IMPORTANT UPDATE: It’s official, Cyprus closed its popular citizenship by investment program on 1 November 2020. What this means is investors will no longer be able to directly acquire a Cypriot passport by investment.
A new program has taken place, however. The Cyprus Golden Visa provides individuals with an alternative route to permanent residency in Cyprus. Those looking for European citizenship can also apply to the Malta citizenship program, which offers a direct investment route to a Maltese passport.
Are you interested in placing foreign investments in an overseas country, but are not sure which country to go with? You might want to invest in Cyprus. While there are a number of investment opportunities worldwide, not many of them come close to those offered in Cyprus, which is a prime investment destination full of lucrative opportunities.
One of the most important factors to consider as a foreign investor is location, especially when it comes to property investments. Aside from being a member state of the European Union, Cyprus is located in a unique geographical position with close access to both Europe and the Middle East, which has made it a vital trade centre for thousands of years, and an incredible international hub.
The country’s investment potential has risen exponentially in recent years and this has resulted in the Republic becoming increasingly popular among foreign investors.
Cyprus is a Popular Investment Hub
After the unfortunate financial crises rocked the nation and resulted in the crash of Cyprus’ economy, the Republic became a popular investment hub among investors, especially after it kick-launched its permanent residency and Cyprus Citizenship by Investment schemes.
Investors who are serious about expanding their business operations, or even diversifying their portfolios, are entering the Cypriot economic sphere in their drones by creating overseas permanent establishments, which has only resulted in a positive economic outlook for both the nation, and its foreign investors.
Those who are looking to invest in Cyprus might want to know the several benefits that may act as an added value to their foreign investments, including benefiting from:
- Cyprus’ strategic location and overall standard of living;
- Its highly educated workforce that is youthful, creative, and dedicated to growth;
- Its magnificent and highly reliable transport system;
- Its top-notch communications structure;
- The Cyprus tax for non-residents
Is it a Good Time to Invest in Cyprus?
The best time to invest in Cyprus is now as it is emerging as one of the best investment destinations in the world for certain key industries, and as a top financial center in the Mediterranean. The Cypriot economy is constantly growing and it has been projected to continually grow due to the efforts of its government to ensure that investments keep coming in from international corporations, foreign companies, and foreign nationals.
The government is offering a number of generous incentives for anyone looking to place an investment in its economy, which has led to an increase in material resources, as well as human resources. Today, there is a genuine interest in the promotion of innovative ideas that will take the country to the next level.
Entrepreneurship thrives in the Republic’s private sector, as well as in other key economic sectors, as government officials are working tirelessly to curtail government bureaucracy. Procedures for business owners have been streamlined and made easy by removing delays and excess costs.
Rapid Increase in Foreign Investment
Since the presence of foreign direct investment is crucial to the economic recovery of the Republic, many incentives have been placed by the Cypriot government for investors to take part in the growth of its economy and maintain their investments as well. These incentives have been so appealing that they have caused a rapid increase in the number of Chinese, British, and Russian investors in the country.
The increase in demand for housing, for example, out of a rise in tourism and migration has subsequently led to the growth of certain industries such as the construction industry.
Benefits of Investing in Cyprus
There are many benefits to be reaped by those who want to invest in Cyprus, from having a high return on investment and enjoying tax benefits, to accessing the EU market and benefiting from internationals laws and easy bureaucratic procedures, among other things — all of which has led the country to increase in popularity among foreign investors.
The most commonly shared benefits are:
1. Efficient Banking and other Professional Services
The Cypriot banking system is properly designed for ease of doing business, which is an added benefit for foreign businesses. Cyprus has a very organized banking system that consistently takes care of the diverse needs of individuals as well as companies.
There is a large pool of highly skilled and educated professionals who are willing to provide their services in multiple languages to accommodate their international clients. These multilingual professionals often offer their services in Greek, Turkish, Russian and English. Not only are investors able to communicate their needs in their native language, they also get magnificent legal, accounting, management consultancy, and other professional services for great prices as well.
2. Infrastructural development
Cyprus has experienced immense growth in key areas that support the development of domestic companies. With huge investments being placed in telecommunications, shipping, and transportation, the country boasts a world-class infrastructure that makes running a business and managing life a much easier task than anticipated.
With great transportation networks that provide an easy commute across the entire Republic, two deep seaports located in Larnaca and Limassol, and two world class international airports which play a very integral role when it comes to linking Cyprus to other parts of the world, there’s not much to complain about.
3. Connection to Europe
Since gaining membership into the European Union in 2004, Cyprus has maintained its connection to European markets across the continent. Today, the country has become a guaranteed entry point into the European sphere for those who can afford it
Once Cyprus became an EU country, its membership was seen as a vote of confidence by investors that it is a stable and safe haven for them. Cyprus is considered a telecommunications center in Europe due to its satellite and submarine fibre optic cables that connect it to other parts of Europe. As a result of this, the country has lightning-speed fast internet.
The country’s strategic location is one of the major selling points when it comes to encouraging and cultivating foreign investment opportunities. Cyprus is located between Africa, Europe, and Asia. This puts the country in a vantage position that allows it to act as an exchange point for countries in all three continents. Cyprus is an active center when it comes to facilitating the shipment of goods in and out of Europe.
Cyprus offers investors a unique opportunity to obtain a permanent resident permit which can lead to a subsequent Cyprus/EU citizenship. Although similar schemes in other countries would normally take over 6-8 years, you can secure Cypriot citizenship within 3-4 months. A major upside to the citizenship that is offered by Cyprus is that it neither requires the investor to reside in Cyprus, nor does it require them to become tax residents.
Where to invest?
As a member of the European Union, Cyprus is one of the market leaders that are backed up by a stable currency and developed regulations. There are numerous thriving sectors and industries to benefit from when placing an investment; such as real estate, tourism, government bonds, and so on.
The tourism industry is probably one of Cyprus’ most resilient economic sectors, and that is mainly because Cyprus is blessed with natural scenery that has been diligently maintained.
This has resulted in the overall enhancement of its competitive edge as a premium tourist destination, which consequently resulted in an increase in strategic large-scale projects across the nation that are poised to further stimulate the industry’s boom.
Cyprus is fast approaching the status as one of the emerging investment fund centers in Europe. The country’s determination to stay at the fore has driven its government to offer investors unique access to growing markets.
The Republic has become a key regional domicile when it comes to setting up investment funds as well as establishing asset management companies and financial institutions. These companies have gotten far beyond the shores of Cyprus and they have been able to attain Pan-European reach.
Advantages of investing in Cyprus
There are several benefits that investors can get by putting their money into the Cypriot economy, aside from the low crime rate in Cyprus which means that their investments are safe from any form of external mishaps that often occur in other countries. Some of these advantages include:
High quality of lifeThe quality of life in the country is also noteworthy and very commendable. This quality is made better due to the fact that the cost of living is relatively low.
Higher investment in the countryThe growth of emerging investments across industries such as the tourism industry is pretty remarkable. The tourism industry alone is predicted to grow by about 5% over the next decade, which is great news as far as immovable property investors are concerned.
Stable economyThe nation’s economy is characterized by stability and robustness, which has led to constant positive evaluations by the European Commission and the International Monetary Fund.
Similar legal and financial systemsThe Cypriot legal and financial systems are similar to the financial system models of the UK.
Disadvantages of investing in Cyprus
Like with any other location, there are some downsides to investing in Cyprus. A common complaint of those who invest in Cyprus is that some parts of the country are not as developed as others. Some other disadvantages include:
It’s necessary to take legal adviceThere is a likelihood of buying a property that already has debts if you do not take proper legal advice.
Tourist areas are overcrowded during summerThe popular tourist areas are often overcrowded during the peak of the summer season.
There are restrictions on letting out your propertyInvestors often frown upon the restrictions that are put on letting out their property.
Is it worth it to invest in Cyprus?
Cyprus has branded itself as a country where its real value is created through the nurturing of creative ideas. This feature has made it a home for many young entrepreneurs and foreign investors looking for growth and access to the European marketplace.
Cyprus is a perfect choice when it comes to starting up all kinds of small and large scale companies. It is still advisable, however, to get sufficient legal advice before deciding on making any investments.
Frequently Asked Questions
Is it good to invest in Cyprus?
An investment in Cyprus will prove itself lucrative to anyone interested in diversifying their portfolio or expanding their business activities. The Cypriot market as well as the Cypriot government are both truly accommodating to all foreign investors and entrepreneurs.
What is the best investment in Cyprus?
Some of the best investments may be placed in Cyprus real estate, as the tourism industry there is constantly booming. It is actually one of the main contributors to Cyprus’ economic growth.