Cyprus could lose 20 per cent of tourism under EU green rules

Air travel to Cyprus by 2035 could be so prohibitive due to green commitments that the island could lose 15-20 per cent of its tourism and 1.7 per cent of its GDP per year, Transport Minister Yiannis Karousos said on Wednesday.

Karousos and deputy shipping minister Vassilis Demetriades were in Brussels to take part in a discussion on the impact of the proposals being discussed at European Union level on transport pollution.

“If the proposals are implemented as they are, they will cause additional costs to the airlines that will be borne by the consumers, while the cost of maritime transport will increase and hence the cost of imports,” he said.

Cyprus had analysed the effects on the country and is proposing regulations that would limit these effects.

The measures as they stand are part of the ‘FitFor55’ legislative package, which contains measures and proposals aimed at achieving the European Union’s climate neutrality by 2050, which presupposes the reduction of greenhouse gas emissions by at least 55 per cent by 2030.

Karousos said if allowances are not made for Cyprus, it would “face a competitive disadvantage”, as the cost of a flight to Cyprus by 2035 would be much higher compared to third countries, such as Egypt and Turkey, non-EU members.

“The measures, which will take effect from 2025, are estimated to cost the airline industry $220 million a year, while in 2030 the cost will rise to $520 million, with estimates that the total cost in 2035 will reach $821 million,” said Karousos.

“These costs will be transferred to passengers, which will have negative consequences for tourism and the economy.”

It is estimated, Karousos added, that Cyprus, should its concerns not be taken into account, would lose about 15-20 per cent of tourism and there would be a reduction of 1.7 per cent in GDP per year.

Demetriades said that similarly shipping was the second most important sector after tourism and even though shipping should contribute to reducing emissions, the EU proposals as presented would have disproportionate costs for the country overall.

“As you know, all commercial inputs in Cyprus – all goods – are transported by sea, and it is estimated that the cost of maritime transport will increase by about 25 per cent by 2032,” he said.

“In the contacts with both MEP coordinators and rapporteurs of the relevant legislative proposals, as well as with representatives of the European Commission, we highlight the peculiarities of Cyprus as an island state and submit suggestions for their improvement, especially regarding the issue of emissions trading,” he added.

Demetriades said there was another way in the shipping sector that emissions could be calculated and distributed that could mitigate some of the issues.