Evgenios Evgeniou, Chairman of Invest Cyprus, explains the importance of the annual International Investment Awards hosted by GOLD and why the prospects for attracting new investments to Cyprus are promising, in spite of the current global economic and geopolitical challenges.
Why has Invest Cyprus been holding the International Investment Awards for the last ten years? Why is it important to recognize and reward international companies?
Attracting foreign companies to set up and to invest in Cyprus is crucial for the country’s efforts to achieve sustainable growth and to create new jobs. Its also important in diversifying the economic model in line with “Vision Cyprus 2035” and the priorities of the green and digital transition. Invest Cyprus acts as the first point of contact for existing and potential investors who choose Cyprus to develop their business case, offering facilitation and after-care support. The level of satisfaction of these companies and investors is of vital importance as they are the best ambassadors of the country abroad. The International Investment Awards represent a gesture of appreciation to these investors for their vote of confidence in our country and it is an opportunity to showcase these successes to other investors interested in Cyprus.
How do you view the current state of the foreign investment landscape in Cyprus?
Despite the economic and geopolitical challenges, the prospects for attracting new investments are promising. In response to the newly introduced, targeted incentives announced by the Government, there is constantly growing interest from foreign businesses, particularly those operating in the ICT sector, to expand their operations or establish a presence in Cyprus.
In what ways has investor interest and preference changed over the years? Which sectors have the best potential for development in Cyprus?
Invest Cyprus focuses its efforts on the following three pillars:
- Attracting international companies and highly specialized employees
- Supporting foreign investment in strategic sectors for the economy, including the green and digital transition
- Maintaining the country’s competitiveness as a jurisdiction for international financial services
In recent years, all three pillars have experienced growth. A new business cluster, beyond shipping, is developing in the technology space, Alternative Investment Funds grew by 61.5% in 2021, there is keen interest in investments in renewables and Cyprus has been chosen as a filming location for several high-profile international productions.
In your opinion, what can be done both by the public and private sectors to boost foreign investment and to resolve the challenges facing international companies when deciding to relocate to the island?
This requires good cooperation across ministries and government departments and a partnership with the private sector. It’s a national effort. Improving our country’s competitiveness and attractiveness is a vitally important in attracting investment. We constantly monitor global competition, review our Foreign Direct Investment (FDI) framework, and adopt effective incentives. The implementation of all relevant reforms is equally important, including those in the Cyprus Recovery and Resilience Plan. The Government has recently launched a redesigned strategy to attract foreign companies and highly skilled talent. The strategy mainly focuses on high-tech, shipping, pharmaceutical, innovation and research and development companies. The action plan includes a series of enhanced, upgraded and simplified tax, residency and employment incentives, which have already had a positive impact when it comes to choosing a location for international business.
Taking into account global current affairs such as the pandemic and the conflict in Ukraine, how do you expect entrepreneurship and investment in Cyprus to be affected in the near future?
Undoubtedly, we are experiencing a prolonged period of volatility, hence adapting to the new environment is challenging both for local and international businesses. Regarding FDI, unprecedented conditions always lead to uncertainty and procrastination. According to the World Investment Report 2022 launched by the United Nations Conference on Trade and Development (UNCTAD), FDI recovered to pre-pandemic levels in 2021, reaching nearly $1.6 trillion. However, this growth is unlikely to continue in 2022. Despite this, investors will still be looking for the most promising proposals. To stand out from the international competition, the public and private sectors, working together, must coordinate and intensify their efforts to attract new businesses to set up and to invest in Cyprus as well as to improve the investor experience that the country offers. To this end, Invest Cyprus will work with all stakeholders, in the private and public sector.