC to safeguard stability. In a message accompanying the report, Head of the CBC’s Financial Stability and Resolution Directorate Pany Karamanou said that “geopolitical and economic tensions, coupled with elevated global uncertainty, are shaping the outlook for financial stability“. “Against this backdrop, maintaining strong capital positions and adequate liquidity buffers remains essential to ensuring the resilience of the financial sector,” she added. The final investment decision to develop the Kronos natural gas field in block 6 of Cyprus’ exclusive economic zone offers an opportunity to exploit the area’s remaining gas reserves for the island’s domestic needs, according to energy expert Charles Ellinas. Speaking to the Cyprus News Agency (CNA), Ellinas described the final investment decision by the Eni and TotalEnergies consortium as an important milestone that could pave the way for wider development of Cyprus’ offshore gas resources. “This is certainly a historic development because, after 15 years, we are finally moving towards the process of exporting natural gas,” Ellinas said. He explained that annual production from the Kronos field is expected to reach around five billion cubic metres of natural gas, of which approximately four billion cubic metres will be destined primarily for European markets. “Europe imports around 300 billion cubic metres every year, while we will be sending four billion, so it is a small contribution rather than a solution for Europe,” he said. Aircraft maintenance firm Bird Aviation announced on Wednesday that it has signed a long-term agreement with low-cost airline easyJet to provide scheduled aircraft maintenance services at its facilities in Larnaca, strengthening Cyprus’ position as a regional aviation maintenance hub. The agreement has an initial duration of seven years, with an option to extend it by a further three years, the company stated. According to the announcement, the contract covers two maintenance lines dedicated to scheduled heavy maintenance checks for easyJet’s Airbus A320 family aircraft, with all work to be carried out at Bird Aviation’s facilities in Cyprus. The company said the agreement builds on the long-standing relationship between Bird Aviation and easyJet and establishes a stable framework for the continued provision of heavy maintenance services. It added that the deal will further reinforce the role of Bird Aviation’s Larnaca facilities in supporting easyJet’s fleet maintenance programme over the coming years. Cyprus’ economy is expected to slow down in 2026 as inflation accelerates, according to updated economic projections published on Wednesday by the Economics Research Centre of the University of Cyprus (CypERC), which cited the continuing conflict in the Middle East as a key source of uncertainty. The centre forecasts real gross domestic product (GDP) growth of 2.7 per cent in 2026, down from an estimated 3.8 per cent in 2025, before strengthening to 3.1 per cent in 2027. The latest projections also foresee inflation rising to 3 per cent in 2026, marking a sharp increase from the exceptionally low level recorded in 2025. Compared with the centre’s previous outlook published in April, the 2026 growth forecast has been revised down by 0.2 percentage points, while the projection for 2027 remains unchanged. According to CypERC, the downward revision reflects slower GDP growth during the first quarter of 2026 in both Cyprus and the euro area, together with developments captured by leading economic indicators between April and June. Cyprus’ average monthly earnings increased during the first quarter of 2026, according to provisional figures released by the Cyprus Statistical Service (Cystat) on Wednesday. However, it should be noted that the average salary remains a less representative measure of workers’ earnings than the median, with most employees earning considerably less than the overall average. Specifically, the average gross monthly earnings of employees in Cyprus reached €2,601 in the first quarter of 2026, up from €2,508 in the corresponding quarter of 2025, representing an annual increase of 3.7 per cent. However, while the average salary is influenced by relatively high earners at the top end of the income scale, the earnings distribution indicates that the salary received by the typical worker is lower, with the largest share of employees falling within the €1,500 to €2,999 monthly earnings bracket. After adjusting for seasonal factors, average gross monthly earnings stood at €2,652 during the first quarter of 2026, marking an increase of 0.8 per cent compared with the fourth quarter of 2025. Factorial has evolved into an AI-driven business management platform, recently securing a Series D funding round that values the firm at $2.5 billion. In an interview with the Cyprus Mail, Petros-Emmanouil Panagopoulos discussed the company’s expansion into South-Eastern Europe, including Cyprus. The platform connects human resources, finance, and IT, using an AI agent model that operates within strict user permission structures to ensure security and governance. By automating administrative workflows such as time tracking and expense management, Factorial helps small and medium-sized enterprises reduce operational overhead without replacing existing systems. Key benchmarks for regional success include high customer retention, robust local partnerships, and strong AI adoption rates over the coming months. The Cyta board of directors on Thursday presented its report covering its February 2024 to July 2026 term, describing the period as one marked by major transformation, strategic reforms and significant investments aimed at strengthening the organisation’s role in Cyprus’ digital future. The board reported that its work focused on reinforcing Cyta’s position as a reliable connectivity provider while preparing the organisation to play a broader role in the country’s digital development. It said that investments in digital transformation, telecommunications infrastructure and technology services laid stronger foundations for improved customer services, created additional opportunities for the economy and supported Cyprus’ wider digital progress. One of the most significant developments during the board’s tenure was the expansion of the institutional and legislative framework governing Cyta’s operations. Cyprus’ tourism revenue fell by 4.8 per cent in May 2026 as the war in Iran depressed visitor arrivals, particularly from the island’s primary tourist market, despite average spending per visitor remaining broadly unchanged. Specifically, revenue from tourism reached €355.2 million in May 2026, compared with €373.3 million in the same month of 2025, according to figures released on Thursday by the Cyprus Statistical Service (Cystat). The figures come after tourist arrivals in May also declined, largely due to the continuing impact of regional instability, particularly the conflict in the Middle East, which has affected the sector during 2026. For the January to May 2026 period, tourism revenue is estimated at €798.2 million, compared with €955.8 million during the corresponding period of 2025, representing a 16.5 per cent decrease. Cyprus recorded one of the lowest unemployment rates in the European Union in June 2026, with joblessness on the island falling to 3 per cent, according to figures published by Eurostat on Thursday. Data released by the EU statistical office revealed that the seasonally adjusted jobless rate in Cyprus edged down from 3.1 per cent in May 2026 and 3.2 per cent in April 2026. The 3 per cent rate placed Cyprus joint lowest among all EU member states alongside Bulgaria, contrasting sharply with the broader EU average. The total number of unemployed persons in Cyprus stood at approximately 16,000 in June 2026, holding firm at the same level recorded in May 2026 and down from 17,000 in April 2026. For young workers under the age of 25, the youth unemployment rate in Cyprus remained stable at 7.8 per cent in June 2026, unchanged from the previous month. The Bank of Cyprus (BoC) has been named Cyprus’ Best Digital Bank at the Euromoney Awards for Excellence 2026, recognising the lender’s digital achievements during the evaluation period from January 1, 2025 to December 31, 2025. The bank said the award reflects a series of major digital innovations introduced during 2025, including the integration of Fleksy, Cyprus’ first buy now, pay later service, into its digital banking platform. It also highlighted significant upgrades to its Joey youth banking ecosystem, including savings and goals features and the ability for users to transfer money between Joey accounts. Other developments included the expansion of QuickAccount to support sterling and US dollar accounts, as well as the launch of what the bank described as the market’s first digital housing loan. The Bank of Cyprus added that its digital strategy has been reflected in strong customer adoption, with active digital users exceeding 500,000. Tourism revenue figures for May and the first five months of 2026 confirmed that Cyprus tourism has returned to a stable recovery path, Deputy Minister of Tourism Kostas Koumis said on Thursday, following the release of data by the Statistical Service. In a written statement sent to the Cyprus News Agency (CNA), Koumis said the 4.8 per cent decline in tourism revenue in May compared with 2025 was not excessive, while compared with 2024 the sector recorded growth of 14.4 per cent. “The statistical measurement confirms that the tourism sector is without doubt now on a stable path, and proves that the coordinated and targeted actions of the government, always in cooperation with our country’s tourism industry, had a positive impact on the sector,” Koumis said. Regarding the first five months of the year, the deputy minister said the overall revenue picture had improved by 7.4 percentage points compared with the first four months, which he said reflected the gradual and now established recovery of the sector. The Central Bank of Cyprus (CBC) on Friday published a new Economic Brief examining how the European Central Bank’s (ECB) recent monetary policy cycle reshaped the composition of bank lending in Cyprus, concluding that a marked shift towards longer-term fixed-rate loans has brought domestic financing conditions closer to those prevailing across the eurozone. The report, prepared by the CBC’s Economic Analysis and Monetary Policy Division, said the move towards longer-term fixed-rate lending, particularly in the mortgage market, reduced the exposure of new borrowers to interest rate fluctuations, narrowed the gap between lending and deposit rates, and altered how monetary policy is transmitted through the Cypriot economy. According to the central bank, the ECB’s monetary tightening cycle, which ran from July 2022 until September 2023, followed by the subsequent easing phase between June 2024 and June 2025, was accompanied by significant changes in the composition of new lending in Cyprus. Eurobank on Friday reported €738 million in net profit for the first half of 2026, with its Cyprus operations contributing €231 million as the group raised its full-year outlook following stronger-than-expected performance. Adjusted net profit reached €776m, up 9.2 per cent year on year, while earnings per share stood at €0.20 and return on tangible book value reached 16.6 per cent. Eurobank CEO Fokion Karavias said the group continued to deliver strong results despite ongoing geopolitical uncertainty and renewed tensions in the Middle East. “Despite persistent geopolitical uncertainty and renewed tensions in the Middle East, the economies of our core markets have remained on a solid growth trajectory,” Karavias said. He added that the Greek economy had remained resilient, supported by investment activity, tourism and continued expansion in business lending. “In Cyprus and Bulgaria, economic sentiment and growth remain also robust,” Karavias said. The bank’s non-Greek operations, which include Cyprus and Bulgaria, generated €361m in adjusted net profit, accounting for 46.5 per cent of group profitability. Cyprus recorded a general government fiscal surplus of €420.30 million in the first six months of 2026, equivalent to 1.1 per cent of GDP, according to preliminary figures released on Friday by the Cyprus Statistical Service (Cystat). The surplus was slightly higher than the €416.80m, or 1.1 per cent of GDP, recorded during the corresponding period of 2025. Total government revenue rose by 4.1 per cent to €7.40 billion between January and June 2026, compared with €7.11 billion in the same period a year earlier. The statistical service said the increase reflected an additional €290.30m in revenue over the first half of 2025. Revenue from taxes on income and wealth increased by €101.00m, or 6.3 per cent, reaching €1.69bn compared with €1.59bn a year earlier. Energy company Shell said on Friday it had ‌agreed to sell its BG Cyprus unit to Hungarian oil and gas firm MOL Group for up to $720 million, as the British oil major sharpens its focus on LNG ​operations. BG Cyprus’ 35 per cent non-operated interest in a Cyprus Offshore block, home ​to the Aphrodite gas field in the eastern Mediterranean, will ⁠be controlled by MOL upon the expected 2027 completion of the deal. “Our ​decision to exit is driven by disciplined capital allocation and portfolio choices, as ​we focus on opportunities that strengthen our integrated LNG value chain,” Shell’s Integrated Gas President Cederic Cremers said in a statement. Shell has been seeking to expand its LNG portfolio to capitalise ​on rising global demand for the fuel and on Thursday said it ​will take a final investment decision on its Canada LNG project phase 2 by the ‌end ⁠of 2026. Cyprus’ new-build residential property market recorded 3,594 sales worth €1.149 billion during the first half of 2026, according to an analysis by Landbank Analytics, with Limassol leading in total value, Nicosia recording the highest transaction volume and Paphos maintaining the most expensive house market. The January 1 to June 30, 2026 period saw sales of apartments and houses either under construction or at the planning stage reach a combined value of €1.15 billion, reflecting continued activity across the island’s residential property sector. The average value per transaction stood at €319,618, while the median price was €232,500, with the wide gap between the two figures attributed to a number of particularly high-value property sales. The analysis highlighted significant differences between Cyprus’ five districts, with each market displaying distinct characteristics depending on buyer demand, property type and price levels.