The investment of €1.2 billion in the Larnaca port and marina is unprecedented, and with the current data, it seems to be hanging by a thread.
Until yesterday afternoon, when the telegram given by the Minister of Transport to Kition Ocean Holdings expired, not only was the contentious guarantee for the port not deposited, but the company had also not informed about its intentions.
This is despite the fact that ten days ago there was a commitment to deposit it before the President of the Republic by officials from Aroundtown, which is the main shareholder of Kition.
“Our options are to speak with them tomorrow (note: today) to see their intentions regarding the guarantee, and accordingly we will communicate with the Legal Service,” the Minister of Transport told Phileleftheros yesterday afternoon, noting that the matter will be discussed today in the parliamentary Transport Committee and representatives of the contractor company have been invited to be questioned.
“We are facing a very substantial breach of the contract; it is a very serious situation, and our handling should be equally serious,” Vafeades pointed out, noting that terminating the contract is a complex process.
“What is provided in the contract is that the state takes over the operation of the port and marina from day one. However, the process is complex because there are subcontractors with whom the company made agreements. The contract stipulates that in case of contract termination, the time for the contractor to be removed entirely must be determined. It allows you, that is, to negotiate with the subcontractors to continue the operation of the port and marina.”
He also added that if there are ways to help the contract so that it is not terminated, this will be done, provided that “it falls within the framework of legality.”
Meanwhile, the guarantee of €10 million for the operation of the port expired on January 31, 2024, and without its deposit, as the Legal Service has already advised, the contract cannot remain in force, nor can negotiations with the contractor company continue.
It is recalled that Kition Ocean Holdings had argued that the amount of the guarantee should be €4.2 million and at the same time had submitted a series of requests to make changes to the design and prioritise land development projects. At the meeting at the Presidential Palace on Monday, April 15, Nikos Christodoulides clarified, as Larnaca bodies present had stated, that without the deposit of the guarantee, the contract cannot be in force.
In an attempt, indeed, to resolve the deadlock, it was agreed that the company would deposit a guarantee of €4.2 million, as it was its desire, and subsequently the issue would be resolved through a fast-track dispute resolution process.
The intention to deposit the guarantee had been communicated, in fact, on the same day by Kition Ocean Holdings, expressing optimism that “within this framework of cooperation, pending issues will be quickly resolved, and the start of construction works will be expedited as soon as possible.”
It also committed to “maintaining a spirit of mutual cooperation to ensure the success of the project.”
Nevertheless, for unknown reasons, it did not deposit the guarantee, knowing that a telegram had been given by the Minister of Transport until yesterday, who also publicly announced the state’s decision.
It should be noted that Vafeades had revealed to the Larnaca Development Committee last Friday that the latest instructions from the Legal Service, before Nikos Christodoulides’ intervention, were for the state to terminate the contract with the contractor company.
Developments, as recorded, cause great concern among the Larnaca bodies, as the possibility of a shipwreck is more visible than ever.
The city’s Development Committee, however, has been calling on the contractor company since last Friday to immediately deposit the guarantee for the port.
At the same time, it unanimously decided to call on the state not to proceed with discounts regarding the infrastructure projects included in the contract and not to grant an additional extension for the projects, which are due to start next June.
