After a devastating banking crisis in 2013, Cyprus’ economy is bouncing back as the Mediterranean Island positions itself as not only an idyllic place to live and play, but a choice destination for foreign investment dollars
“I firmly believe resilience was a key element in this country’s recovery,” said Christodoulos E. Angastiniotis, Chairman of the Cyprus Investment Promotion Agency (CIPA). “It’s clear that the majority of Cypriots accepted our own shortcomings early on and this was the first step in order to move forward. Having recognised our weaknesses we treated the crisis as an opportunity to fix things and create a more stable, efficient and attractive economy.”
The fixes include curtailing government bureaucracy and streamlining procedures aimed at reducing cost to the private sector and encouraging a more pro-business environment. A member state of the European Union since 2004, the small but dynamic country has played a role in global trade for centuries. Its place at the crossroads of three continents, Europe, Asia and Africa makes it an attractive hub for international commerce, a position enhanced by the recent discovery of significant hydrocarbon reserves in the country’s Exclusive Economic Zone (EEZ).
After years of exploration a consortium led by U.S. gas giant, Noble Energy has discovered a reserve of more than 127 billion cubic meters of natural gas offshore in the Aphrodite gas field. The sector is being targeted for development as Cyprus seeks to carve a role for itself as a major regional energy provider.
“The investment map of our country has changed significantly over the last few years, FDI (Foreign Direct Investment) into Cyprus probably reached its highest level in 2014,” said Mr. Angastiniotis, pointing to the infusion of capital into the banking and leisure sectors from overseas investors.
Tasked with coordinating and attracting new investment to the country, CIPA is highlighting the country’s robust legal and regulatory framework, as a key competitive advantage.
“For a lot of investors, it’s a combination of a transparent legal framework based on English Common Law-arguably the most comprehensive tax system in the EU-and the strength and benchmark expertise of Cyprus’ legal, financial, and administrative services,” said Mr. Angastiniotis. “It’s a comprehensive support package for doing business where almost everybody speaks English.”
Cyprus boasts other assets including a high standard of living. Even in the midst of its financial crisis, Knight Frank, a global property and relocation firm ranked Cyprus the 5th best place to relocate, notes Mr. Angastiniotis.
An efficient business infrastructure and superior quality of life make up a big part of the marketing pitch for foreign dollars and the energy generated from the campaign could be impetus for Cyprus to finally resolve the division that has dogged the country for decades.
Looking to the future, Mr. Angastiniotis, sees high growth potential in ICT, R & D, and innovation, effectively creating a knowledge-based economy. This would leverage on the main competitive advantages of Cyprus, especially its highly educated and experienced professionals. Cyprus has embarked on a collective quest to create a more efficient, flexible, transparent and investment-friendly environment. Cyprus is changing from the ground up, according to Mr. Angastiniotis: “We are rebuilding a different Cyprus, not just a different Cyprus brand.”