Cyprus is a country with many things in common with Greece. So many in fact, that one often tends to forget that it is an entirely different country. Primarily, though, Cyprus is an important exporting destination for many Greek products, and especially those of the f&b sector. Mr. Ioannis K. Katsaras, First Counsellor for Economic & Commercial Affairs, Head of Economic & Commercial Affairs Office at the Greek Embassy in Nicosia, explains to Ambrosia magazine how can side developments, such as the Cyprus-Greece coastal shipping link can play a significant role in the bilateral trade, and gives an insight as to how can Greek companies expand their exporting portfolio even more, in an market that already welcomes warmly Greek f&b products.

Interview: Charitomeni Vonta

Please tell us a few things on the trade relations between the two countries, Cyprus and Greece.
Greece-Cyprus trade relations remained at a high level throughout the previous three years, which were marked by the effects of the COVID 19 pandemic and the Russian invasion of Ukraine, and this is a particularly impressive fact. The statistics of bilateral trade between Cyprus and Greece in 2022 confirm the opinion that the economic relations between the two countries are not temporary, but rather stem from common interests and deep-rooted business connections.  More specifically, the commercial transactions of Cyprus with Greece in the twelve months of 2022 (January – December 2022) were at the highest level in a decade for both markets. Greece in 2022 was the second export destination of Cypriot products (second to the United Kingdom). At the same time, the Cypriot market shows a strong preference for Greek products, resulting in Greece being in the first place in Cyprus’ imports.
The country’s exports to Greece showed an increase of 13.9% in the twelve months of 2022, reaching €121 million (€106.3 million in 2021). Exports (domestic and re-exports) of Cypriot products to Greece for the 12 months of 2022 increased by 14.1%, reaching €297 million (€260 million in 2021), once again making Greece the main European sending country of products for 2022. Also, the imports of Greek products in Cyprus for the same period (Jan.-Dec. 2022) soared to €2.64 billion, i.e. an increase of 27.2% compared to the corresponding period of the previous year (Jan. – Dec. 2021: €2.08 billion). In the first months of 2023, there does not seem to be any abatement of this trend.

What are the biggest advantages of Greek f&b products in your market?
From the mapping of Greek exports it is obvious that Greece has an export advantage based on products of the primary production sector, therefore, in principle, this is the sector where Greek exporters should focus their efforts on. Cyprus, being an EU country (freedom of trade, duty-free products, common phytosanitary and sanitary requirements) with a high living standard, is inhabited by Greek-Cypriots, in its overwhelming majority in the areas controlled by the Cypriot Government, but it also has communities of legally settled foreigners who amount to a total of approximately 14%-15% of the legal population (retirees from the United Kingdom, Russians, Lebanese, Israelis and recently also Ukrainians), who reside in Cyprus.
This element, along with the traditional Greek cuisine and culture, which is similar to the Cypriot one, rooting back to antiquity, combined with the strong tourist market, enriches the f&b market with different foods and drinks, giving space to many Greek products. Therefore, the greatest advantage of Greek f&b products is, on the one hand, the common national origin of the population which, despite its insular character, has, for the most part, the same or similar consumption habits as those of the Greek population (islands and mainland alike), thus requiring less promotional actions. On the other hand, they are also favored by the strong tourist market, given that the national branding of Greek f&b products is equally well received by the Cypriot tourist market.
In addition, Cyprus procures the largest volume of the food it needs from foreign markets. This means that its trade balance in this particular sector is in deficit, with Greece remaining the largest supplier of food to Cyprus over time. Most of the imported food in Cyprus belongs to the processed food & beverages category, which mainly includes meat and fish preparations, confectionery, cereal preparations, beverages & vinegar, cocoa, plant products (mainly fruits, vegetables, coffee, tea & spices, cereals, flour, oilseeds and related products), animal products (meat, fish, dairy, honey, eggs) and fats & oils, by percentage (animal and vegetable fats).

F&B imports from Greece in 2022

Also, there are important Greek (or established in Greece) chains, with common distribution networks, in which approximately 80% of food purchases are made, such as supermarket chains with a network of points of sale in Cyprus: SKLAVENITIS, MAS, METRO, LIDL, SPAR, ELOMAS, SMART DISCOUNT STORES, SUPER DISCOUNT STORE, COOP CITY STORES, GALAXIAS.
Particular emphasis should also be placed on food and beverage e-commerce, which in 2023 (food and personal care products) is projected to reach USD 264.8 million by 2023, making for 27.5% of the total e-commerce market in Cyprus and is expected to increase in the coming years.
Finally, the new environmental perception that favors imports from neighboring markets and discourages imports from distant markets for environmental reasons also has a positive effect.

What is the importance of the Cyprus-Greece coastal shipping link for the expansion of trade relations between the two countries?
Bilateral trade is significantly helped by the Cypriot-Greece coastal shipping link, which returned in the summer of 2022, after a twenty-year hiatus. The launch of a passenger ferry ship on the Cyprus-Greece coastal line is a long-term strategic transport project, with a positive impact on economic-commercial relations. This is, essentially, a development with multiplier benefits such as the increase in bilateral travel traffic, the attraction of an alternative passenger and consumer audience, the strengthening of tourism, transit trade and the further stimulation of bilateral economic-commercial relations.
The data collected so far (number of passengers 2022 and pre-bookings 2023) show that the market supports this initiative. A total of 7.900 passengers traveled in 2022, exceeding the original 5,000 passengers estimate, and over 1.500 cars and 150 motorcycles were transported (shipping routes in 2022). This year there will be a total of 22 routes to Piraeus, (14 from Limassol and 8 from Larnaca), with the prospect of expanding the connections, subject to market conditions, covering all ports of Cyprus and a longer period of time.

What initiatives would you consider useful for the expansion of Cyprus-Greece economic and business cooperation?
At first, we have to say that until 2011 the economic and business cooperation was largely exclusively of bilateral nature. This has changed. The deepening of relations with neighboring countries such as Egypt or Israel brings benefits and creates opportunities for wider collaborations at the economic and business level as well.
On a bilateral level, there are very significant prospects for further penetration of Greek products to the Cypriot goods market, such as in food/beverages, due to strong demand and the entry of new products, in tourism, due to the improvement of tourist flows to Greece and Cyprus, and in the cosmetics sector, due to the climate conditions. We could propose a series of actions that take advantage of the new possibilities of commercial transactions:
– the expansion of the Hosted Buyers programs for businesses in Greece and Cyprus.
– the creation of joint electronic platforms for Greek and Cypriot products, taking advantage of the ever expanding online commerce, especially after the end of the pandemic. Even more so, since many agencies and businesses believe that the trend of online shopping growth is irreversible.
– the more systematic participation of individual Greek and Cypriot companies or national participations in exhibitions of the f&b and tourism sector held in Cyprus and Greece.
– the unified touristic and culinary promotion of Greek regions or municipalities in large tourist agencies.
Given the particularly close relations between the two countries, the geographical proximity, the common language and the similar business ethics and consumer preferences, Greek products are extremely popular, resulting in imports from Greece corresponding over time to approximately ¼ of all Cypriot imports, covering a wide range of needs. Greece holds first place both as a country of origin of Cypriot imports and as a destination of Cypriot exports.

Would you say that there is a margin for further penetration of Greek products in the Cypriot market?
Despite the already strong presence of Greek food in Cypriot supermarkets, there is still a demand for specific products: ready pre-cooked meals, frozen products (eg dough, fish) and traditional Greek dishes. In addition, there is a particular interest in Greek wine from importers/distributors of spirits, liquor stores and supermarkets. We should also note the high level of recognition of Greek cuisine and Greek wine producers by the average Cypriot consumer, who, for the most part, has repeatedly visited Greece for leisure and/or business.
Also, due to the relatively developed domestic production of food (mainly, dairy, bakery products and ice cream) and beverages (wines and local spirits), there is a demand for related machinery.


Can you please give us an outline of the current f&b imports from Greece, and the climate that forms the relevant conditions?
Within the above-described context of steady rise in bilateral trade between Greece and Cyprus, the percentage of f&b products imports vary between 12.5% -19.5% of the total imports of Cyprus from Greece, showing both the potential and the export durability of Greek agri-food products. Research has also shown that, in recent years, the purchasing habits of consumers internationally are changing and the search for more value in shopping is becoming a primary goal. Therefore, there is a tendency for the consumer to switch to cheaper products or products on sale. This fact favors Greek agri-food products, which are by default more competitive than corresponding European products available in Cypriot supermarkets.
As our Office points out in the 2022 Business Guide, there is significant demand for new products into the f&b sector, while it should be taken into account that Cyprus has a higher per capita income than Greece and consequently the average Cypriot consumer has higher purchasing power, under the condition that there is a good quality/price ratio, a condition which is considered a fact for the majority of Greek products. The possibilities of exporting organic products, vegan products and others should also be considered, as well as the intensification of business contacts, which should not be left to “autopilot”, due to the general positive climate and the positive image that Greek products have in the eyes of Cypriot consumers. It should also be taken into account that the average Cypriot household spends 14.1% of its expenditure on food and non-alcoholic beverages, i.e. approximately 9.2% of GDP, according to Eurostat data for 2021. In these numbers one can also add alcoholic beverages -in 2021 the specific share was 1.9% of total household expenses and 1.2% of GDP.
Last but not least, export companies should take advantage of the network of Greek chains of superstores and hypermarkets operating in the Cypriot market. To name but a few, Sklavenitis, Greek coffee chains and fast-food restaurants, such as the Mikel coffee shop, the Derlicious and Coffee Island restaurants, Yfantis Deli (founded Ifantis Cyprus in 2012), etc.