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Tickets for Cyprus united?

Europe's last divided territory could soon be re-united - with a "peace dividend" for British travellers. For the past 30 years the island of Cyprus has been split between the predominantly Greek Cypriot republic in the south and the self-styled Turkish Republic of Northern Cyprus. But last week the United Nations secretary general, Kofi Annan, said that an agreement between the two sides could lead to the re-unification of the island by 1 May, when Cyprus is due to join the European Union.

"There's no doubt in everybody's mind that they're going to accept," says Noel Josephides of Sunvil Holidays, who travelled to the island this week. "Even hardliners are saying that if we don't take this opportunity, we're finished."

Josephides's company started up in 1970 as a tour operator to Kyrenia, the main port on the north coast. Since the Turkish invasion of 1974, Sunvil has focused its operations in the south, the destination for the vast majority of the one million British tourists to Cyprus each year. Tourism to the north is minimal; the regime is regarded as illegal by most of the world community, and direct flights from the UK are banned.

A settlement could transform tourism to Cyprus. Many of the island's attractions, from fishing villages to crusader castles and Greek ruins, are in the north, and the former resort of Famagusta has been off limits for 30 years. "There will be an overall increase in visitors, and a big demand for two-centre holidays," Josephides predicts. "It will be a more rounded product."

The timing of the proposed settlement could not be better, as it coincides with the start of the main tourist season in May. With millions of British travellers still undecided about where to take their holidays, Cyprus could have its best-ever year. But Belinda Brocklehurst of Cricketer Holidays, a northern Cyprus specialist, sounds a note of caution. "They're not ready in the north to have planeloads of people arriving. The infrastructure isn't up to scratch yet, and they need to get their roads sorted out."

If this turns out to be the first summer for three decades in which holidaymakers can visit the united island, there is likely to be a sharp rise in flights to Ercan airport in the north - and a battle over the location of the island's principle location. Some Cypriots want to see Nicosia airport, formerly the hub for the Eastern Mediterranean, re-opened. Others believe that Ercan should simply be renamed as Nicosia. But Larnaca on the south coast is unwilling to surrender its role as the island's air hub.

Simon Calder

Cricketer Holidays: 01892 664 242 Sunvil Cyprus: 020-8568 4499

Malta faces tourism slump

Malta has been dropped from the itineraries of many Mediterranean cruises this year because the island is joining the EU. On 1 May it loses its duty-free status. Under European law, cut-price concessions are permitted only on ships putting in to ports outside the EU at least once on their voyage.

This will hit British cruise passengers who enjoy the twin benefits that Malta has - a 200-year connection with the UK, and islanders who speak English. But it is worse news for Malta, which welcomed 200,000 day trippers on about 180 ship visits last year, and where tourism is by far the biggest industry. This year it is expecting only "a few thousand" cruise passengers. The biggest local tour operator estimates that his 2004 trade will be down by 95 per cent. In addition to the cash spent in shops and bars, the historic Grand Harbour will suffer severe losses in port fees, wholesale supplies and the sale of fuel.

One liner, SS Oceanic, called in on a weekly basis last year with up to 1,400 passengers, and took on £80,000 worth of fuel each time. This year it has removed Malta from its itinerary. Most ships will be substituting Tunis as a port of call.

Last year the number of British tourists to Malta increased by 3.4 per cent to 460,000, the highest number ever. But arrivals from Germany, Italy and France were all down, resulting in a net drop in tourists for the third year in a row.

Revel Barker