Chinese Investor Pulls Out Of Old Larnaca Airport Deal

The government has received a letter of termination of interest in developing old Larnaca Airport from Chinese investor Yang Qi, said Government Spokesman Stefanos Stefanou.

The latest news comes amid an investigation launched into former head of the president's diplomatic service Marios Ieronymides, whose wife was instrumental in negotiating the deal. The official was accused of breaching civil service rules because he was present at negotiations with the Chinese firm and Hermes Airports.

The spokesman blamed political in-fighting for the investor pulling out of the multi-million-euro project, which was to have showcased Chinese products at the old airport terminal. No reasons were given for the termination of interest, and efforts are still ongoing to push the deal forward, he said.

Ieronymides was present in his capacity of director of the diplomatic service at negotiating and signing the deal with FEP. His wife, Tatiana Ieronymidou, may have stepped down as a director of FEP Ltd, but took up a position as shareholder and director of a related company, Far Eastern Phoenix Management Ltd, instead.

In a letter to the president, Ieronymides said his conscience was clear and apologised for not clarifying some of the details to him and for exposing him to criticism from the opposition.

The question remains, why were the negotiations not in the Finance Ministry or Commerce Ministry's hands, given that these are the institutions normally in charge of financial or commercial matters on behalf of the state? And did Ieronymides benefit in any ways other than his wife's compensation at both companies?

Ieronymides went on the record to say that his involvement was purely in the capacity of his friendship with Yang Qi, the businessman behind the whole deal. Government spokesman Stefanos Stefanou has tried to distance the government from the scandal, saying that the deal was made between Hermes and the Chinese company.

The project was signed in principle on March 23rd and is a massive shopping and distribution centre aimed at exhibiting Chinese products. Its cost is 600 million euros and is expected to create four thousand new jobs. The deal is based on a lease for 19 years with an option to extend to 50 years.

More complications arose after the owner of the property - a Turkish Cypriot - condemned the deal as a violation of his rights.

Hüseyin Helvacıoğlu says that Hermes Airports and the government have committed an 'illegal act' by leasing the land without his permission to the Chinese investor.

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