Cyprus tourism still suffering from drone incident but EU countries softened warning

Cyprus’ tourism sector, which directly and indirectly supports around 14% of national GDP, is still feeling the aftershocks of the Iranian drone that fell near the British RAF base at Akrotiri on April 5, 2026, raising fresh security concerns just ahead of the summer booking season.

Speaking at the annual assembly of the Federation of Employers and Industrialists (OEB) on April 28, president George Pantelides warned the island “remains in a difficult and uncertain situation,” as tourism demand from key European source markets continues to fall short of expectations.

Despite a strong start to the year, the momentum has slowed sharply. Official figures from Cyprus’ Statistical Service show tourist arrivals reached 121,625 in January and 146,516 in February, bringing the January-February total to 268,141 visitors, up 9.1% year-on-year. However, March arrivals fell sharply by 30.7% to 139,198, reducing total tourist arrivals for the first quarter of 2026 to 407,339, down 8.8% compared to the same period in 2025.

Official figures from airport operator Hermes also show combined passenger traffic at Larnaca and Paphos airports dropped 15.3% in March compared to the same month last year. Some hotels also reported Easter occupancy levels as low as 25% to 45% in certain regions, highlighting the early-season slowdown.

The impact of the drone incident is keeping Cyprus tourism on high alert ahead of the crucial summer season. Airlines including Jet2 have already reduced summer capacity, while forward bookings for May through August are running 30% to 40% behind 2025 levels in key resort destinations such as Ayia Napa and Protaras.

Early-season cancellations have been partly driven by foreign travel advisories. In response to the slowdown, the government introduced a targeted wage subsidy program on April 28, covering up to 30% of monthly salaries, capped at €1,324 ($1,420), for hotels able to prove either a 40% drop in revenue or occupancy below 60% compared to April 2025.

Applications remain open until May 8, giving employers only a short window to stabilize staffing levels before peak summer demand. Tourism industry leaders say the measure is essential to avoid layoffs and maintain service standards until bookings recover.

EU softened its travel warning

For corporate travel managers, the situation presents both opportunity and risk. Airfares on many intra-European routes to Cyprus have dropped, creating short-term savings opportunities, but reduced airline frequencies are limiting schedule flexibility for last-minute business trips.

Cyprus diplomats however secured a significant victory. On April 29, 2026, Bulgaria, France, Denmark, Italy, Croatia, the Netherlands, Hungary, Poland, and Sweden have all updated their official travel advisories, softening their warning and removing references that had linked Cyprus to the wider conflict zones of the Middle East.

These countries have removed recommendation to avoid non-essential travel near British bases and potential disruptions at local airports. Some maintain only geographically specific restrictions.

However, the UK continues to warn travelers that “terrorist attacks in Cyprus cannot be ruled out,” despite the fact that the Cyprus Ministry of Foreign Affaires stresses, the island’s security situation is far more stable than suggested by some travel websites.

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