Cyprus could redirect money from its Thalia 2021-2027 programme to support tourism businesses affected by the conflict in the Gulf and wider instability in the Eastern Mediterranean, the European Commission confirmed.

The clarification followed a parliamentary question by Cypriot MEP Michalis Hadjipantela, who warned that the regional crisis had already led to booking cancellations, weaker demand and growing uncertainty across the tourism sector.

Hadjipantela said that “the disruption was placing pressure on hotels and smaller tourism businesses, while threatening a sector that remains one of the main pillars of the Cypriot economy.”

He called on the Commission to examine whether existing European funding instruments could be activated and whether greater flexibility could be provided under EU state aid rules to help affected companies.

In its response, the Commission said Cyprus may use resources available through Thalia 2021-2027, the country’s cohesion policy programme, to support small and medium-sized enterprises, including those operating in tourism.

It added that funding could be reallocated by the Cypriot authorities through an amendment to the programme and said discussions were already taking place with the relevant government departments.

Hadjipantela described the Commission’s response as a substantial step, saying it confirmed that European options were available to provide support to the sector.

“We must not allow available funds from the Thalia programme to remain unused,” he said, calling on the government to proceed immediately with the necessary amendments so the money could be directed towards tourism businesses affected by the crisis.

He added that companies operating in the sector should not be expected to carry the financial consequences of an international geopolitical crisis alone.

“Timely intervention is crucial for protecting employment, the viability of small and medium-sized enterprises and maintaining the competitiveness of Cypriot tourism,” Hadjipantela concluded.