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The Minister of Transport, Communications and Works, Mr. Alexis Vafeadis held a press conference regarding the termination of the concession contract for the integrated development of Larnaca Port and Marina, in the presence of the Director General of the Ministry of Transport, Communications and Works, Mr. Antonis Koutsoullis.
The Minister said: "This morning we delivered a letter of immediate termination of the contract for the integrated development of Larnaca Port and Marina to the contractor company. This decision was taken following consultation with the Legal Service, from whom we have been informed that this is a breach of an essential term of the contract, which could not be disregarded. Accordingly, Kition's continued refusal by their actions to renew this guarantee has led us to the decision to terminate the contract immediately. Our action effectively triggers a process whereby the port and marina, this single development, is returned to the management of the State. The State is ready to operate the port without any interruption. It has taken all the necessary measures to ensure that the uninterrupted operation of the port can continue, so that these essential services can continue to serve the needs of Cyprus. We believe that the coming hours and days will show what the future of the project will be.
I have already contacted the Mayor of Larnaca Mr. Vyra. I have asked him to arrange a meeting on Friday with the local community, so that we can set the start of the next phase, that is, solution B, which we have mentioned in the past, which concerns the measures that we will take in order to move directly to the implementation of the project in alternative ways. Since this contract had to be terminated, we have made a commitment that the project will go ahead, and we are activating this intention with the first meeting this Friday. Therefore, our commitment is that the project will go ahead. Unfortunately, it cannot be implemented under this contract, but other ways will be found for it to go ahead."
Asked about this, Vafeades said: "By law, under the Contracts Act, we can only select a contractor through a new tender process."
The minister further noted that the company has not informed the ministry whether it will go to court. "We had set a meeting today at 12 noon," he continued, "to discuss the smooth transition of the port's operation to the state. Kition has decided not to participate in this meeting, but the matter will be settled otherwise."
Asked by a journalist whether interested investors have been sounded out for Larnaca for early 2025, Vafeades replied, "I have said, recently in fact, that there is investment interest in Cyprus. We see it all the time, either from states or from big companies, who contact the government and ask to see if there are projects in which they can invest. Therefore, we are not concerned if there are funds available in funds abroad. We believe that the investor will be found. Therefore, in the process of inviting bids we expect them to participate."
In response to a reporter's comment that a protection of the state was lost because the guarantee was not renewed, the Minister said: "A state right is not lost. That money will be part of the compensation we will seek to receive. It was an essential term of the contract. It will be decided in court on that, but we believe we are entitled to that money and we will claim it."
He also added: "On Friday the state triggered another clause in the contract under which it is also claiming the third guarantee."
Asked if there was any mishandling on the part of the government or a previous government in arriving at this outcome, Vafeades replied, "When a contract does not go the way we wanted it to, something has gone wrong. We have a duty to assess what went wrong, to correct if something needs to be corrected, so that in the next process we do not face the same problems. Therefore, this self-criticism must and will be done."
In conclusion, the Transport Minister said: "The contractor is making some claims as to what kind of problems it is facing in going ahead," and that cannot be accepted at this stage. "It would be an item which would be subject to study if we had the guarantee," he concluded, "if we proceeded to refer the matter to appropriate committees to study it. Therefore, we have not evaluated this matter."
(SAP/GC/EP)
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