The Paphos-Polis Chrysochous highway project faces renewed delays with construction now postponed beyond 2030 following a contractor appeal that has halted the tender process for a revised construction study.
The Tenders Review Authority suspended the Public Works Department’s plan to award a new study contract after the Greek AKTOR Group of Companies challenged the 6 August 2025 Council of Ministers decision to restart the project implementation.
Initial cost estimates for the 31-kilometre motorway were calculated at €85 million twenty years ago, but total project costs later escalated to €867 million when financing, interest rates and additional requirements were included.
Contractor appeal halts tender process for revised construction study
The government terminated AKTOR’s construction contract for Phase A of the project on 11 November 2024, citing the contractor’s failure to meet contractual obligations.
AKTOR’s appeal contested technical, economic and financial specifications in the new tender. The company argued that “the significance of taking provisional measures lies in ensuring control of the legality of the challenged decision and avoiding waste of public money.”
AKTOR contended that “the tender procedure is at its initial stage and given the short time period required for the appeal hearing, there will be no delay in the tender procedure and the public interest will not be endangered.”
The company warned that “if the tender procedure proceeds with the illegal terms already identified, there is serious possibility the project will be awarded to contractors under terms that will subsequently be deemed illegal or voidable.”
Project costs escalated from €85 million to €867 million estimate
AKTOR said that “without handover-takeover of existing work, a new assignment procedure cannot proceed due to vagueness of the subject of the announced contract.” The contractor also highlighted the need for “the Contracting Authority to secure environmental approval from the Environmental Authority before commencing any work.”
The Review Authority requested submission of “Report of Events,” “Written Plea by Applicants” and “Written Plea by the Contracting Authority” by 3 October 2025.
Land expropriation costs initially estimated at €85 million eventually reached €101 million, with interest rates at 9 percent during the original planning phase. Construction costs were initially calculated at €274 million.
By 2008, when construction costs, expropriations, material price increases, labour costs, interest and additional banking requirements were included, total project costs reached €867 million.
Construction timeline pushed beyond 2030
The annual payment requirement increased from an estimated €30.6 million to €32 million, with the successful bidder ultimately demanding €34 million annually for 25.5 years.
Former Auditor General Chrystalla Georghadji previously deemed the road construction economically unfeasible due to limited vehicle traffic. Traffic studies indicated 6,800-10,700 daily vehicles on the existing route, below the 13,000 vehicles per day capacity for two-lane roads.
The former Auditor General noted the proposed road would feature two lanes with motorway geometric characteristics, which posed safety risks due to expected high speeds.
Current Phase A covers approximately 15.5 kilometres from Agia Marinouda to Stroumbi, with two traffic lanes and provision for future expansion to four lanes. The remaining 15-kilometre section from Stroumbi to Polis Chrysochous entrance awaits future development.
Phase A includes one grade-separated junction, one at-grade junction for future development, and a terminal roundabout, incorporating all preliminary study constructions including valley bridges, tunnels and drainage systems.
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