NICOSIA – Reluctantly going along with European Union sanctions over the invasion of Ukraine that include barring Russian airlines – and tourists – will see Cyprus take a hit of as much as 476 million euros ($523.04 million.)

That was the projection from the rating agency DBRS Morningstar which said the loss of the tourists could be as much as 2 percent of the annual Gross Domestic Product (GDP) of 21.66 billion euros ($23.8 billion) said SchengenvisaInfo.com

That was if the sanctions last through 2022, with the country still dealing with the beginning of a third year of the COVID-19 pandemic that could see tourism, its biggest revenue engine, held down again since 2019 when it brought in 13.8 percent of GDP.

“The impact will be much smaller if the restrictions are lifted before the summer season or if Russian tourists find alternative routes to Cyprus,” the agency explained.

Cypriot tourism is facing another 20-25 percent loss in tourist arrivals as the Russian market makes up for the second largest in Cyprus although the government of President Nicos Anastasiades said it might break with the EU if the price becomes too high and tourists head for Turkey instead.

There could be a way to recoup some of the losses if tourists from other countries could be lured but the invasion is causing fuel costs to spike, including for airlines and that could deter international travel again.

“It is clear that the tourism industry may face short-term pressures due to the setback in Russia; however, the comparative advantage of Cyprus, in terms of its attractiveness of tourists, will remain positive this year,” the report read.

But the agency said that as COVID wants and the EU pumps in aid in the form of loans and grants to member states that a disaster for the economy could be averted and a slight bulwark built.

DBRS also points out that “the European Commission’s forecast for a growth rate of 4.1 per cent in 2022 now looks optimistic.” The World Travel & Tourism Council (WTTC) previously revealed that the tourism sector accounted for 13.8 pe cent of Cypriot GDP in 2019.

Exports of financial services from Cyprus to Russia have surged in recent years, summing up to about 7 percent of Cypriot GDP in 2020, the site said, the island having a big Russian population and business interests, and reputation as being a haven for rich Russians to hide their money.