Press Releases

Friday, 28^th April, Delphi, Greece

I am very plased to welcome you to this event organized by Invest Cyprus.

The Cyprus economy has come a long way in the past few years, and through this journey has proven its resilience. Cyprus has succeeded in recovering and re-establishing itself as an attractive destination for foreign investment, enjoying a highly educated workforce, strategic location, and favorable business environment.

Despite the challenges that the global economy is facing, due to the aftermath of the Covid pandemic and the ongoing war in Ukraine with the illegal Russian invasion, the Cyprus economy continues to demonstrate strong growth rates. More specifically, in 2021 and 2022 we experienced 6.6% and 5.6% growth rates respectively, one of the highest in the EU, while maintaining low unemployment rates. The forecast for 2023 and the years to come are also very positive, lower but still positive.

Strong growth rates are the result of a three-pillar policy approach: fiscal discipline with government budget surpluses, consolidation of the banking sector and promotion of structural reforms.

At the same time, in 2022, we introduced a Strategy for attracting businesses and talent to the island. This encompasses the establishment of a Business Facilitation Unit and a package of tax and other incentives for companies that wish to set up headquarters or a regional base in Cyprus.

Moreover, we have also developed a long-term strategic plan for the economy –Vision2035– aiming to promote entrepreneurship and innovation, and attract investment in high-growth sectors such as tourism, shipping, and energy. The plan also focuses on human capital and skills development, on Green Growth and Digital Transformation.

All Government strategic planning is supported by EU funds, namely the Recovery and Resilience Programme and the Thalia Programme, covering the period up to 2027.

As a result of this multi-dimensional approach, Cyprus is attracting FDI in finance, shipping, tourism, information and communication, retail trade, health, tertiary education and professional services, in particular head-office activities.

As regards the important shipping sector, Cyprus has a well-developed infrastructure, including modern port facilities, ship repair yards, and a comprehensive legal and financial services sector supporting the shipping industry. The country has invested heavily in expanding and upgrading its port facilities, with the Port of Limassol being the largest and most important port in the country. The sector benefits from a competitive tax system, while developing its position in the maritime technology sector, offering opportunities for investment in areas such as ship management software, cybersecurity, and drone technology for maritime surveillance.

Cyprus's tourism sector is one of the fastest-growing in the Mediterranean, attracting millions of tourists each year.

The energy sector is also growing, with the discovery of significant offshore gas reserves, presenting opportunities for investment in infrastructure and services. The Russian invasion in Ukraine has put at the forefront in the EU the need for energy independence and diversification, and Cyprus can play an important part in these efforts of the EU.

The financial services sector is also experiencing growth, driven by the implementation of new regulations and the introduction of new financial products and services. The government has also launched initiatives to promote fintech, making Cyprus a regional hub for research and innovation.

Our Government took office very recently in March 2023 and has already set in motion an ambitious Governance programme with bold reforms, aiming to broaden the productive base of the economy, fully capitalizing on research and technology and utilizing our country’s rich human talent. 

In this respect we fully endorse the long-term economic strategy “Vision2035”, setting a roadmap for the country's development and growth over the next decade.

Amongst our highest priorities is the promotion of a comprehensive tax reform, aiming at the reduction of administrative burden for tax payers and businesses, while retaining the system’s attractiveness.

As regards the green transition, we are fully committed to the EU’s Green Deal. We focus particularly on subsidizing green initiatives and further promoting the use of Renewable Energy Sources in the country’s energy mix, including through RES storage infrastructure.

We also promote a number of actions for ensuring a swift digital transition, while enhancing the country’s capacity in maintaining a favorable business environment, more simplified and with less red tape.

I have mentioned how our adherence to fiscal discipline and the promotion of structural reforms is making Cyprus an attractive business and foreign investment destination.

There is also another critical factor and that is Cyprus’s foreign policy. We have worked methodically during the last years in building strong ties both with countries in the wider Eastern Mediterranean, the Middle East and the Gulf, as well as with the United States, where there have been leaps of progress in building a truly strategic partnership. At the same time, we have worked on enhancing in tangible terms our relations with important players such as India –that I plan on visiting with a business delegation in the first half of 2024– and Japan.

I want to take this opportunity to underline that I am personally committed, the Government is committed in taking all necessary actions to protect the reputation of Cyprus as a credible business and investment centre. We are working tirelessly on not only fully investigating but also establishing a strong supervisory framework, including the establishment of a fully-fledged National Sanctions Implementation Unit, with technical support by the UK Government.  

In recent years, Cyprus has taken significant steps to enhance its AML regulations and strengthen its supervisory framework. The government has introduced new legislation and regulations, increased the number of AML supervisors, and invested in training and capacity building. Furthermore, the Central Bank of Cyprus has been actively working to reduce the number of non-resident deposits in Cypriot banks, particularly those from high-risk jurisdictions.

In concluding, I wish to note once again the significant progress of the Cyprus economy, with strong GDP growth, improved public finances and declining unemployment rates. The country offers investors attractive opportunities across several sectors and a friendly business environment.

On my side, I assure you that the government will continue working tirelessly, in order to create an enabling environment for businesses to thrive.

(RM/NG/SCH)