2020 Cyprus Country Report

operations, the island is sharpening its competitive
edge by streamlining processes, modernising
legislation, introducing incentives and
speeding up licensing procedures to better cater
to investors. Special schemes and incentives are
in place to facilitate headquartering, which covers
the sectors of technology, asset management, investment
funds, shipping and higher education,
‘Olivewood’ for the international film industry,
the Startup Visa for non-EU nationals and a
Fast Track Business Activation Mechanism for
non-EU nationals approved in September 2020.
PRIVATISATIONS AND LARGE-
SCALE PROJECTS
Cyprus’ FDI appeal has been on an upward trajectory
with the economy posting a healthy 3.2%
growth in 2019 and following improvements in
its macroeconomic and financial environment,
factors that have also revived international interest
in around 30 major development projects on
the island. Investment opportunities in Cyprus’
large-scale projects span various sectors, including
high-value tourism and housing developments,
projects with a special focus on golf
courses and luxury marinas, as well as education,
energy and, more lately, the international film
sector.
The liberalisation of markets in which stateowned
entities used to dominate presents new
opportunities in terms of FDI. The 2017 commercialisation
of the country’s largest port in
Limassol marked a new era for Cyprus as a commercial
hub. The privatisation deal with Eurogate
International GmbH and DP World Limited is
expected to boost state coffers with €2 billion
over the next 25 years, while the new port operators
are injecting millions in upgrading services
and infrastructure. The coming full liberalisation
of electricity is also presenting new opportunities
in the natural gas and renewables sectors.
PERFECTING THE TOURISM PRODUCT
Tourism has long been a driving force of the
Cypriot economy and a concerted effort to diversify
its offering in recent years has paid off.
Ahead of the global pandemic, expansion of capacity
as well as quality upgrades saw both arrivals
and expenditure break new records for four
years running. Cyprus has been attracting new
interest by developing conference, sports, health
and wellness and by extending the tourist season.
The construction and investment in multipurpose
projects and mixed-use developments such as
luxury marinas, golf courses and more recently
the island’s first-ever and only integrated luxury
casino resort, are all part of the ongoing strategy to
upgrade Cyprus’ tourism product. The temporary
casino has started operations and the full integrated
casino resort, City of Dreams Mediterranean,
will have extensive facilities and five-star status
by 2021. The casino resort is Hong Kong-based
Melco’s first expansion outside of Asia and will be
the biggest casino of its kind in Europe, with the
investment for this mega project at €600 million.
Following the success of Limassol Marina,
there has been a swell of interest in these types
of projects. The €300 million luxury Ayia Napa
Marina – which is transforming the area – has
graduated to its second phase, with berthing facilities
now fully operational. The marina offers
capacity for 600 yachts of up to 60 metres, a shipyard,
and a range of luxury villas and facilities.
With significant Egyptian investment backing
the innovative project, the seafront residences,
which will be completed by 2023, are already
being marketed to investors worldwide. In addition,
the €110 million Paralimni Marina project
is well under way, with additional development
incentives approved by the government in 2020.
The tender for Larnaca Marina received approval
in August 2020 and is expected to attract €1.2
billion in construction and real estate development,
while plans are in place for a luxury marina
in Paphos.
The number of foreign investors closing
multimillion-euro deals in the last few years
underlines the fact that tourism-related real
estate and infrastructure continues to be one of
the most attractive investment opportunities in
Cyprus. With solid and continuous interest in the
tourism sector, the country’s investment promotion
agency Invest Cyprus has set up a dedicated
and specialised unit, TourInvest, to promote investment
opportunities in the tourism and hospitality
sector. In cooperation with the Deputy
Ministry of Tourism and other stakeholders, the
unit focuses on attracting investment into largescale
infrastructure projects that exist in diversified
thematic areas.
Worthwhile investments have already been
made in the hospitality industry with acquisitions
and the construction of new luxury hotels of wellknown
hotel management chains. These include
the prestigious Sun City Spa and Residences by
Chinese group Jim Chang Global with an initial
investment of €100 million to construct a fivestar
resort hotel and exclusive beachfront residences
in cooperation with the Giovani Group.
The Radisson Hotel Group, one of the largest and
most dynamic hotel groups in the world, has big
plans to grow its existing portfolio in the country
to six hotels and almost 1,000 rooms by 2025.
In 2019, the Luxury Collection, part of
Marriott International, opened the Parklane
Luxury Collection Resort & Spa resort in
Foriegn Direct Investment
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