cyprus Business, travel, culture and wine in the eastern mediterranean 15.10.11

On the first of Octo-ber the Republic of Cyprus turned 51. Despite undoubted

pride in its achievements since independence – the state now has some of the highest living standards in the European Union – celebration was muted. This has been a difficult year.

The decision to begin drill-ing for hydrocarbon reserves in its Exclusive Economic Zone – Noble Energy of the US began work in late summer – precipitated an aggressive response from Turkey, which dispatched its own research vessel to the area, south of the island. Denying the republic’s right to drill before a solution to the long-drawn-out Cyprus Problem is found, Ankara has said it will also start drilling in the area, as well as to the north of Cyprus.

Turkey’s actions have prompted calls for restraint from the EU and US. Turkey has now said it will freeze relations with the EU once the republic assumes the rotating presidency next July.

Although many observers have given up following the tortuously complex negotia-tions between the Greek and Turkish Cypriots that have continued for so long, the sharp escalation of tensions is a timely wakeup call that solving the Cyprus Problem remains key to regional stability. The latest round of direct

talks, which started in 2008, continues. President Demetris Christofias insists he remains committed to a just solution, telling Turkey’s Milliyet news-paper earlier this year that he was broadly optimistic. “As far as we are from a solution, we are equally close.”

However, Foreign Minister Erato Kozakou-Marcoullis says Turkey’s stance, coupled with backtracking by the Turkish Cypriot leadership on key resolutions – notably UN Security Council Resolution 1251 – has made negotiations hard going.

Another heavy blow for Cyprus was the tragic explo-sion of confiscated Iranian armaments at Mari in July, the worst peacetime disaster since independence. The blast killed 13 people and by devastating the island’s main generator at Vasiliko, knocked out almost half its electricity supply.

On the plus side, the impact on growth and tourism has not

been as bad as initially feared – power cuts were rare over the summer in most resorts – and the Electricity Authority of Cyprus says Vasiliko could be fully functional again with-in two years. However, much damage has been done to the government’s reputation, with many asking why the confis-cated arms were not destroyed or handed over to the UN as requested. The minority Akel government (centre-right party Diko left the coalition af-ter the blast) is now struggling to retain credibility.

Cyprus is also grappling with an economic crisis made more worrysome by its unpre-dictability. Domestic demand, for example, has slowed amid a worsening global picture and an increasingly troubling situ-ation in Greece. For the aver-

age Greek Cypriot, the impact has already been felt in rising unemployment, difficulty in getting credit, and uncertainty within both the public and private sectors.

Although these are dif-ficult days, Cyprus – with its business-friendly legal and administrative system, its stra-tegic location between Europe and the Middle East, low taxes and a well-developed, modern infrastructure – is emphati-cally not Greece.

Tourism is performing very well, with many visi-tors rediscovering Cyprus’s appeal as a safe, value-for-money destination; resorts in Paphos, Ayia Napa and other locations have been near capacity, with visitors from the UK, Europe and, increas-ingly, Russia, leading the way.

January to August revenues were up 16% on last year.

“The Arab Spring has helped us by encouraging many who would before have gone to these countries to come here instead,” says Con-stantinos Mouzouris, a senior representative of the Cyprus Tourism Organisation.

Traditional industries, like private banking and shipping, have also performed strongly. Maritime Cyprus – a leading conference for the shipping industry – packed out Limas-sol’s hotels for three days earlier this month, while the €350-million Limassol Ma-rina, an ambitious residential and leisure development, is exciting investors.

Cypriot entrepreneurs also continue to demonstrate their ingenuity. Earlier this month

news emerged of a concentrat-ed solar-power desalination plant to be developed follow-ing research by the Cyprus Institute and MIT which could have major implications for this and other countries’ en-ergy and water supply needs. And if large-scale hydrocarbon deposits are discovered once Noble Energy reports its find-ings, the potential could be significant for all Cypriots.

Next year, Cyprus will have a chance to shine with its pres-idency of the EU, at which its priorities will include improv-ing food security for poorer nations and boosting relations with the Arab League and the Gulf Cooperation Council.

Little wonder then that although things are tough now, prospects remain positive for a more joyful birthday next year.

Republic is on the right trackBoasting a business-friendly system, strategic location and a modern infrastructure, the island is coping with a series of setbacks. By Justin Keay

This supplement has been produced by Archimedia. It did not involve the reporting or editorial staff of The Times and no endorsement is implied. Contact: hello@archimedia.uk.com

The island’s Mediterranean allure has seem tourism boom this year; President Demetris Christofias, below, has been under fire.

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Cyprus has many attractions but Limassol seldom figures

at the top of visitors’ must-see lists. Overde-velopment after 1974 when thousands of Greek Cypriots from the north fled south, along with a road system ill-equipped to deal with the explo-sion in car ownership, have undermined the city’s charms.

But all this is chang-ing, thanks to the island’s largest-ever investment.

Marina projectbreathes new lifeinto Limassol

investment ambitious project gives a boost to cyprus’s reputation for attracting quality investments.By Justin Keay

2 cyprus

The €350-million Limassol Marina project is giving vital impetus to the city’s regeneration.

Work has already be-gun on the €350-million Limassol Marina project, giving vital impetus to the city’s regeneration – providing coherence to an urban and waterside environment that was chaotically organised – and more broadly, to the island’s economy.

Sophia Paraskeva, public relations manager for the marina, says the first of what what will be 188 apartments and 85 villas will be ready by the end of next year, and the

643 berths, shops and restaurants will be ready in 2013, with the project scheduled for completion in 2014.

The marina will pro-vide a much-needed boost to the city. On the back of it, town authorities are planning a series of public works to improve roads and municipal areas. A walkway is planned to Limassol Castle, while a new beach will replace disused warehouses.

The project also provides a further boost to Cyprus’s reputation for attracting quality invest-ment projects, with the shareholders a roll call of the island’s leading com-panies, including Cybarco, Joannou & Paraskevaides, and CADS Holdings.

“As long as we play our cards right, the funda-mentals are very good. The underlying invest-ment climate, as well as the rate of capital inflow, demonstrate this,” says Andreas Charalambous, director of economic research at the Ministry of Finance.

Last year, hardly a stel-lar one for foreign direct investment anywhere, Cyprus managed to attract €3.6 billion (£3.15 billion) in FDI, against €4.1 bil-lion in 2009. These figures represent solid increases on previous years: in 2007 and 2008, for example, FDI inflows were €1.6 bil-lion and €2.8 billion.

In terms of sectors, financial intermediation (accountancy, consul-tancy and other business services) leads the way – including capital inflows from Russia estimated last year at around €1.5 billion – followed by trade and repairs and real estate.

However, some argue that the composition of FDI and investment

in Cyprus is changing. Efthyvoulos G. Paraskev-aides, head of Joannou & Paraskevaides, an interna-tional contracting giant, believes it is undergoing a subtle transformation, moving away from its de-pendence on tourism and associated services.

“Cyprus is growing closer to its rightful posi-tion strategically in the Eastern Mediterranean by upgrading [its wider economy] on the network and infrastructure of tour-ism,” he says.

Particularly for the ser-vices industry, low taxes have played a major role in attracting investors. At a time when competing destinations are raising corporate taxes, Cyprus’s 10% – one of the lowest in the EU – goes a long way towards explaining why at the most recent count more than 237,000 firms are registered here. Loca-tion is another magnet. The island’s strategic position between Europe and the Middle East, coupled with a well-de-veloped infrastructure, an entrepreneurial culture and a well-functioning administrative and legal system, look particu-larly attractive at a time of

global uncertainty. Reputation works as

another draw. A maritime industry hub, Cyprus has emerged as a centre for ship management services, aided by an EU-approved tax regime that exempts ship owning as well as ship management activities from income tax.

Certainly when they are known – probably by the end of the year – the results of initial drilling by Noble Energy in the waters off southern Cy-prus could have profound implications for FDI. Even before, however, en-ergy trading firm Vitol has undertaken to construct a major new energy storage terminal in Vasiliko, on Cyprus’s southern coast. The Netherlands-based company’s initial invest-

ment is €100 million. The first phase, due for competion late next year, will comprise 345,000 cubic metres of storage for natural gas, oil and oil products, increasing to 550,000 cubic metres in the second phase, reinforcing the republic’s status as an energy storage and trading hub.

The discovery of major offshore hydrocarbon deposits would attract energy companies from around the globe. “Indica-tions are very positive and if large-scale reserves are found then we have a new dimension to the econo-my,” says Phidias Pilides, head of CIPA, Cyprus’s investment agency.

Looking forward, Limassol Marina has en-couraged similar projects elsewhere in Cyprus, with marinas now planned or being built in Ayia Napa, Paphos and Larnaca. Suc-cess breeds success and Mr Pilides is confident that the positive mood regarding investment will lead to its continuation.

“Throughout the financial crisis, Cyprus has shown the ability to con-tinue attracting FDI and we are hopeful that we will be able to maintain this.”

particularly for the services industry, low taxes have played a major role in attracting investors

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A lthough the global downturn has affected

the Cyprus holiday home market, some resorts and sectors are defying the trend, nurturing new international demand as developers go distinctly upmarket with their latest villas, townhouses and apartments.

Research by the London-based Royal Institution of Chartered Surveyors suggests that while prices for Cyprus holiday homes roughly doubled between 2002 and 2008, their values have subsequently dipped.

The recent RICS European housing market survey reports that since 2008 holiday-home values are down 20% for the best homes in the most sought-after locations and are up to 40% off for poorer-quality homes in estates in peripheral locations.

Yet despite these diffi-culties, the island remains stubbornly popular and now seeks to reinvent itself for the future.

It remains in the top 10 overseas locations favoured by Britons to buy holiday homes, according to a survey by Savills, the estate agency, and holiday lettings website www.homeaway.co.uk.

“Despite the distance, the excellent flight con-nections to Paphos and

High-end homes draw a global audienceproperty in a buyer’s market, builders are moving upmarket with top-end developments. demand at the top stays firm. By Graham norwood

“transactions for top-end properties are 40% up on last year and come from all over the world.”

Pafilia’s Minthis Hills development

Larnaca, and easy driving make it a highly accessible destination for British buyers,” says Rebecca Gill of Savills, the researcher behind the survey.

According to Ms Gill, Cyprus is considered to be a safe and stable destination for buying property. More than 80% of UK-owned properties in Cyprus are coastal, and traditionally Paphos has led the market, she says.

“Properties on golf resorts close to a city and beach are popular. The cli-mate permits year-round golfing and consistent rental potential. From a resale perspective, how-ever, the delay in release of title deeds from the [Cypriot] Land Registry can slow down the second-home purchasing process. Newly built properties are therefore becoming more attractive,” says Maribeth Davies, international sales manager at Hamptons International.

British property pur-chases are down currently in response to the global recession and a weak pound against the euro.

Sustained interest in Cyprus from Russia, the Middle East and Eastern Europe — despite volatile values and fears of over-development — is hardly surprising given the fiscal advantages for high-net-worth investors.

Corporation tax is 10%,

one of the lowest in the European Union, while recently initiated double taxation treaties have encouraged substantial international investment. This means the top end of the housing market, especially the exclusive holiday home sector, is performing significantly better than lower down.

In response, more top-end developments are now being built.

One example is Limassol Marina, under construction by developer Cybarco with 274 apart-ments and villas and 650 berths, including space for some mega-yachts.

Next year there will be

an even more spectacular development in Limas-sol – the Landmark Tower, a residential project by luxury developer Pafilia to a design by the architects behind Dubai’s Burj Al Arab. It is unsurprising to discover the Landmark is set to be the tallest build-ing in Cyprus.

Residential golf resorts are also being con-structed, notably Minthis Hills, Pafilia’s flagship development near Paphos. It boasts 600 units with strong environmental cre-dentials — local dry stack stone and timber will be used on homes ranging from four-bedroom villas to townhouses, conform-

ing to a strict master plan and design code.

Minthis Hills is part of what some see as a new breed of upmarket developments in Cyprus. It will have a concierge service, a clubhouse with the facilities of a five-star hotel and an extensive leisure and shopping infrastructure, all in 1,200 acres of landscaped parkland – the equivalent of three times the size of London’s Hyde Park.

The homes are designed by Australian architects in a modern, international style with large windows, private courtyards and water features.

Pafilia’s founder, Elias Eliades, insists Minthis Hills bears no relation to the low-quality over-de-velopment characterising other parts of Cyprus in recent years. “The future of Cyprus is to be a desti-nation [for the discerning] and to avoid the mistakes of 2000 to 2008. Cyprus [should] not be a destina-tion for cheap tourism.”

Trends suggest this is likely to be the route that will see the island prosper.

“Transactions for top-end properties are 40% up on last year and come from all over the world. This is comforting for new owners who may eventually want to sell; they will have a global audience of prospective buyers,” explains Tony Nathanael, Pafilia’s com-mercial director.

“Minthis Hills and Landmark emphasise quality, luxury and ser-vice,” says Mr Nathanael. “Cyprus has never seen this before, but it is the future for the island.”

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economy political parties pull together to produce a package of measures fostering stability. By Justin Keay

retirement fortune health resort is planning a major project for visitors and permanent residents. By Helen Jones

T he world’s population is ageing rapidly. By 2050, the number of people over the age of 60 will grow from 500 million today to

two billion, and older people are expected to outnumber younger ones for the first time in history. To meet changing demands for housing and health care, a growing number of upmarket retirement communi-ties have been springing up across the US and Asia and are now gradually making their way to Europe.

Equipped with houses and apartments, health spas, social clubs, sports facilities, shops and restaurants, they attract fit, active, affluent baby boomers who want to enjoy their retirement but also need the reassur-ance that medical facilities and long-term care are available when needed.

Cypriot entrepreneur Andreas Kaisis, who has interests in tourism, finance, property and technology, is tapping into this demographic trend with the development of the Fortune Health Resort in an area of outstanding natural beauty in the hills near Limassol. With the motto “live younger, longer,” the resort, which is expected to open

in the second half of 2015 (master plans will be presented to the Cypriot authorities this month), aims to promote good health and a sense of well-being among its guests. It will include a five-star hotel for short-term visi-tors, a health spa, medical and rehabilitation clinics, restaurants and bars, an organic farm to provide fresh produce for the resort and a village of villas, apartments and “assisted liv-ing” bungalows for permanent residents.

Mr Kaisis has been working on the plan-ning of the project with Florida-based Buena Vista Hospitality Group, which has expertise in health resorts and residential communi-ties in the US.

“We are seeing the rapid growth of world-class retirement communities in the US and elsewhere due to an ageing population. We have examined similar resorts overseas and discussed what works with their operators. Cyprus could definitely be at the forefront of this type of development in Europe,” Mr Kaisis says.

The project, which is budgeted at more than €700 million, has already attracted interest from Middle Eastern investors and is expected to bring in British investors, too. “The close ties between the UK and Cyprus

lead to the natural conclusion that British investors will participate in this pioneering project – a project that is at the forefront of trends in international tourism, in a coun-try with a [business] environment, tax and legal regimes that are very similar to the UK,” says Mr Kaisis.

Health and wellness tourism – which includes everything from visiting a spa for a week of pampering to a trip to a medical centre for cosmetic surgery – is a booming industry estimated to be growing by 15% a year in Europe and America. While health tourism is still in its infancy in Cyprus, the government is encouraging investment in the industry and sees it as an increasingly important sector and one that could develop the island’s tourism potential beyond year-round sunshine and beautiful beaches.

Mr Kaisis says guests at the Fortune Health Resort are expected to stay anything from a week for a relaxing break to perma-nent residency. “Our guests may just want to relax, play some golf and enjoy some beauty treatments for a week or so, or they may wish to have some cosmetic or dentistry treat-ment, or they may be long-term residents

who want to enjoy the facilities and feel comforted that medical care is available close to their retirement home,” he says.

Permanent residents will have

access to a range of activities and classes from ancient history to sport and can take advantage of the site’s cinema and theatre and other leisure facilities. As well as medical and nursing care, housekeeping, laundry and property maintenance will be included.

Cyprus, with its great climate, easy flight connections, well-developed infrastruc-ture and widely spoken English, is already popular with the British. It is estimated that around 100,000 Britons either have holiday homes or have retired to the island to take advantage of low taxes (on pensions, bank deposits and shareholdings, and no inheri-tance tax) and better weather.

“The close ties make it particularly attrac-tive to British retirees,” Mr Kaisis agrees.

He expects that the resort will attract guests and permanent residents not just from other parts of Europe but also from Russia and the Middle East. “The combi-nation of facilities and services at Fortune Health Resort will provide an environ-ment and an experience that is different from anything currently found anywhere in Europe and will meet demand for new ways of enjoying a healthy, active retire-ment,” he says.

Republic actsto provide upliftfor the economy

Refuge for retirees, seekers of wellness

“we are seeing the rapid growth of world-class retirement communities in the us and elsewhere due to an ageing population.”

Y ou don’t have to look far for evidence of the slowdown in Cyprus. Along most

main roads, advertising hoard-ings shout discounts of as much as 30% on newly built proper-ties. Although some markets have held steadier than others, the fear remains that the real estate market is set for bumpy times.

Much the same could be said of the broader economy. After years of respectable growth, Cyprus is now encounter-ing a slowdown akin to other EU countries. GDP growth was 1.7% in 2009 and 1% last year, but the government acknowledg-es that it could be zero, or at best 0.5%, this year.

“As an open economy facing a difficult external environment because of problems in Greece and the eurozone, there is no doubt Cyprus is facing challenging times,” says Andreas Charalam-bous, director of economic re-search at the Finance Ministry.

Problems have been made worse by the need to service some €1.4 billion in loans at higher-than-expected rates of interest and long-term yields on Cyprus bonds have risen well above 10%, against just 4.5% earlier this year. Cyprus must also make good the dam-age to the Vasiliko power sta-tion (estimated at some €600-€700 million) for which it will

probably need EU support. Amid growing concerns

about its economy, leading credit-rating agencies down-graded the republic at the end of July: Standard & Poor’s to BBB+ from A- and Moody’s to Baa1 from A2.

Optimists point to the fact

that political parties have pulled together in the face of the economic crisis. A package of austerity measures – in-cluding public spending and public-sector wage cuts – was agreed in mid-August, although in passing the 2012 budget, parliament rejected a proposal to increase the value-added tax 2% to 17% for fear this might further depress the economy. After a budget deficit of around 6% this year, the figure for 2012 is now expected to be at best 2.3%, although the IMF says 4.5% is possible without further spending cuts.

“The government must strike a balance between put-ting public finances on a sus-tainable path and not damaging future growth prospects,” says Mr Charalambous.

It must also ensure it doesn’t raise corporate taxes or do anything else to reduce a still-strong appeal to foreign investors, who have invested some €7.7 billion over the past two years.

The big concern for Cyprus is the extent to which the crisis in Greece and the EU impacts upon its economy. Cyprus’s banking sector is equivalent to 700% of GDP, which means serious problems within the sector would have great impact on the broader economy.

Fears have grown as it becomes increasingly clear that owners of Greek debt will have to accept some losses on their

holdings. The Bank of Cyprus and Marfin Popular Bank have already been downgraded by Moody’s and Standard & Poor’s, which both empha-sise the extent of local banks’ exposure to Greek debt, around 40% of their total.

Mr Charalambous maintains that it is important to keep per-spective. “Despite the problems, all banks operate profitably even within Greece and have a strong capital position,” he says, pointing also to central bank measures aimed at reinforcing regulation and strengthening the resilience of the sector.

Despite the problems, Cypriot banks continue to operate profitably.

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Online pioneer provides a novel productBusiness services entrepreneur creates virtual trade shows, helping businesses to access clients, partners, manufacturers and suppliers.

Taking part in inter-national trade fairs is time-consuming, expensive and often

involves a lot of travel, which is why Cypriot entrepreneur Andreas Kaisis developed BusinessGlobal.com – a pio-neering company that runs on-line, permanent, interactive, virtual trade shows that enable businesses to access potential clients, partners, distributors and suppliers worldwide and around the clock.

His aim was to recreate the experience of a world-class trade show via the Internet. Following the success of the BusinessGlobal.com platform, Mr Kaisis has now launched ExpoGlobalOnline.com, a net-work of national expo portals.

Through this online “expo park” concept, online visitors will be able to access per-manent trade shows in 180+ countries and 60 industry sectors from agriculture to wellness, energy, construction and health and fitness, among others, without leaving their

desks. ExpoGlobalOnline.com includes a business directory, extensive reports on doing business and investing in each of the countries of the network, and virtual forum and library support services.

Mr Kaisis start-ed his own business when he was just 16. From humble beginnings he created a business empire covering international trade, tourism, technol-ogy, investment, fi-nance and property. In 1996, he set up the International Merchandising Centre, a €40 mil-lion international exhibition centre and whole-sale trade facility in Nicosia and it was this experience that convinced him that there was room for an online version.

“The idea came from a blend of my own experiences and a deep knowledge of international trade through

exporting Cypriot products to over 40 markets, leading a very diversified business with interests in almost every area of the economy, and exten-sive international business

travel,” he says. The business is already well

established in China, India, Saudi Arabia, Qatar and Tur-key, but ExpoGlobalOnline.com continues to establish partnerships with regional organisations and businesses worldwide.

Through a strategic partnership with H.E. Sheikh Jabor Bin Hamad Bin Jassim Al-Thani, a member of Qatar’s ruling family, it has created Gulf Expo Online, which is

developing all nine portals for the Gulf countries, including Saudi Arabia and Qatar which are already operational. It has also formed links with the EU organization Euro-Med TDS, which aims to promote trade between EU member and non-member countries

of the Mediterranean region. Together they have created EuroMedExpoOnline.com – a regional portal.

The company recently launched UK Expo Online.

“UK subscrib-ers have started coming in and the indications are that the UK will develop into one of our strongest markets in the next five years,” says Mr Kaisis. So far British exhibi-tors from a range of sectors have signed up, includ-ing engineering,

travel and tour-ism, consumer

products and medical supplies. Mr Kaisis expects the UK portal to cover more than 30 different industry sectors over the next five years.

Online exhibitions offer several advantages in tough economic times – they elimi-nate travel and accommoda-

tion costs for exhibitors and visitors and there is no need to ship exhibition material or construct physical stands. In addition, a virtual trade show can be accessed 24 hours a day, year-round and isn’t con-strained by time zones.

“It took tremendous efforts to educate our clients about the benefits,” Mr Kaisis says. “But they now see that our virtual events can make their businesses global and at a frac-tion of the cost of participating in a physical exhibition.”

So far, €20 million has been invested into the Expo-GlobalOnline platform, and by the end of 2012, when all 180+ national expo online portals will be up and running, that figure is expected to rise to €40 million.

Mr Kaisis says that his aim is to build the largest global network of virtual exhibitions and business support services that will offer companies a way of expanding their busi-nesses despite a difficult economic climate. —HJ

Lobby of UK Expo Online. Its backers anticipate strong demand from UK businesses.

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Cyprus is one of those destina-tions that feels forever famil-

iar. Many Britons know it for its reliable year-round sun, splendid beaches and fine resorts and re-member that the friendly locals speak English and drive on the left.

If you haven’t visited Cyprus in a while, however, it may

surprise you. Sure, you can

still find all-day English breakfasts

on some Limas-sol menus and

all-night clubbing in Ayia Napa, but

Cyprus has evolved to offer plenty for the

more discerning holiday-maker. The island is now considered one of the best places in Europe for luxury accommodation and spas. It’s also the top overseas destination for British couples wanting to marry abroad.

Cyprus has, of course, always been more than just a beach holiday. It’s a varied island with a rich culture and 10,000-year history, the mythical

birthplace of Aphrodite, goddess of love, and a gateway from which Christianity was spread.

What’s more, you need not stray far from the beaches to see its cultural highlights. From lively Limassol you can reach the Greco-Roman amphitheatre at Kourion, or the wine village region of Krassochoria, or visit a medieval castle. Within 20 miles of Larnaca you can be in the pretty village of Lefkara where women sit in the street creating lace on their laps.

Paphos, popular with romantics and retirees, boasts strikingly well-preserved mosaics dating back to the 2nd century and depicting scenes from Greek mythology. Nearby are the Tombs of the Kings, 300 BC burial chambers with Doric col-umns carved from solid rock. Regular open-air concerts and operas are staged in the harbour.

Inland is Nicosia, Europe’s last divided capital, and the island’s heart for the past 1,000 years. The Green Line, a UN-patrolled schism across the city, separates

Although beyond its beaches much of its appeal lies in history and nature, Cyprus is keeping its modern tourism as-sets fresh. A new airport opened in Larnaca in 2009, and more recently the city’s waterfront has had a makeover includ-ing a new promenade. A state-of-the-art port will see Larnaca become the main cruise terminal by 2015. In Limassol a spectacular new marina will welcome its first yachts next year. There’s also good news for golfers with two international-standard courses being added to the existing four.

“Limassol now looks better than it has ever done. Along the coast what you’re getting is the smartening up of the island,” says Noel Josephides, managing director of specialist tour operator Sunvil.

Small scale, luxurious and inland has mean-while been the trend of recent accommodation developments. “In the last three to four years boutique hotels have come onto the market,” says Mr Josephides.

the Greek south and Turkish-occupied north. It is often overlooked by tourists but has a wonderful old city with narrow streets and ornate balconies, surrounded by Venetian sandstone walls. There are craft shops here, modern malls and excellent restaurants. Also worth a visit is the Cyprus Museum which has the island’s most important collection of archaeological finds from the Neolithic age to Ro-man times.

Cyprus’s contrast-ing topography means you can swiftly pass through arid, Mars-like landscapes to fragrant vineyards or forests. Walkers are drawn to the valleys, gorges, rare flowers and sea views of the undeveloped Akamas peninsula at the island’s northwestern tip. In the central southwest, the pine-tree-covered Troodos Mountains have hike and bike trails lead-ing to UNESCO-listed Byzantine churches featuring fine frescoes. It’s even possible to ski here between January and March.

6 cyprus

For many first-time visitors to Cyprus the island’s appeal lies in its offer of an uncomplicated sunny

escape from colder climes. How-ever, for those who know it better, it is another, rather different Cyprus that holds them in thrall.

Just over 40 years ago, a young British artist stepped ashore in Li-massol. With no preconceptions of where he wanted to go, he eventual-ly found himself in the village of La-neia, in the Troodos Mountains, in a house that has remained his home ever since. Today, he has Cypriot citizenship and travels regularly around the island for inspiration. Michael Owen is now one of the is-land’s best known painters and this July, his 40th anniversary here, was marked by an exhibition attended by President Demetris Christofias. His works speak of his love for the landscape, where colours and light work together to remarkable effect.

From the attic window of the house he shares with his wife Jacqueline you can see the majestic Mount Olympus, while beyond is the mountain resort of Platres, a haven for hikers and those wanting quiet and undisturbed beauty.

“Look at those colours – at this time of year they change so fast it is spectacular. There is a strong atmospheric beauty about this island that makes it unique,” Mr Owen says.

Fortunately for travellers, you don’t have to be an artist to expe-rience this other Cyprus.

Laneia is a good place to start, with its immaculate cobbled streets, wooden balconies and strong blues evoking the Cyprus sky. One can see aged olive and wine presses here, evidence of the agro-industries that continue to define villages across the High Troodos. Lunch in one of the tavernas offers a range of local dishes and wine at modest prices.

Beyond Laneia, driving higher into the Troodos, this other Cyprus opens itself up. The Cyprus Tourism Organisation offers publications de-voted to agro-tourism, listing rustic bed and breakfasts, houses and small hotels where you can experience local traditions and where nightlife

is a game of backgammon accompa-nied by a glass of the powerful local spirit, zivania.

Platres and the so-called Troodos Square have the largest number of accomodations – the latter has hotels with great views across the mountains and down to the coast. Omodos, in the heart of the Commandaria wine region, is a hub of activity and an ideal place to buy local handicrafts and food-stuffs and visit the “open homes” of the residents. Also worth visit-ing is Kakopetria, perhaps the only village to have a river running through it, and famous for its cobbled streets, wooden-balconied stone houses and delicious fresh trout. Try it with garlic butter at the Mill Hotel and Restaurant, which has great views, or at the Lindos Inn, an atmospheric cosy hotel created by knocking several stone houses together.

If time permits, a drive up to the Akamas penisula in the far north-west reveals an even more remote Cyprus, much of it accessible only by 4X4s, or hiking. This is a wilderness

of rugged hills inter-

Visitors will find surpises in store

spersed with stunning coastal views. Be sure to visit the idyllic Baths

of Aphrodite, complete with eucal-pytus trees bought by the British from Australia in the early colonial period. Stay in one of the traditional houses restored under the award-winning Laona Project, sustainable eco-tourism at its best.

Michael Owen is still a regular visitor to Akamas. “It’s like nowhere else I’ve been.” —JK

Rural Cyprus offersan undisturbed beauty

Villages like Ikos offer another view of Cyprus. Above: the pristine wilderness of the Akamas peninsula.

explore discerning travellers can have a taste of luxury and sample ancient culture, a colorful history amid great natural beauty. By Debbie Ward

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“They use local ingredients in their restaurants and concentrate on the history and culture of the area.”

Among the newcomers is Ayii Anargyri Natural Heal-ing Spa Resort housed in a former monastery near Polis. It utilises the same sulphur springs monks used to treat ailments as far back as the 17th century. The boutique Library Hotel & Wellness Re-sort in Kalavasos near Limas-sol also occupies a heritage building. Each room is named after a famous writer and boasts a marble bathroom, while the cosy library lounge is stocked with novels, music and classic films.

Big family hotels, too, are upping the standards. At Ayia Napa, Kanika Hotels’ Olympic Lagoon Resort has expanded this year from 259 to 340 rooms and added

extensive leisure facilities. “We have invested close to 15 million [euros] in order to convert the hotel into a des-tination resort,” says Spyros Karaolis, Kanika Group ex-ecutive chairman. “You have seven swimming pools and five restaurants to choose from. It’s an all-inclusive, but it’s a high quality all-inclu-sive, you are invited to dine in each of our restaurants.”

The tourist office website is www.visitcyprus.com

Choose a Kanika Hotel in Cyprus and take advantage of a 20% discount on terms booked. The offer is valid for stays between 01.11.2011 and 31.10.2012, booked by the 31st of October 2011 with a mini-mum duration of 3 nights and is not cumulative to any other offer. Book Now at www.kani-kahotels.com Enter Club Code for Times Readers: 1414

Clockwise from left: Kourion Theatre near Limassol; the church of Agia Aikaterini in Kritou Terra; Ayia Napa beach; Cyprus is a destination for sports tourism; the Agia Paraskevi Byzantine church in Geroskipou.

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cyprus has always Been more than just a Beach holiday. it’s avaried island with a rich culture and 10,000 year history.

“I ’ll have a glass of xinisteri, she’ll have some spourtico and we’ll follow with a bottle of your finest maratheftiko.”

This isn’t something you hear often in Cyprus restaurants – the names of the island’s best indigenous grape varieties are hard to pronounce, even before you’ve tasted them, and many restaurants are still relatively igno-rant about wine – but if you want to taste the best Cyprus’s fast-improving wine industry has to offer, start practising now.

Not long ago, Cyprus wine meant one of the adequate but rather dull mass-produced offerings of the four big producers: Loel, Etko, Sodap and Keo (whose red Othello and white Aphrodite were probably the best of the bunch), or a glass of the sweet dessert wine Commandaria, whose fame dates back to the Crusades.

However, things have moved on and Cyprus wine-makers have woken up to the potential that lies in their grapes, and in their soil. The big four all now make bou-tique wines, many of them excellent (Keo’s cabernet sauvignon and its Heritage Maratheftiko, made by its Ktima Mallia winery in Li-massol, are good examples).

There are now some 60 wineries in Cyprus, includ-ing tiny producers who make wine from free-run juice out of their own farm or house, though most larger producers of quality wines are based near Paphos and Limassol. Many – notably the Vouni Panayia winery, located just down from Panayia, hometown of the late Archbishop Makarios, first president of the republic, and near the must-see Chrysorrogiatissa Monastery (which also makes wine) – do tastings, with lunch and snacks on offer.

Others operate from more modest sur-roundings: the Fikardos Winery – which produces a range of some 15 wines – is based in an industrial park in Paphos, whilst the An-toniades Winery in Mandria operates out of tiny premises in the lower Troodos. Not one to miss a trick, the Cyprus Tourism Organisa-

tion has just produced a booklet promoting six delineated wine trails, all supported by signs along the way.

So where to start? The Limassol Wine Fes-tival, held early September, has become an an-nual fixture in the tourist calender and is well worth visiting. If time permits, get into a car – preferably with someone else driving – and follow a route. If not, start tasting some wine.

Producers use international grape varieties, many of which do well under the hot Cyprus sun. But to get a proper feel for what makes Cyprus wine distinct, stick with the indigenous varieties: kanella, ophtalmo, promara and mavro, a high-yielding, rather average-quality red grape, are all used. However, quality-conscious producers are increasingly turning to maratheftiko, Cyprus’s red answer to malbec.

Fine examples are made by Fikardos, although its current 2008 vintage is still too young; Zambartas, whose 2009 was among the best I tasted; Ezousa Winery’s Eros, a rose made from 100% maratheftiko; and Vouni Panayia’s Baba Yiannis 2004, grown at 1,000 metres and superbly full bodied.

Xinisteri, a white grape which produces wines akin to a semillon-sauvignon blend, is easier to find, and many wineries make good examples. Again, Fikardos and Vouni Panayia do well, the former with its market-leading Amalthia, blended with 15% semillon, the lat-ter with Alina.

Cyprus wines remain good value, with de-cent bottles retailing at around €10. —JK

Winemakers strive to please any palate

There are some 60 wineries in Cyprus, many are family concerns.

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