A dispute between the Department of Forests and contractor Cyfield over improvements to the Akamas National Forest Park’s main road network has resulted in a €1.2 million loss for the Republic of Cyprus.
The loss stems from two guarantee bonds that were regularly renewed until December 15, 2024: a €900,000 performance guarantee and a €300,000 advance payment bond.
Sources say the Forestry Department made a legal error by requesting guarantee renewals from the contractor without simultaneously approaching the bank to liquidate the bonds in case of non-renewal.
According to Cyfield owner Kyriakos Chrysochos, the company terminated the contract on December 23, 2024, following the department’s written request dated June 6, 2024.
Cyfield remains unpaid for completed works since the project’s suspension in December 2023.
The dispute intensified after the Agriculture Minister’s January 8, 2025, statement to the parliamentary Environment Committee, blaming the contractor for the contract’s termination.
Chrysochos reveals that following a disrupted meeting in June 2024, there was no further communication between the parties.
Cyfield cites two main reasons for terminating the contract: the work suspension exceeded the agreed 84-day period, and the department failed to pay €500,000 in certified amounts within the stipulated 56-day timeframe.
The company also notes it received no updates regarding final construction plans based on the Environmental Assessment Report published by the Environment Department in March 2024.
On January 9 and 10, 2025, both Cyfield and the Department of Forests issued statements addressing the situation, following the public announcement of the contract’s termination.
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