The City of Dreams Mediterranean casino-resort in Limassol has failed to meet revenue expectations, documents to be discussed at the House on Monday show.

The findings are contained in the risk analysis and management report accompanying the 2026 budget of the gaming authority.

The report states that Melco’s turnover is lower than projected, while the company’s weakened share performance on the New York stock exchange compounds strategic uncertainty.

Melco has held the exclusive licence to operate a casino resort and satellite casinos since 2017, following an investment exceeding €600 million.

The report links the underperformance to global economic slowdown, regional instability in the Middle East and Levant, and increased volatility in financial markets.

According to the analysis, it cautions that any revision of Melco’s commitment, or a potential withdrawal, would generate economic, social and institutional risks for the casino operating model in Cyprus.

Casino resorts in Greece and the United Arab Emirates are expected to attract regional and international visitors, while illegal online gambling providers and casinos operating in the north continue to undermine the local market.

The next three-year period is described in report as one of intense strain, requiring the authority to balance heightened expectations, technological investment and escalating risks.

“Strategic advantage will be judged by the ability to rapidly integrate information, adapt institutionally and strengthen the social and regulatory role with transparency and accountability,” the report says.

The authority’s 2026 budget is balanced, with revenues and expenditure of approximately €3.68 million.

Funding is derived mainly from state sponsorship alongside smaller income streams, including €50,000 from a European lifelong learning programme.

Operating costs are projected to rise by just over eight per cent, largely due to increased personnel expenses.