Mega casino is coming: Cyprus wants to become the Las Vegas of Europe

Nikosia.
Cyprus mastered the financial crisis surprisingly quickly. Now the conservative government wants to ensure sustainable growth with Europe’s largest casino. In the spring of 2013, the Greek south of Cyprus plunged into the worst crisis since the island was divided in 1974. The banking system was on the verge of collapse. For the first time in a euro country, the depositors had to bleed: 47.5 percent of balances of more than 100,000 euros were converted into almost worthless shares.

Four years later, the crisis seems almost forgotten. The banks have been stabilized and capital controls lifted. Tourist numbers rose 17 percent in the first six months. In the first quarter of 2017, the Cypriot economy grew by 3.3 percent, employment even increased by 3.4 percent compared to the previous year. Treasury Secretary Harris Georgiades expects an increase of around three percent for this year. “The most important thing is that this growth is more sustainable than ever before,” emphasized the minister.



Casino is said to offer over 136 gaming tables and 1200 slot machines

Some already speak of a “miracle of Cyprus”. It manifests itself mainly in the port city of Limassol. Yachts worth millions lie in the newly built marina. Life pulsates in the cafes and restaurants. The residential tower “One”, which is currently under construction, will tower 36 floors, the tallest building on the island. The 84 luxury apartments are being offered at square meter prices of around 15,000 euros.

Limassol will soon have a new attraction to offer: at the end of June, a Chinese-American consortium received the concession to build and operate the largest integrated casino resort in Europe. The investment will amount to around 500 million euros.

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The casino is said to have 136 gaming tables and 1200 slot machines. The complex also includes a five-star hotel with 500 rooms, a conference and concert hall for 1500 people, a 4000 square meter wellness oasis and a shopping center with luxury boutiques. An outdoor area with a pool area, water features and palm trees should provide a touch of Las Vegas in the eastern Mediterranean.

The casino construction is a milestone for Cyprus

“It is the most important project that Cyprus has seen in the past decades,” says Minister of Commerce and Tourism Yiorgos Lakkotrypis. He expects the casino resort to generate 300,000 to 500,000 additional foreign tourists per year and better utilization of hotel capacities in the winter months. For comparison: Last year 3.2 million vacationers came to the island.

In addition to tourism, which contributes around a fifth of the gross domestic product (GDP) of Cyprus, financial services are an important pillar of the Cypriot economy. Before the crisis, Cyprus was seen as a tax haven and black money laundromat. The government has renounced such dodgy deals. That was the condition for the rescue package put together in 2013 that saved the island from ruin.

Money laundering should continue to be combated

Even after completing the reform requirements and successfully completing the adjustment program, Cyprus will remain under the supervision of the euro partners. The concern that Cyprus will fall back into old, bad habits with the casino project is therefore unfounded, according to government circles. The rules for combating money laundering are strictly adhered to in the casino too.

The state can pay for the concession in the first four years with 2.5 million euros, then with five million per year. It runs for 30 years, the operators have a monopoly for the first 15 years. The gross gaming revenue is taxed at 15 percent, which is very little. Rates of 35 to 80 percent are common in European countries. Finance Minister Georgiades expects additional tax income of around 100 million euros per year. According to a study by the auditing company Deloitte, income from tourism could increase by 450 million euros a year thanks to gambling.

$ 700 million in gaming revenue per year

A look at the north of the island, which has been occupied by Turkey since 1974, shows that gambling in Cyprus can be a profitable business. There are around two dozen casinos in the internationally outlawed “Turkish Republic of Northern Cyprus”. The industry is estimated to have at least $ 700 million a year in sales. Even the Chinese, who are considered to be the world’s best casino customers, as well as players from the Gulf States and Lebanon are frequent guests in Northern Cyprus.

Many Greek Cypriots are also drawn to the casinos across the demarcation line in the evening. In the future they can indulge their passion in the south as well. In addition to the complex in Limassol, the operator has concessions to operate “satellite” casinos in the capital Nicosia and the coastal towns of Larnaca and Paphos. The hotel, conference center and casino in Limassol are expected to be ready in early 2020, but gaming operations in Nicosia are set to begin before the end of this year.

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