The City of Dreams Mediterranean in Cyprus is facing a reduction in its workforce, with 181 workers being laid off. This comes just three months after the opening of the €550 million integrated resort in Limassol. Melco Resorts, the Hong Kong-based gaming operator that owns City of Dreams Mediterranean, has blamed the layoffs on the Hamas-Israel war, which has caused a business slowdown.
The resort, which features 500 luxury guestrooms, as well as amenities such as pools, a spa, a water park, and convention space, opened to much fanfare on July 10. However, the conflict between Hamas and Israel, located less than 250 air miles from Cyprus, has had a significant impact on the resort’s business operations.
According to Melco Resorts, the layoffs include 130 full-time employees and 51 part-time or contractor workers. The company reported an operating loss of nearly $7.8 million in its third-quarter earnings report, largely due to opening costs and a gaming license payment.
Tourism is vital to the Cyprus economy, with the service sector contributing almost 80% of the country’s GDP and employing more than seven in 10 workers. The resort initially opened with approximately 2,000 employees, but the recent layoffs have reduced that number.
Melco Resorts’ founder, chairman, and CEO Lawrence Ho acknowledged the impact of the conflict on City of Dreams Mediterranean during the company’s earnings call, stating that the firm is working on realigning its marketing strategy in the region.
Meanwhile, reports indicate that Hamas and Israel are nearing an agreement to pause fighting. Hamas is said to be considering turning over hostages it has captured in exchange for a temporary ceasefire. However, the conflict continues to have far-reaching effects, with the World Health Organization condemning the Israeli attack on an Indonesian hospital in northern Gaza.
Overall, the City of Dreams Mediterranean’s decision to reduce its workforce highlights the widespread impact of the ongoing conflict and the challenges it poses for businesses in the region.