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The Paphos-Polis Chrysochous road project has become a financial and legal mess, with millions already spent but little to show for it. Delays, contract disputes, and a legal loophole are holding up the project’s completion, raising serious concerns about how public contracts are managed in Cyprus.
A Road Project Stuck in Limbo
From the start, things went wrong. By the halfway point of the project’s timeline, only 4% of the work had been finished, according to the Audit Office. As the deadline grew closer, government officials began questioning whether the project could even be completed on time.
In December 2023, the Audit Office sent a warning to the Public Works Department about the slow pace of the work, asking if it was realistic to expect the project to be done by the new deadline set for September 2023. This deadline was set by the contractor without approval from the state.
Contractor's Money Troubles
The contractor’s financial problems are another big reason for the delays. The General Accounting Office (GAO) pointed out that the contractor seemed unable to fund the project, which could justify canceling the contract. According to procurement laws, a contract can be terminated if the contractor can’t meet financial obligations or finish the work. However, the contractor insisted that delays were the government’s fault for not meeting its obligations.
In a letter to the Public Works Department in November 2023, the contractor blamed third-party issues for the hold-ups. But by February 2024, the Public Works Department firmly rejected these claims, highlighting several steps it had taken to help the contractor move the project along.
By January 2024, only 18% of the work was done, even though €16 million had already been paid, including adjustments for price changes.
Legal Loopholes Protect the Contractor
In November 2024, after repeated delays, the Public Works Department officially canceled the contract. But when officials tried to seize the contractor’s financial guarantees—a common practice to recover public funds—legal problems got in the way.
The Audit Office revealed that the government had made a critical mistake: it sent letters to seize the guarantees a day after canceling the contract, instead of on the same day. This delay gave the contractor a chance to get a court order blocking the seizure of the guarantees, preventing the government from recovering its money.
To make matters worse, even though the contract clearly stated that Cyprus’ legal system should handle disputes over the guarantees, a Greek court ruled in favor of the contractor. The Audit Office warned that this decision could set a dangerous precedent, letting contractors avoid financial responsibility by exploiting foreign legal systems.
Who Pays for the Mistakes?
With the project stalled and no end in sight, taxpayers are left covering the cost for a road that still isn’t finished. This situation also highlights serious flaws in how Cyprus handles public contracts, raising questions about oversight and legal protections.
The damage is done: millions of euros have been spent, deadlines missed, and the road to Polis Chrysochous remains incomplete. This project serves as a costly reminder of bureaucratic failures and the risks of legal loopholes in public contracts.
