International interest in Cypriot casino resort
The licence to build a casino resort in Cyprus has attracted interest from at least six international companies. The Cypriot government’s deadline for expressions of interest in the project is 18 December 2015, after which three bidders will be put forward to the second round.
Cyprus’ Tourism Minister Georgios Lakkotrypis explained, “We aim to grant the licence by mid-2016 and it will come into effect from day one, so the winning company will have every incentive to move quickly”.
The successful applicant will be granted a licence for 30 years and will have a period of exclusivity for 15 years, both of which will begin as soon as the licence is issued, according to the Minister’s statement.
Local media in Cyprus has named the following companies as being interested in the project:
-Hard Rock International (Florida, US)
-Sun International (South Africa)
Global Betting and Gaming Consultant’s Director Lorien Pilling commented, “The licensing process comes at an uncertain time in the geo-political situation in the region. Not least of these is apparent progress in the resolution of the “Cyprus problem”, which would re-unify the country.”
UK Foreign Minister Philip Hammond held meetings in Cyprus in November 2015 and stated afterwards: “The leaders of both communities in Cyprus have created a sense of hope, a sense of momentum towards a solution to the long-standing Cyprus problem”.
But there have been false dawns before on this issue and Cypriots will believe progress when they see it. But a unified island does open up new potential locations for a casino not currently available because of the political situation.
Cyprus also lies close to the Middle East war zone of Syria and is home to a UK airbase. The French navy has also sent its Charles de Gaulle aircraft carrier to the eastern Mediterranean to support coalition operations in the region. The Russian navy is also increasing its presence there too. In the immediate term, these events could hurt the island’s tourism sector. It is hard to predict what the region will look like in 2-3 years when any new resort might be nearing completion.
The new Cypriot casino could also face competition from a new casino in Eilat in nearby Israel. Israeli Tourism Minister Yariv Levin has said that even if legislation permitting casinos were passed any new casino would not open before 2020.
Given the relative scarcity of new casino licences in Europe, attracting only half a dozen expressions of interest for the Cypriot project so far is disappointing. But there are numerous risks attached to the Cypriot market which might be causing a few operators to hold onto their chips.