Industrialists operating in the Geri-Idalio-Tseri industrial zone are furious over a government decision to declare the area a “White Zone” for two years, warning the move is a stepping stone to permanent restrictions that will strangle their businesses.
The freeze, enacted through two decrees by Interior Minister Constantinos Ioannou on 20 March and 26 June 2026, blocks all new Category A (heavy industrial) development. The decision has sparked a fierce row between local authorities, the business community, and conflicting government ministries.
While the Nicosia District Self-Governance Organisation (EOA), local councils, and residents support the freeze to protect public health and the environment, the Employers and Industrialists Federation (OEB) and factory owners are sounding the alarm. They see the decision as a prelude to permanently downgrading Nicosia’s only heavy industrial zone.
The conflict stems from poor town planning. When the state set up the Geri-Idalio zone in the early 1980s, the land was barren and far from residential areas. Over the years, urban sprawl brought housing estates right up to the factory walls, sparking complaints from the Latsia-Geri and South Nicosia-Idalio municipalities over pollution and noise.
Before the government stepped in, OEB and the zone’s management committee fought hard to stop the downgrade. In a letter to former Commerce Minister George Papanastasiou on 8 May 2025, OEB Director General Michalis Antoniou warned that roughly 50 businesses had invested massive sums to build factories and create hundreds of jobs on private land, and that a downgrade would suffocate the sector.
The zone’s management committee also wrote to Nicosia EOA President Constantinos Yiorkadjis on 13 June 2025, dismissing claims of unchecked pollution. The committee noted that regular inspections by the Department of Environment and the Department of Labour Inspection found no violations. They added that strict fire safety measures introduced in 2023 had completely wiped out fires at licensed recycling plants.
The Ministry of Energy, Commerce and Industry strongly backed the businesses. In a letter to the Town Planning Department on 16 June 2025, ministry officials explicitly opposed the municipalities’ demands. The ministry warned that a downgrade would trigger a chain reaction damaging current operations and future investments. It cited a 2022 national study showing that Cyprus actually needs more heavy industrial zones, not fewer, making the loss of existing sites highly damaging.
Despite the warnings, the cabinet approved the White Zone decree on 11 March 2026, freezing new heavy industry until 19 March 2028. Existing licensed plants can only make building upgrades or change technical equipment if they do not increase their production capacity.
The Nicosia EOA welcomed the decision on 3 April 2026, stating it pushed for the measure to protect residents. Crucially, the EOA noted the freeze lays the groundwork to redesign the industrial zones in upcoming Local Plan reviews—confirming the business community’s worst fears.
Michalis Gregoriou, head of business development at OEB, slammed the freeze as a purely political move driven by municipal pressure rather than scientific evidence. He warned it penalises law-abiding businesses, freezes critical investments, and leaves people who bought land unable to develop it. In a letter to Energy Minister Michalis Damianos on 19 May 2026, OEB warned that if the downgrade becomes permanent, Nicosia will lose its only heavy industrial zone, shattering investor confidence. OEB demanded an immediate meeting to find a way for residents and industry to coexist, arguing that the state should punish individual rule-breakers rather than penalising the entire sector.
Erik Shukuroglou, chairman of the zone’s management committee and managing director of Premier Shukuroglou Cyprus Ltd, said the White Zone is simply a tool to force businesses out. Factory owners have already launched legal appeals against the cabinet’s decree, arguing that the capacity freeze threatens their survival.
Shukuroglou pointed out the hypocrisy of blocking expansions in circular economy sectors, noting that his own licensed green waste and composting business cannot operate anywhere else. He concluded by highlighting that Cyprus already pays heavy fines for poor waste management and faces desertification, yet the state is blocking the production of compost that local soils desperately need and which the government itself subsidises.