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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The sectors that<br />
have seen the most<br />
significant FDI<br />
are banking, shipping,<br />
retail, tourism,<br />
pharmaceuticals<br />
and energy,<br />
while new luxury<br />
and infrastructure<br />
developments are<br />
underway across<br />
the country with<br />
significant foreign<br />
investor backing.<br />
Foriegn Direct Investment<br />
Professional<br />
services are<br />
constantly<br />
being<br />
upgraded<br />
in order to<br />
meet the emerging needs of<br />
businesses, investors and the<br />
society in the post-Covid-19<br />
era. Technology and the<br />
provision of remote services<br />
are now key, increasing the<br />
likelihood of saving time while<br />
creating economies of scale.<br />
I expect that the sector will<br />
adapt once again to the new<br />
business environment, as<br />
the country’s professionals<br />
foster their efforts towards<br />
the recovery of the sector.<br />
Christos V Vasiliou<br />
Managing Director<br />
KPMG <strong>Cyprus</strong><br />
of new technology and products. The sector<br />
saw new investment in July 2018, with South<br />
Africa’s telecom MTN Group – which entered<br />
the Cypriot market 11 years ago and has around<br />
one-third of the market – selling its <strong>Cyprus</strong><br />
operations to Monaco Telecom S.A. in a €260<br />
million deal. In 2019, the company was rebranded<br />
Epic, and the group announced strategic cooperation<br />
with China’s Huawei on developing a<br />
5G network in <strong>Cyprus</strong>.<br />
CAPITALISING ON OPPORTUNITIES<br />
Time and again, <strong>Cyprus</strong> has proven its resilience<br />
as an economy and FDI location. Having endured<br />
a challenging economic climate earlier this<br />
decade, and now tackling the effects of the global<br />
coronavirus pandemic, <strong>Cyprus</strong> has nevertheless<br />
exceeded expectations and the transformation its<br />
economy is going through today, presents many<br />
opportunities for serious investors.<br />
To further enhance investor interest, the government<br />
is making staunch efforts to improve its<br />
FDI framework and has vowed to cut through<br />
red tape. Reforms accelerated in <strong>2020</strong> include a<br />
specialised commercial court and upgrades to<br />
the judicial system, as well as targeted incentives<br />
to better facilitate investment. These efforts have<br />
been recognised, with <strong>Cyprus</strong> seeing an increase<br />
in FDI and the registration of new companies<br />
setting up on the island.<br />
<strong>Cyprus</strong>’ open economy, European Union status<br />
and established role as a regional business hub<br />
between three continents continue to appeal to<br />
investors. The island also hosts a thriving forex industry<br />
with many global giants basing their operational<br />
headquarters in <strong>Cyprus</strong>. In addition, the investment<br />
funds sector has grown exponentially in<br />
the last few years with continuous upgrades to the<br />
regulatory framework. Assets under management<br />
have more than tripled from €2.1 billion in 2012<br />
to €7.97 billion in the second quarter of <strong>2020</strong>, recording<br />
a 5.3% increase over the first quarter of the<br />
year. If recent growth rates are sustained, industry<br />
experts predict assets under management could<br />
reach €20 billion in the next five years.<br />
<strong>Cyprus</strong>’ liberalised FDI Policy, both for EU<br />
citizens and investors from third countries, along<br />
with its favourable tax regime makes it one of the<br />
most attractive investment targets in Europe. At<br />
12.5% <strong>Cyprus</strong>’ corporate tax rate is one of the<br />
most competitive in the EU, and its extensive<br />
network of double taxation treaties with 65 countries<br />
have strengthened its position as a business<br />
gateway and a preferred location for corporate<br />
headquarters. The country’s skilled talent, low<br />
cost of doing business, top-tier professional services,<br />
and high quality of life renders <strong>Cyprus</strong><br />
not only a wise business choice but also a great<br />
relocation destination. As work progresses on<br />
implementing structural reforms to bolster the<br />
business environment, the attractive incentives<br />
and the ever-expanding opportunities will continue<br />
to attract foreign investors. n<br />
Discover more at www.cyprusprofile.com<br />
<strong>Country</strong> <strong>Report</strong> CYPRUS <strong>2020</strong> 31