Cyprus Business Now: Wizz Air, inflation, tourism, Limassol startup, real estate

Low-cost airline Wizz Air launched its new Larnaca-Madrid route in September as part of its wider effort to expand its Cyprus network, with network director Andras Szabo saying the airline sees considerable potential for year-round travel between Cyprus and Spain. In an exclusive interview with the Cyprus Mail, Szabo said the new connection was an important addition to Wizz Air’s Larnaca network and reflected the airline’s broader strategy of strengthening Cyprus’ links with European destinations. “We are very excited about the launch of Madrid,” Szabo said. “It is an important addition to our network from Larnaca and another step in strengthening the connectivity between Cyprus and Spain,” he added. Szabo said the route would give passengers in Cyprus direct access to Madrid while also making Cyprus more accessible to Spanish travellers throughout the year. Superpositions Studio is building a quantum computing software platform from Limassol, aiming to help businesses determine whether the rapidly developing technology can deliver practical value without requiring them to employ specialist quantum scientists. The company spoke exclusively to the Cyprus Mail about its origins in Cyprus, its work across finance and energy, and its ambition to develop Limassol into a centre for quantum software research. Superpositions Studio was created to address what it described as a fundamental problem in the quantum computing industry, namely that companies are increasingly interested in the technology but often struggle to determine whether it can solve a particular business problem. “Exactly that ‘do not yet know’ is the problem,” the company said. More than $40 billion has been invested in quantum computers worldwide and more than €11 billion in Europe, according to the company, while the machines themselves are already operating. Yet businesses considering quantum computing have traditionally faced a choice between hiring specialist staff, who are scarce and can cost more than $150,000 a year, or commissioning consultancy work costing around $50,000 and taking months to produce a report. Superpositions Studio aims to turn that expert process into software. Cyprus tourism revenue rose by 4.6 per cent year-on-year in July to €536.5 million, according to the Cyprus Statistical Service (Cystat), as the sector recorded higher visitor spending during a summer season disrupted by the Iran war. Revenue reached €513m in July 2025, while for the first seven months of 2026 it stood at €1.76 billion, down 7.0 per cent from €1.89 billion during the same period last year. The July increase came as tourists spent considerably more during their visits, with average expenditure per person rising 5.7 per cent to €920.66, from €870.78 a year earlier. Total tourist arrivals fell slightly from 589,116 to 582,754, while the average length of stay declined from nine days to 8.6 days. Despite the shorter stays, average expenditure per day increased from €96.75 to €107.05. Cyprus house prices rose 7.9 per cent year-on-year in the second quarter of 2026, significantly faster than the EU average, according to both Eurostat and Cyprus Statistical Service (Cystat) data, reflecting renewed momentum in the island’s housing market. The increase in Cyprus compared with the second quarter of 2025 was above the 4.7 per cent rise recorded across the EU and the 4.0 per cent increase in the euro area. Cyprus also recorded stronger quarterly growth, with house prices rising 2.4 per cent between the first and second quarters of 2026, compared with increases of 1.2 per cent in the EU and 1.1 per cent in the euro area. The latest Cystat figures showed that Cyprus’ House Price Index reached 105.46 points in the second quarter, up from 102.95 in the first quarter and 97.74 a year earlier. The annual increase represented a sharp acceleration from the 3.4 per cent recorded in Cyprus in the first quarter of 2026. Cyprus recorded 9,152 new enterprises in 2024, while 5,566 businesses closed, according to Eurostat data showing that new business creation outpaced enterprise deaths on the island during the year. The figures gave Cyprus an enterprise birth rate of 9.70 per cent, compared with a provisional enterprise death rate of 5.90 per cent. The data put Cyprus below the EU average for business creation but also showed a considerably lower rate of enterprise deaths than the bloc as a whole. Across the EU, 3,541,482 enterprises were created in 2024, giving the bloc an enterprise birth rate of 10.36 per cent. A provisional 3,143,782 enterprises ceased trading during the year, corresponding to a provisional death rate of 9.20 per cent. The Cyprus Securities and Exchange Commission (CySEC) announced on Friday that it will launch a nationwide financial awareness campaign next week as part of World Investor Week 2026, focusing on investor resilience and protection against digital deception. The campaign will run from October 5 to 11 and will see CySEC join regulatory authorities from more than 100 countries in the initiative led by the International Organisation of Securities Commissions (IOSCO). CySEC has participated in World Investor Week for the eighth consecutive year, combining educational activities, public awareness initiatives and guidance for investors. The regulator will deliver educational presentations at primary, secondary, and technical schools across Cyprus, alongside university lectures. The school presentations will form part of the sixth cycle of CySEC’s school lecture programme, running from October through December. The Cyprus Fiscal Council on Friday called for a shift away from broad tax cuts as a response to inflation, arguing in a presentation covering developments through August 2026 that support should instead be temporary and targeted at vulnerable households. The presentation, titled “Inflation in Cyprus 2025-2026: From the energy shock to a fiscally prudent response”, examines the evolution of inflation, the contribution of energy, food and services, and the fiscal options available for supporting vulnerable groups. The council described a sharp reversal in Cyprus’ inflation position, with the country moving from the lowest inflation rate in the European Union in 2025 to the third-highest in August 2026. Cyprus recorded average inflation of 0.8 per cent in 2025, the lowest rate in the EU, with inflation close to zero between July and December. The increase began in March 2026, when inflation reached 1.5 per cent, amid the crisis in Iran and disruption around the Strait of Hormuz. By August, inflation had reached 5.2 per cent, according to the council. The council said the speed of the increase demonstrated “the unusually high sensitivity of Cyprus to an external energy shock”. Cyprus recorded 1,013,843 guest nights in short-term rental accommodation booked through online platforms in the first quarter of 2026, according to Eurostat data covering stays arranged through platforms including Airbnb, Booking and Expedia. The figure covers January to March and reflects Cyprus’ status as a single statistical region because of the country’s small size compared to most other EU member states. Eurostat published the figures on Friday as part of its latest data on short-stay accommodation offered through online platforms, with national data available for the second quarter of 2026 and regional data for the first quarter. The data showed that 258.8 million nights were spent across the European Union between April and June 2026, representing an increase of 5.3 per cent, or 13.1 million nights, compared with the second quarter of 2025. Compared with the second quarter of 2024, the number of nights spent in EU short-term rental accommodation was 23.9 per cent higher, equivalent to an increase of 50.0 million nights. At regional level, Cyprus was counted as a single region, meaning its 1,013,843 guest nights for the first quarter represent the total for the country. Cyprus’ unemployment rate rose to 4.1 per cent in August 2026, according to Eurostat data, as the jobless rate across both the European Union and euro area remained broadly stable. The Cyprus rate increased from 4.0 per cent in July and 3.9 per cent in June, after standing at 3.8 per cent in May. It remained below the EU unemployment rate of 6.1 per cent and the euro area rate of 6.4 per cent in August. Eurostat estimated that around 22,000 people were unemployed in Cyprus in August, unchanged from August 2025 and up from around 20,000 in May. The number had stood at around 21,000 in both June and July. Cyprus’ unemployment rate was 4.2 per cent in August 2025 before falling to 3.8 per cent in May 2026 and subsequently rising over the following three months. Eurobank has unveiled the winning architectural proposal for a €2 million day centre for people at the most severe end of the autism spectrum, with the project set to move into its next stage in Strovolos. The proposal was presented at a special event attended by President Nikos Christodoulides, Deputy Minister of Social Welfare Tina Pavlou and Eurobank Group chief executive officer Michalis Louis. The centre, which will be built in the Ayios Dimitrios parish of Strovolos, will provide a modern care and support facility for people at the most severe end of the autism spectrum. Eurobank will cover the full €2 million cost of the project, while the Deputy Ministry of Social Welfare will be responsible for operating the centre once it is completed. The architectural competition attracted significant interest, with 37 architectural practices and study teams submitting proposals for a project with particular technical requirements and a strong social focus. The National Bank of Greece purchased 1,218,453 of its own common shares between September 22, 2026, and September 29, 2026, as part of the initial tranche of its ongoing share buyback programme, the lender announced in an official release. The transactions carried out on Euronext Athens required a total outlay of €20,822,480.29 at a weighted average price of €17.0893 per share. The share purchases follow resolutions approved at the annual general meeting of shareholders on April 30, 2026, alongside regulatory approval granted by the European Central Bank’s (ECB) Single Supervisory Mechanism on June 8, 2026. The European Commission on Thursday disbursed nearly €120 million to Cyprus under the Recovery and Resilience Facility after the country satisfactorily completed a series of agreed reforms and investment targets. The payment formed part of a wider disbursement of more than €9.8 billion to Poland, Sweden, Belgium, Estonia and Cyprus under the facility, which is at the heart of the European Union’s NextGenerationEU recovery programme. For Cyprus, the latest payment follows its sixth request for funding, submitted on December 17, 2025, and approved by the Commission on July 13, 2026. With the latest disbursement, Cyprus has now received 67 per cent of the total funding allocated to its national recovery and resilience plan. The plan provides for a total of €1.02 billion in grants for Cyprus. Cyprus’ annual inflation rate remained at 5.2 per cent in September, according to a flash estimate by Eurostat, leaving the country among the member states with the highest inflation rates as euro area inflation accelerated to 3.8 per cent. The September estimate for Cyprus was unchanged from August, when inflation had already reached 5.2 per cent, while prices were estimated to have fallen by 0.4 per cent month-on-month. The figures marked a sharp increase from the 0.0 per cent annual inflation recorded in Cyprus in September 2025, with inflation subsequently rising to 3.0 per cent in April 2026, 3.5 per cent in May, 4.1 per cent in June, 4.4 per cent in July and 5.2 per cent in August. Cyprus’ September rate was well above the 3.8 per cent euro area average, although it was below the highest estimated rates recorded among member states. PwC Cyprus has strengthened its Tax & Legal Services leadership team with the appointment of Panayiotis Hadjiconstantinou, who brings international experience in taxation and cross-border structuring. Hadjiconstantinou most recently served as International Tax & Policy Partner at another Big Four firm in the Middle East. Earlier in his career, he worked for PwC in both the United Kingdom and Cyprus, giving him experience across several markets and tax jurisdictions. He began his career with PwC UK in 2008, advising investment management firms on international taxation and structuring. In 2012, he moved to PwC Cyprus, where he worked with private clients, primarily in the energy, commodities and real estate sectors. Alpha Bank will unveil its nine-month financial results for 2026 on October 30, 2026, while initiating a board committee restructuring following a director’s departure, the Greek lender confirmed in announcements released this week. The financial results press release will be made available at 8.00am Athens time, or 6.00am London time, on October 30, 2026, via the bank’s website and the Euronext Athens website. An analyst and institutional investor conference call is scheduled to take place at 12.00pm Athens time, corresponding to 10.00am London time, on the same day, with full participation details to be released closer to the date. In a separate structural development, independent non-executive board member Elanor Hardwick resigned from her position on the board of directors and its associated committees, with her resignation taking effect on October 1, 2026. DCO Secretary-General Deemah AlYahya has been appointed to a United Nations high-level panel examining freedom of transit for landlocked developing countries, the UN has announced. UN Secretary-General António Guterres appointed AlYahya to the High-Level Panel on Freedom of Transit for Landlocked Developing Countries (HLP-FoT), making her the only Saudi representative and the only representative from the Arab region on the panel. The DCO counts Cyprus among its member states, giving the appointment a direct connection to the country and its international digital cooperation agenda. The DCO secretary-general visited Cyprus in June, using the trip to strengthen cooperation with Cypriot institutions and international partners while highlighting the island’s position as an emerging digital hub in the Eastern Mediterranean. Cypriot investment firm Demetra Holdings Plc warned on Friday that its nine-month profit for 2026 is expected to be lower than in the corresponding period of 2025, mainly because of losses from its investments on the Cyprus Stock Exchange (CSE). The company said the warning was based on the indications available to date and was issued to keep shareholders and the wider investment community informed about its expected financial performance. “Based on the indications available to date, the group is expected to record a profit for the nine-month period of 2026 reduced when compared with the corresponding period of 2025,” Demetra said. The company attributed the expected decline in profitability mainly to a loss expected from its CSE investments, compared with the gains generated by those investments during the same period last year. The group said its nine-month 2026 results will also include a gain of more than €6 million from the recognition of negative goodwill arising from the acquisition of a subsidiary. Genikes Insurance on Friday announced that it has renewed its support for the Cyprus Fire Service this year by providing electrolytes, energy bars and operational equipment to help personnel during prolonged emergency operations. The company said the initiative was aimed at providing practical assistance to Fire Service members who can be required to work for extended periods in difficult conditions, particularly during periods of increased wildfire risk and high temperatures. Genikes Insurance has also donated individual operational equipment backpacks to the Special Disaster Response Unit (EMAK), which it said would help members transport and use essential equipment when responding to rescue operations. The company said the support was particularly important during periods of heightened wildfire risk, when Fire Service personnel can face prolonged operations in challenging conditions and high temperatures. MHV Mediterranean Hospitality Venture Plc on Friday reported a net loss of €5.07 million for the six months to June 30, 2026, narrowing significantly from a €10.22 million loss in the corresponding period of 2025, despite lower overall revenue and the impact of the Middle East conflict on its Cypriot hotels. The group’s operating result improved substantially, with operating profit reaching €639,772, compared with an operating loss of €6.70m in the first half of 2025. However, higher finance costs, which increased by €1.94m to €4.34m, weighed on the bottom line. MHV said its business had experienced a steady recovery since May after the escalation of the conflict in the Middle East affected hotel performance, particularly during March and April. The group said the geopolitical situation involving Iran had affected the performance of its Cypriot hotels during the first half of 2026, while management believed the negative impact would be contained until the end of the year. Cyprus’ current account deficit widened to €1.30 billion in the second quarter of 2026, according to Eurostat, contrasting with a substantial surplus recorded by the European Union as a whole. The deficit was the largest recorded by Cyprus across the five quarters covered by the latest data, having stood at €0.70bn in the second quarter of 2025, €0.20bn in the third quarter, €1.20bn in the fourth quarter and €1.10bn in the first quarter of 2026. The latest figures showed that Cyprus’ current account remained in deficit throughout the entire five-quarter period. The current account records transactions between an economy and the rest of the world involving goods, services, primary income and secondary income. Retail sales volumes in Cyprus rose by 7.0 per cent year-on-year in August, pointing to continued strong growth in consumer activity, according to data released by the Cyprus Statistical Service (Cystat) on Friday. The Turnover Value Index increased by 9.3 per cent compared with August 2025, while the volume index, which strips out the effect of price changes, rose by 7.0 per cent. Over the first eight months of 2026, retail turnover value increased by 9.3 per cent, while sales volume was up 6.4 per cent compared with the same period last year. Non-food goods were among the strongest performers, with sales volumes rising by 11.2 per cent in August and 9.8 per cent over the January to August period. The annual Thalassa festival will return to Limassol on Saturday, October 10, bringing together more than 30 public and private bodies to promote Cyprus’ maritime sector and the opportunities offered by the Blue Economy, organisers said on Friday. The festival, which will be held at the Seafront Multifunctional Park on Limassol’s Molos, will open at 9am, with President Nikos Christodoulides due to officially open the event at 10am. Deputy Minister of Shipping Marina Hadjimanolis said the festival had become an established event for Limassol and Cyprus after four successful editions and attracted large numbers of visitors. “Our aim through the festival, which carries the slogan ‘Experience the sea, discover shipping’, is to bring the public closer to the sea and highlight the importance of shipping and the Blue Economy for the development and prosperity of Cyprus,” Hadjimanolis said. She explained that this would enable “citizens, and particularly young people, to discover the sea, not only as a source of recreation and sport, but also as a field of knowledge, studies and professional opportunities” . Bread, baby food, coffee, milk, meat and sugar will be subject to a zero VAT rate from October following the approval of a relevant decree by the Council of Ministers. According to the tax department, the zero rate will apply to frozen or chilled meat products from October 1, 2026, until May 31, 2027. These will include beef, pork, sheep and goat meat. Processed meat products, including marinated and smoked meats, sheftalia, chicken nuggets and sausages, will continue to be subject to the existing reduced VAT rate. The zero VAT measure will be extended to other products from October 12, 2026, and will remain in effect until May 31, 2027.