Serious governance, environmental, and financial shortcomings in the management of state forest land are laid bare in a new Special Report by the Audit Office of Cyprus, which examines the Forestry Department’s actions between 2018 and 2024. The report depicts weak controls, opaque decision-making, and repeated departures from environmental and legal safeguards — including within protected Natura 2000 areas.

At the centre of the findings are controversial leases of state forest land, some approved without adequate documentation, environmental assessment, or proof of public benefit. In one of the most striking cases, the Audit Office found that land leased in the Troodos area for the creation of an “Adventure Park” doubled in size — from 20,000 to 40,000 square metres — between the initial application and the final agreement, without any supplementary request or justification on record. Crucial documentation, including minutes of interdepartmental consultations, was missing, while no evidence could be found that the legally required criteria — environmental impact, project viability, or availability of alternative land — were properly assessed prior to Cabinet approval.

Environmental safeguards appear particularly fragile within Natura 2000 sites. In the Machairas National Forest Park, forest land was leased to a private association for the development of a youth camping facility within two protected Natura 2000 zones. Despite the confirmed presence of the Cypriot grass snake (Natrix natrix cypriaca) — a priority species referenced in an EU Reasoned Opinion against Cyprus — the environmental assessment issued by the competent authority made no mention of the species. By August 2025, no Special Ecological Assessment had been prepared, despite the project’s location and known biodiversity risks.

The Audit Office also questions the invocation of “public benefit” provisions to justify the lease, noting that the association was established solely to secure the land and has no formal affiliation with the Cyprus Scouts organisation.

A similar pattern of procedural shortcuts was identified in the Polemidia National Forest Park, where construction works for special education schools commenced before a lawful lease of the forest land had been concluded. The Forestry Department’s repeated objections, based on the park’s high environmental value, were not adequately reflected in the environmental authority’s final decision. The Audit Office concludes that, despite the project’s acknowledged social value, the process resulted in “insufficient protection” of the forest park due to unlawful actions and omissions.

Beyond environmental concerns, the report highlights significant financial risks for the state. Long-term leases of forest land to hotel units in Ayia Napa — some dating back to the 1970s — have not been properly updated, resulting in years of undercharged rent during a period marked by tourism growth and high inflation. The Audit Office warns that outdated contractual clauses and prolonged delays in recalculating market rents expose the Republic to revenue losses and legal disputes. As of the end of 2024, overdue revenues owed to the Forestry Department amounted to €1.3 million, largely stemming from long-term leases. In one Troodos hotel case alone, €917,395 was claimed for the period 2007–2024, but the state lost the court case after failing to substantiate the legality of the rent revisions.

The report further documents widespread breaches of lease terms by nautical clubs, unlawful interventions in coastal forest zones by hotel units, unresolved cases of illegal occupation of state forest land, and a chronic failure to reconcile forest land records with those of the Land Registry — a process that remains incomplete more than a decade after it was first agreed.

In its conclusions, the Audit Office calls for urgent reinforcement of transparency, environmental compliance, and financial oversight, warning that current practices undermine both the protection of Cyprus’s forests and the credibility of public administration. Without systemic reform, the report cautions, state forest land will remain exposed to ad hoc decisions, legal uncertainty, and irreversible environmental damage.