Professional and financial services sector supports vision of international business hub
Cyprus’ professional services sector is helping to power the country out of recession and generate international recognition. The industry has played a key role in facilitating a move away from offshore transactional business, a change brought about after the 2013 crisis and the scrutiny that followed.
Audit, consultancy and legal services are all offered but unlike some territories, the Eastern Mediterranean nation has developed an innovative market that sees companies supporting each other to succeed. Cyprus’s location has also enabled it to tap into emerging markets, Iran being one example, while its workforce have used their expertise in niche sectors to secure clients in diverse markets.
For Kikis Treppides, Managing Partner and Chairman of K. Treppides & Co Ltd, the sector has a clear role in propelling Cyprus’ long-term economic success. Over the past few years, K. Treppides & Co itself has innovated and adapted, diversifying into new business areas such as funds.
“Through the professional services sector, mainly lawyers and accountants have actively assessed the factors that resulted to the 2013 crisis and have managed to sustain the international business that was and is operating through Cyprus,” he explains.
“Taking into consideration the current compliance and regulatory requirements taking place in the EU and worldwide, the sector has identified the opportunities available and has set the cornerstones for Cyprus to be established as a hub for investment firms, financial institutions and funds. These services are the services that will be one of the pillars of growth of the Cyprus economy.”
It’s a point shared by Demetra Kalogerou, Chairwoman of Cyprus Securities Exchange Commission, who says that the country is now perfectly positioned to attract fund managers.
“We have the entire regulatory regime and all the European directives in place and we have a national law that gives the power to establish different alternative funds,” she says. “We have also different investment policies that they can use and I think we have all the tools for fund managers to establish here and issue funds.”
Green shoots are emerging and the country’s revamped financial sector is providing a more solid footing while across the professional services sector, the expertise of the workforce has been sustained and international firms remain keen on Cyprus.
“After the problems in 2013, we thought everyone was going to leave the country, but what is happening is the opposite,” says Andreas K. Christofides, Board Member and Managing Director at KPMG. “We are getting a lot of new businesses; people are coming to set their bases here. It is logical for people from Europe working in the Middle East or working with Russia, Ukraine or Eastern Europe.”
The country was an early adopter of the Foreign Account Tax Compliance Act and the revised European Savings Directive, both of which are enabling Cyprus to improve ties with European partners and countries across the Middle East and North Africa.
And yet while Cyprus is becoming a regional business hub, recent reforms are likely only the beginning. As Evgenios Evgeniou, CEO of PwC Cyprus explains, the key to economic success will be a long-term focus on regulatory practices.
“In terms of this growth becoming sustainable, it is key that we continue with the reforms that make the economy more competitive and doing business easier,” she says. “These reforms will facilitate both business activity and foreign investment whilst having in place a robust and transparent regulatory framework.”