2020 Cyprus Country Report
The 2020 Cyprus Country Report features in-depth articles on the economy, foreign direct investment, international trade and headquartering as well as detailed sector profiles and insights from Cyprus’ 100 most influential political, economic and business leaders shaping the future of their country and its industries.
The 2020 Cyprus Country Report features in-depth articles on the economy, foreign direct investment, international trade and headquartering as well as detailed sector profiles and insights from Cyprus’ 100 most influential political, economic and business leaders shaping the future of their country and its industries.
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operations, the island is sharpening its competitive<br />
edge by streamlining processes, modernising<br />
legislation, introducing incentives and<br />
speeding up licensing procedures to better cater<br />
to investors. Special schemes and incentives are<br />
in place to facilitate headquartering, which covers<br />
the sectors of technology, asset management, investment<br />
funds, shipping and higher education,<br />
‘Olivewood’ for the international film industry,<br />
the Startup Visa for non-EU nationals and a<br />
Fast Track Business Activation Mechanism for<br />
non-EU nationals approved in September <strong>2020</strong>.<br />
PRIVATISATIONS AND LARGE-<br />
SCALE PROJECTS<br />
<strong>Cyprus</strong>’ FDI appeal has been on an upward trajectory<br />
with the economy posting a healthy 3.2%<br />
growth in 2019 and following improvements in<br />
its macroeconomic and financial environment,<br />
factors that have also revived international interest<br />
in around 30 major development projects on<br />
the island. Investment opportunities in <strong>Cyprus</strong>’<br />
large-scale projects span various sectors, including<br />
high-value tourism and housing developments,<br />
projects with a special focus on golf<br />
courses and luxury marinas, as well as education,<br />
energy and, more lately, the international film<br />
sector.<br />
The liberalisation of markets in which stateowned<br />
entities used to dominate presents new<br />
opportunities in terms of FDI. The 2017 commercialisation<br />
of the country’s largest port in<br />
Limassol marked a new era for <strong>Cyprus</strong> as a commercial<br />
hub. The privatisation deal with Eurogate<br />
International GmbH and DP World Limited is<br />
expected to boost state coffers with €2 billion<br />
over the next 25 years, while the new port operators<br />
are injecting millions in upgrading services<br />
and infrastructure. The coming full liberalisation<br />
of electricity is also presenting new opportunities<br />
in the natural gas and renewables sectors.<br />
PERFECTING THE TOURISM PRODUCT<br />
Tourism has long been a driving force of the<br />
Cypriot economy and a concerted effort to diversify<br />
its offering in recent years has paid off.<br />
Ahead of the global pandemic, expansion of capacity<br />
as well as quality upgrades saw both arrivals<br />
and expenditure break new records for four<br />
years running. <strong>Cyprus</strong> has been attracting new<br />
interest by developing conference, sports, health<br />
and wellness and by extending the tourist season.<br />
The construction and investment in multipurpose<br />
projects and mixed-use developments such as<br />
luxury marinas, golf courses and more recently<br />
the island’s first-ever and only integrated luxury<br />
casino resort, are all part of the ongoing strategy to<br />
upgrade <strong>Cyprus</strong>’ tourism product. The temporary<br />
casino has started operations and the full integrated<br />
casino resort, City of Dreams Mediterranean,<br />
will have extensive facilities and five-star status<br />
by 2021. The casino resort is Hong Kong-based<br />
Melco’s first expansion outside of Asia and will be<br />
the biggest casino of its kind in Europe, with the<br />
investment for this mega project at €600 million.<br />
Following the success of Limassol Marina,<br />
there has been a swell of interest in these types<br />
of projects. The €300 million luxury Ayia Napa<br />
Marina – which is transforming the area – has<br />
graduated to its second phase, with berthing facilities<br />
now fully operational. The marina offers<br />
capacity for 600 yachts of up to 60 metres, a shipyard,<br />
and a range of luxury villas and facilities.<br />
With significant Egyptian investment backing<br />
the innovative project, the seafront residences,<br />
which will be completed by 2023, are already<br />
being marketed to investors worldwide. In addition,<br />
the €110 million Paralimni Marina project<br />
is well under way, with additional development<br />
incentives approved by the government in <strong>2020</strong>.<br />
The tender for Larnaca Marina received approval<br />
in August <strong>2020</strong> and is expected to attract €1.2<br />
billion in construction and real estate development,<br />
while plans are in place for a luxury marina<br />
in Paphos.<br />
The number of foreign investors closing<br />
multimillion-euro deals in the last few years<br />
underlines the fact that tourism-related real<br />
estate and infrastructure continues to be one of<br />
the most attractive investment opportunities in<br />
<strong>Cyprus</strong>. With solid and continuous interest in the<br />
tourism sector, the country’s investment promotion<br />
agency Invest <strong>Cyprus</strong> has set up a dedicated<br />
and specialised unit, TourInvest, to promote investment<br />
opportunities in the tourism and hospitality<br />
sector. In cooperation with the Deputy<br />
Ministry of Tourism and other stakeholders, the<br />
unit focuses on attracting investment into largescale<br />
infrastructure projects that exist in diversified<br />
thematic areas.<br />
Worthwhile investments have already been<br />
made in the hospitality industry with acquisitions<br />
and the construction of new luxury hotels of wellknown<br />
hotel management chains. These include<br />
the prestigious Sun City Spa and Residences by<br />
Chinese group Jim Chang Global with an initial<br />
investment of €100 million to construct a fivestar<br />
resort hotel and exclusive beachfront residences<br />
in cooperation with the Giovani Group.<br />
The Radisson Hotel Group, one of the largest and<br />
most dynamic hotel groups in the world, has big<br />
plans to grow its existing portfolio in the country<br />
to six hotels and almost 1,000 rooms by 2025.<br />
In 2019, the Luxury Collection, part of<br />
Marriott International, opened the Parklane<br />
Luxury Collection Resort & Spa resort in<br />
Foriegn Direct Investment<br />
<strong>Country</strong> <strong>Report</strong> CYPRUS <strong>2020</strong> 27