WM issue 5

| 4 | EDITORIAL

A New Era

of Wealth

Management

PUBLISHED BY

Welcome to the 5th edition of

WM, the Cyprus Journal of

Wealth Management. At this

time last year, we expressed

the hope that 2022 would see

the end of the COVID-19

pandemic and, indeed, things

have changed a great deal

since then. However, we could

not have imagined that our

experience with the coronavirus

would be immediately

followed by an enormous humanitarian

crisis, this time brought about by Russia’s invasion of Ukraine, which continues

to cause geopolitical and financial uncertainty across the world.

For this edition of WM, we have interviewed experts and professionals who discuss the global

impact of the Ukrainian crisis and its effect on various sectors of the Cyprus economy.

The topic also formed a major part of a discussion (see ‘Business Talk’) between Finance

Minister Constantinos Petrides and a select gathering of businesspeople. Moreover, it naturally

arose at an informal gathering of members of the Cyprus-UK Business Association

at the UK High Commissioner’s residence in Nicosia, at which bilateral and trade relations

between the two countries were discussed.

The adverse events of recent years have undoubtedly influenced investors and HNWIs and

have taught financial services firms and wealth managers the significance to business resilience

of virtual engagement. Wealth management experts are now called upon to cater to

the sophisticated demands of their clients by offering new-era services. If they are to keep

up with trends such as sustainable investing, they still need to provide a personalised client

experience but one that can be considerably enhanced through the use of advanced technology.

This is noted in a number of articles on Wealth Management, while others deal with

issues relating to Trusts, Investment and Estate Planning in the new era.

This 5th edition of WM also includes exclusive interviews with a host of outstanding individuals,

including the French Ambassador to Cyprus, Salina Grenet-Catalano, Medochemie

Founder Dr Andreas Pittas, NAGA Co-founder Benjamin Bilski and CEO Michael Milonas,

New York-based Senior VP and Global Creative Director at Estée Lauder Companies

Klitos Teklos and LA-based film composer, George Kallis.

You can also read interviews with four outstanding women at the helm of voluntary organisations

and take a look at the personal collections of three well-known businessmen. Other

lifestyle features showcase art galleries in Cyprus, luxury furniture stores and high-end international

chain restaurants.

We hope that you enjoy reading the 2022 edition of WM and, more importantly, that by

the time the next one comes into your hands, we shall all be living in a much happier, more

peaceful world.

Artemis Constantinidou

CHIEF EDITOR

IMH

MANAGING DIRECTOR

George Michail

GENERAL MANAGER

Daphne Roditou Tang

MEDIA MANAGER

Elena Leontiou

BUSINESS CONTENT ADVISOR

Antonis Antoniou

SENIOR EXECUTIVE EDITOR

John Vickers

EDITOR-IN-CHIEF

Artemis Constantinidou

JOURNALISTS

Adonis Adoni

Marianna Nicolaou

Athena Yiazou

ART DIRECTION

Anna Theodosiou

SENIOR DESIGNER

Alexia Petrou

GRAPHIC DESIGNERS

Anna Maria Michael

Stavros Lambrou

PHOTOGRAPHY

TASPHO

Michalis Kyprianou

Giorgos Charal

MARKETING MANAGER

Kevi Chishios

SALES MANAGER

Neofytos Constantinou

SALES EXECUTIVES

Praxoulla Valiandi

Andreas Leontiades

CONTACT

5 Aigaleo St., Strovolos 2057, Nicosia, Cyprus

Mailing address:

P.O.Box 21185, 1503, Nicosia, Cyprus

Tel: +357 22505555, Fax: +357 22679820

e-mail: info@imhbusiness.com

www.imhbusiness.com

EDITORIAL

| 5 |

Stasandrou and Aphrodite 2, 1060, Nicosia

Tel: 22757929

Archbishop Makarios III 227, 3105, Limassol

Tel: 25587949

| 8 | CONTENTS

90

16

65

120

Contents

98

12 | A New-Generation Private Banking Model

By Fokion Karavias.

I S S U E 5

16 | The Ever-Changing Private Banking Landscape

Interview with Haris Hambakis.

20 | Opportunities for Banks Continue to Arise

Interview with Andreas Petsas.

24 | Investment Outlook for 2022

Christos Elafros and the Global investment Advisory Division

team discuss the mid-year investment outlook for 2022.

32 | Sustaining Family Wealth Across Multiple

Generations

By Phryni Yiakoumetti Mina & Natalie Vassiliou Moustaka.

34 | Cyprus Macroeconomic Outlook

By Maria Kasola.

36 | Eurobank Cyprus General Managers

Profiles of four Departments and their respective Heads.

38 | Eurobank’s Five-Year Digital Transformation

Roadmap

Interview with Spyros Loizou.

42 | Affluent Banking: Dedicated Personal Services

for Successful Local Professionals

By Popi Hadjioannou.

44 | Investment Funds in Cyprus

By Konstantinos Xanthis.

46 | Cyprus International Trusts Bring Wealth

Protection – and Real Peace of Mind

By Constantinos Ignatiou, Rebecca Ephgrave &

Simona-Maria Ciurla.

47 | THE COLLECTORS

Three businessmen reveal the story behind their

collecting passion and the challenges they faced.

54 | Medochemie: Where Dioscorides Meets

El Greco

Interview with Dr. Andreas Pittas, Founder and

Executive Chairman, Medochemie.

57| Opportunities Beginning to Arise in a

Tough Year

By Savvas Theofilou.

110

58 | A Guide to Family Office Planning, Governance

and Succession

By Andreas Yiouselli & Constantinos Yiannikouris.

62 | Form Follows Function

The Founding Partners of UDS Architects on

their cultural influences and the challenge of

environmental sustainability.

65 | VOLUNTEERING AND PHILANTHROPY

Four Cypriot women on the importance of cultivating a spirit of giving.

74 | Cyprus and High Net Worth Individuals

By Valentinos G. Pavlides.

70 | BUSINESS TALK 1

Business leaders discuss the Ukraine crisis, the economy and

entrepreneurship with Finance Minister Constantinos Petrides.

88 | Protecting Your Legacy through a Cyprus International Trust

By Elena Christodoulou.

90 | The Long and Winding Road to Success

Interview with Benjamin Bilski and Michael Milonas of neobroker NAGA.

96 | Family Businesses Today: Rising Challenges in a Rapidly

Changing Environment

By Demetris Vakis.

98 | A Deepening Relationship

Interview with France’s Ambassador to Cyprus, Salina Grenet-Catalano.

101 | OBJECTS OF DESIRE

Two special stores that can help you turn your house into the

home you will truly love.

106 | Putting the Right Money in the Right Hands at the

Right Time

By Georgia Constantinou-Panayiotou.

110 | Emotional Connections

Inytervew with Klitos Teklos, Senior Vice President, Global

Creative Director at Estée Lauder.

114 | Generational Planning: Cyprus Wills and Trusts

By Stelios Christophides.

116 | Living the Dream

Interview with award-winning Cypriot film composer George Kallis.

118 | How to Buy Property in Cyprus with Cryptocurrency

By Savvas Savvides.

120 | Power Couple Sharing a Single Path

Gogo Alexandrinou and Charalambos Prountzos on how they

balance challenging careers with their parental duties.

123 | ART FOR ART’S SAKE

Four gallery owners discuss investing in art and enjoying it for its

own sake.

132 | Real Estate Opportunities: London as an International

Investment Destination

By Marios Hajiroussos.

134 | BUSINESS TALK 2

In May, members of the Cyprus-UK Business Association met

with Chris Barton, HM Trade Commissioner to Europe.

142 | Global Investment Outlook

By Loucas Savva CFA.

144 | Finest Dining

Fine-dining venues in Cyprus that collaborate with top

international chefs.

WELCOME LETTER | 9 |

Dear Friends and Valued Clients,

I

am delighted to welcome you to the fifth edition of the

Wealth Management journal, which is addressed to

Eurobank Cyprus Wealth Management clientele.

In this year’s edition, we provide an analysis of Cyprus’

Macroeconomic Outlook, offer an insight into Digital

Transformation, and analyse trends and services offered in the

fields of Affluent Banking and Investment Funds.

Moreover, Senior Executives of the Bank and Eurobank

Group share their thoughts on the present and the future goals

of our Group.

During the past two and a half years, global economies have

faced unprecedented challenges due to the pandemic, which

was followed by the war in Ukraine. Despite the uncertainty

created by the rise in the price of raw materials, energy and

consumer goods, our clients are always seeking new investment

opportunities, as well as tailor-made financial solutions.

Every crisis has to be approached as an opportunity for future

growth. Our main priority at Eurobank Cyprus is to build a

relationship of trust with our clients, while recognising their

unique profile and needs.

Eurobank Group is the only Banking Group in the region

that can serve Wealth Management clients with a wide range

of products and services across four different locations: Luxembourg,

the United Kingdom, Greece and Cyprus. All services

provided in the field of Wealth Management fall under

the umbrella of “Group Private Banking”, thus ensuring the

finest quality of service. With its experienced Executives and

Management and their combined expertise, it has repeatedly

delivered good results and has received numerous awards,

including “Best Private Bank” from numerous independent

organisations. Our Wealth Management philosophy has been

proven trustworthy, well-informed and accommodating to any

investment profile.

I would like to take this opportunity to thank you for your

continued loyalty and assure you that Eurobank Cyprus will,

as always, stand beside you. At Eurobank Cyprus we are

committed, not only to the financial success of the Bank and

its shareholders, but also to the success of our clients. Our

customer-centric approach, complemented by our wide range

of products and services, spearheads our efforts aimed at continuous

development and evolution in accordance with global

trends, technology and innovation in the Banking and Investment

sectors. Our main objective is to constantly improve our

products, services and quality of work. Digital Transformation

and the simplification of procedures and processes are also of

great importance and lie at the forefront of our strategy. We

aim to provide a digital environment that focuses on our clients

and is dynamically oriented to ever-changing market conditions.

Eurobank has gained a leading position in Cyprus and

has a firm focus on becoming the best Private Banking service

provider in the region.

I hope you will enjoy this publication and thank you for

choosing Eurobank Cyprus as your preferred banking partner.

Michalis Louis

Chief Executive Officer, Eurobank Cyprus Ltd

| 12 | INTERVIEW

FASHION DESIGNERS

WE ARE

STREAMLINING

OUR

PRODUCT

OFFERING,

OUR

PROCESSES

AND OUR IT

SYSTEMS

| 13 |

FOKION KARAVIAS

A New-Generation

Private Banking

Model

CHIEF EXECUTIVE OFFICER, EUROBANK S.A.

We live in risky times.

Over the last 15 years,

the element of uncertainty

has increased

exponentially. The

global financial crisis of 2008 was the greatest

economic downturn since the Great Recession,

almost a century earlier. The outbreak

of COVID-19 was the first declared pandemic

since the Spanish flu of the First World

War and the only simultaneous disruption of

economic activity across the globe and across

sectors on record. And, more recently, Russia’s

invasion of Ukraine has brought back

the spectre of a major military confrontation

in Europe for the first time since World War

II. Too many “once-in-a-lifetime” challenges

are swarming in a short time span.

It is, therefore, not surprising that, currently,

the main feature of markets and the economy

is volatility. A number of economic factors

add uncertainty and suggest that volatility

is not junctural but, rather, a trait of the

‘new normal’ that will stay with us for the

foreseeable future. We have spent the last

decade in an environment of deflation and

negative interest rates in all major economies

and especially in the euro area. Before that,

negative interest rates were largely viewed as a

theoretical possibility or, at best, a temporary

aberration. Now inflation is back and rampant,

at rates not seen since the early ’70s – a

period of economic and financial instability

that is still remembered as a negative model.

And, at the same time, tectonic geopolitical

shifts are having a significant bearing on

international trade, with a major and protracted

disruption of global supply chains and

a nascent trend to repatriate at least a part of

the production base that had moved at the

peak of globalisation.

Against this backdrop, wealth management

becomes an altogether different and greater

challenge. How to protect assets when markets

and valuations oscillate so wildly? How

to identify the best – i.e. the most appropriate

– investment proposals for each client’s

worries and aspirations? How to balance risk

and return? Who to trust and what to avoid?

These are the questions that everyone is asking

at the moment and there are no obvious

answers.

Eurobank has a long record of providing top

service in Private Banking and Wealth Management.

But as priorities change and evolve,

we have decided that it is time to reshuffle

and adapt our model, in order to address the

current challenges and best serve our clients.

We are leveraging technology to achieve this,

introducing cutting-edge digital tools to four

main pillars: upgrading the client experience,

using data-driven processes to both serve and

protect our customers, constantly increasing

client data protection and empowering our

people with the best training and operational

facilities in order to use all their qualities,

knowledge and accumulated experience to

serve the interests of each individual client.

Eurobank is the only Greek bank with a significant

international presence and we offer

Private Banking services from Luxembourg,

London, Greece and Cyprus. We are thus

able to provide our clients with more choices,

more flexibility in their investments, access

to a wide array of products and services, both

our own and third-party, and consequently

the ability to differentiate their portfolios and

efficiently manage risk. This is a unique offering

among our peers and a unique advantage

that we aim to enhance, thus expanding

our business and benefiting our clients.

Our “new gen” Private Banking model is

based on tech-driven, human-centric simplicity

and efficiency. We are streamlining

our product offering, our processes and our

IT systems in order to ensure that each and

every client will enjoy the same, best-of-class

service and overall banking experience irrespective

of the country where they choose to

keep their assets.

We are always there when you need us, for

a transaction, for advice or merely for an

update. But you might just want to make a

move immediately, on your own. Through

our new, upgraded platform, all clients

have unrestricted, real-time access to their

funds. They also benefit from a wide array

of banking services, in only a few easy,

short and secure electronic steps. Unless,

of course, you decide mid-way to give us a

call. Or make a video-call to your trusted

private banker. Or, arrange a visit. The

choice is yours and, irrespective of stream

or location, we aim to provide the same experience,

the same outstanding service for

which you bank with us. You do not even

need to change the banker you have your

relationship with, no matter where you are,

no matter where your assets are kept, no

matter what business you want.

We are truly grateful for your trust. It is

the cornerstone of our relationship and the

reason why, amid the upheaval of the pandemic,

Eurobank Private Banking has been

able to increase its portfolio and expand its

client base. Given the economic landscape,

this is an outstanding achievement and

we owe it wholly to our clients. We feel

we need to pay back. You do not deserve

anything less than the best service available

in Private Banking. This is our aim and

our promise.

| 14 | ADVERTORIAL

PAFILIA PROPERTY DEVELOPERS

Creating World-class

Destinations for Lifestyle

and Investment

Pafilia is the largest privately-owned

residential developer in Cyprus,

dedicated to developing worldclass

properties for personal living

and investment. Uncompromising

in delivering the best in concept,

design, quality and service, we

continue to transform and set the

benchmark for the Cyprus real estate

sector.

Our core development business

is enhanced with a collection of

subsidiary companies, services and

enterprises that cover all aspects of

property ownership and resident

lifestyle needs, including property

management, rentals, resales and

lifestyle concierge. With our dedicated and highly skilled team, we

assist clients with all aspects of relocation covering tasks such as opening

overseas bank accounts, advising on education, healthcare and tax

planning through collaborations with renowned providers.

Our Strengths

• 45 Years Experience

• 7 Global Offices

• 56 International awards received for our commitment to excellence

• 250+ Landmark developments created across Cyprus and Greece

• 360-degree Property related services

Unrivalled landmarks

in prime locations

Pafilia’s comprehensive developments show diversity in locations and

styles, ranging from contemporary houses, Mediterranean villas and

apartments, to integrated leisure resorts, urban towers, seafront properties,

private estates and rare communities.

While our portfolio is diverse, our focus remains on the creation of prime

properties with advanced yet timeless architecture that provide an unparalleled

lifestyle for their residents. To this end, quality is at the core of everything

we do, from concept to construction and from the partnerships we

forge to the ongoing service we provide. Each project is built to the highest

standards and exists as an exemplar of superior living. Exceptional design

is our hallmark, and our in-house design team collaborates with some of

the most respected architectural practices in the world.

| 15 |

OUR FOCUS

REMAINS ON

THE CREATION

OF PRIME

PROPERTIES

WITH

ADVANCED

YET TIMELESS

ARCHITECTURE

THAT

PROVIDE AN

UNPARALLELED

LIFESTYLE FOR

THEIR RESIDENTS

Destination Projects

MINTHIS - Effortless Luxury Living

Minthis is an inspiring hillside community, where every inch is in complete

harmony with its breathtaking surroundings. Perched on a tranquil

hilltop, on a site of 5 million square metres, this Natura 2000 protected

land offers true escapism.

The collection of award-winning luxury residences, villas and suites was

conceived by world-renowned architects, Woods Bagot. With boutique

accommodation, exquisite hospitality services, a championship golf course,

a vast range of onsite experiences, a stunning 12th century monastery and

natural environment to explore, Minthis offers a new way of living to its

residents.

In August this year, we will be launching one of the largest Wellness Spas

in Cyprus with a unique concept that combines modern medicine with

ancient healing methods using local herbs and plants.

In addition, later this year we shall be opening further facilities such as The

Plateia, our social square, consisting of a range of dining and shopping

options, as well as a sports ground with all the outdoor games and facilities

you could wish for. Adding culture into the scenery of Minthis, the 200-

seat amphitheatre will be ready to host diverse events by local and international

artists whereas the art gallery will be hosting prestigious works of

creators from around the world. These world-class facilities together with

the timeless architecture and diverse range of properties give Minthis a

global appeal with many families already calling the resort home.

There are many real estate options at Minthis, the strategy is low-density,

guaranteeing exclusivity and long-term property and rental values. The

Residence collections are bespoke detached homes on large plots whilst

The Ridge and Ridge Green offer 2- and 3-bedroom villas, in private

neighbourhoods, that are ready to move into with prices starting

€1,116,0000.

The Ezousa Suites start from €783,000, they are a unique resort and

investment offering that provide contemporary two-bedroom apartments

and duplexes overlooking the golf course. They include a ‘hassle free’ and

highly attractive investment offer with competitive returns and excellent

benefits for the investor.

ONE - The tallest residential

seafront tower in Europe

ONE is 37 storeys of exceptional seafront living, offering exclusivity and

rarity. ONE offers its international residents an elegant luxury lifestyle with

privacy and discreet freedom. At the same time, it gives the Limassol skyline

a striking new definition that is recognised from anywhere in the city.

At 170m above ground, with 83 luxurious apartments and a maximum of

3 apartments per floor, all properties are exclusive with uninterrupted sea

views and have the benefit of private amenities and services.

The construction journey at ONE is complete and delivery to clients has

begun. The high demand from clients from around the globe has resulted

in only a few remaining units available for sale.

The privacy, the outstanding level of finishes and the attention to detail set

this project apart and make is a unique ONE-of-a-kind investment. Prices

start from €1,950,000.

2022 – A year of

outstanding achievement

This year is a monumental year for Pafilia, with

the opening of new world-class facilities at

Minthis and the completion of ONE. As

the only developer in Cyprus with two

large scale projects at an advanced

stage, our long-term strategy and

commitment to innovation has

enabled us to strive for excellence,

whilst our comprehensive services

provide peace of mind to investors.

Contact us today for more information.

CONTACT

INFORMATION

Address: 33,

Nicodemou Mylona

Street, Paphos, Cyprus

Tel: (+357) 26848800

e-mail:

info@pafilia.com

Website:

www.pafilia.com

| 16 | INTERVIEW

FASHION DESIGNERS

| 17 |

HARIS HAMBAKIS

The Ever-

Changing

Private Banking

Landscape

Haris Hambakis, CEO of Eurobank Private Bank Luxembourg and Head of Eurobank Group Private Banking,

explains how innovation, including New Generation Private Banking, is building on the bank’s long tradition of

providing High Net Worth Individuals and Institutional Clients with a one-stop shop for high-quality services.

How important is the Private Banking function

to Eurobank Group?

Wealth Management has been an integral

part of our philosophy and strategy since the

establishment of the Group and it has consistently

been a central pillar, contributing

significantly to the Group’s results. Over

the years, we have had a solid track record

of successfully growing this business and

effectively establishing our reputation and,

for this reason, we take immense pride in our

Private Banking offering. We have always

strived to become better, stronger and wiser,

especially during the tough times. We have

succeeded not only in surviving the challenges

that have come our way but we have

also emerged from those difficult years most

promisingly.

THE BIGGEST

ADVANTAGE OF

PRIVATE BANKING

IS TO HAVE

A DEDICATED

PERSON OR TEAM

THAT ALREADY

KNOWS YOUR

CIRCUMSTANCES

AND CAN GUIDE

YOU THROUGH

YOUR WEALTH

MANAGEMENT

JOURNEY

IN A PRIVATE,

RESPONSIBLE AND

DISCREET MANNER

For many years, Eurobank Private Banking

has been ranked the top private bank

in Greece and Cyprus by well-respected

international magazines. How did you

manage that?

There is no doubt that awards are a measure

of recognition, respect and continued success.

Not surprisingly, all successful private

banks have certain values in common, which

are distilled in a set of simple practices that

guarantee sustainability, progress and growth;

the pledge to do what’s best for the client no

matter what, the financial knowledge and

well-versed investing experience, the integrity

and accountability of the advisors, the quality

and timeliness of service, the passion and

commitment. Once the foundation is there,

everything else will fall into place, including

good results, awards, acknowledgement and

progress.

What are the core services and products

that Eurobank Private Banking offers?

Private Banking has global access to services

and products that cover a wide range of financial

solutions. Our offering is based on

the concept of a one-stop shop for our clientele,

which consists of both High Net Worth

Individuals (HNWIs) and Institutional

| 18 | INTERVIEW

Clients, offering them banking,

financing and investment services.

Our product base includes

deposit products, notice accounts,

current accounts, term deposits,

fiduciary fixed deposits and various

types of credit facilities and

loans. In relation to the latter,

we offer bespoke financing solutions,

which cover personal needs

(including housing loans), property

acquisitions and investment

loans in Cyprus, Greece and the

UK. On top of the traditional banking products through

Eurobank’s Private Banking, we offer the full spectrum

of investment services of the highest standard. Through

highly experienced Investment Advisors, we offer access

and technical know-how, covering the entire range of

investment products on a global scale, including equities,

bonds, mutual funds, ETFs, alternatives, commodities,

currencies and structured products. The Global Trading

Desk operates during extended trading hours (9:30am-

11:00pm), which facilitates transaction execution in all

the main European, US and Asian markets. Our clients

have the option to select among Execution, Advisory and

Discretionary services. Through Execution services, the

client personally selects each investment instrument and

we facilitate execution through our extensive network of

brokers and asset managers. Through our Advisory services,

our experienced advisors guide clients on tactical asset

allocation as well as on individual security selection, while

our investment strategies take into consideration the

unique characteristics of each client’s investment objectives

and risk appetite. Through our rounded Discretionary

services, we work with clients to establish appropriate

financial targets and suitable levels of risk, which means

that tactical asset allocation, as well as the selection of

investment products/securities to construct the client’s

portfolio, are decided through our specialized subsidiary,

Eurobank Asset Management.

What is the role and function of the modern Private

Banker serving HNWIs? How has this role evolved in

recent years, given the changing needs of this clientele?

The Private Banker is essentially the single point of contact

between clients and the bank and will, at all times,

act as the facilitator who will leverage channels to deliver

services or advice to clients with added convenience. It

is a role that requires a combination of analytical ability,

expertise, diverse and comprehensive market knowledge,

technical competencies, detail orientation, as well as the

OUR AIM IS TO

BECOME THE

STRONGEST PRIVATE

BANKING SERVICE

PROVIDER IN THE

REGION

necessary soft skills. Over the

last few years, the interplay

with clients has transformed

from purely transactional to

relationship-based, and from

selling a product to solving the

ever-changing client needs.

Considering that the development

of new technologies is one

of the most important trends

currently affecting the industry

and given that communications

have shifted to the digital approach,

especially due to the pandemic, the role of the

Private Banker has evolved accordingly in order to match

the new reality and requirements. However, despite this

shift to the digital era of virtual meetings and robo-offerings,

the biggest advantage of Private Banking is to have a

dedicated person or team that already knows your circumstances

and can guide you through your wealth management

journey in a private, responsible and discreet manner.

What is your vision for the future of Eurobank’s Private

Banking function?

We have long provided our clients with dedicated service

and advice. Our offering combines the benefits of being

part of an international financial group with a business

model focused on building strong personal relationships.

Our Private Banking presence in 4 locations (Greece, Cyprus,

Luxembourg and London) connects us under a strategic

umbrella that makes the most of our offered services

and we have been consistently building on this advantage.

To address the new digital era, for the past two years, the Division

has focused on the implementation of our “New Generation”

Private Banking, which aims at business simplification

and the alignment of products, processes and IT systems, thus

ensuring the best experience for our customers. This transformation

project has been deployed and is expected to be

fully operational soon, so as to further enrich our services

in the four locations in which Eurobank Group Private

Banking is present. Shared digital and high-quality experiences

will be offered to all Private Banking customers,

regardless of where they wish to retain their investment funds.

Our dedicated Private Bank in Luxembourg will play a

pivotal role in the new era, since it will enable our clients

to embrace its prestige, expertise and quality of services,

as well as the low country risk it enjoys. By moving to this

new architecture, we trust that we will best manage areas

such as agility, productivity, optimization of operations,

transparency, risk reduction and economies of scale. Our

aim is to become the strongest Private Banking service

provider in the region.

THE

iX

| 20 | INTERVIEW

| 21 |

ANDREAS PETSAS

opportunities

for banks continue

to arise

This is the view of

Andreas Petsas,

Senior General

Manager, Eurobank

Cyprus, who

reveals some of

the Bank’s plans

for the future

while explaining

how Cyprus’

banking sector has

managed to remain

strong and can

continue to do so.

Photo by TASPHO

Has Eurobank Cyprus been

affected by the events in Ukraine?

If yes, what steps have been taken

to cushion the impact?

The events that are taking place in

Ukraine have affected the whole

planet but especially European

countries. The already problematic

supply chain for a number of

products (due to COVID-19)

has been doubly hit, and with

higher costs. As a bank operating in an

importing economy, we could not remain

unaffected. However, the direct impact

on the Bank’s operations, due to Russian/

Ukrainian risk, has been very limited and

no worries have arisen on that front but it

is still being closely monitored. The effects

of this crisis may impact us indirectly

through our local clients and any negative

impact that the crisis may have on them.

These will arise due to the challenges that

the tourism industry is facing, with the

loss of 15-20% of its clientele for this

year, higher energy costs and increases

in the prices of all materials and end

products. These will impact most sectors

and threaten the profitability of many

companies. When profitability suffers,

cash flows become stressed,

repayment ability may be

affected and extra care is

needed by companies and

banks alike to overcome

this threat. At Eurobank

Cyprus, the actions

we are taking in

this challenging

period are

not very

different from

those we took in

the past or any of

those that will be taken

in the future. We stay

close to our clients, we

become more demanding

in requesting reports and

financial information from

them that will indicate the

possible impact on cash flows, and we try

to find the right solutions where feasible.

We encourage our clients to take quick

action on cost-cutting, price adjustments

and marketing direction as rapidly

changing parameters affect profitability

directly and immediately.

What are some of the most significant

challenges facing Cyprus’ wider banking

sector? Alternatively, what are some

of the most lucrative opportunities

available within the local banking industry?

Banks, with the guidance of the regulator,

have adjusted over the years to be

able to deal with various emerging crises.

This is why today we have such a strong

banking sector in Cyprus. Things that

are exogenous, like a pandemic or geopolitical

turbulence, are beyond anybody’s

control, but the

banks still need to

have the cushions to

absorb these shocks

to a great extent. An

all-time challenge for

the banks is determining

the size

and quantity

of resources

employed in

the sector, in

relation to the size

of the economy and

the pace at which

it is growing. The

speed at which the

banks adjust and

simplify processes

and procedures must

be in line with their

technological advancement (digitalisation).

This is an important challenge that

points to the ability to adjust (or retrain)

EUROBANK

CYPRUS WILL

CONTINUE

TO SERVICE

THE CLIENT

BASE THAT IT

HAS ALWAYS

TARGETED AND

CONSTANTLY

SEEK NEW

AND MORE

EFFICIENT

CLIENT SERVICE

CHANNELS

| 22 | INTERVIEW

human resources, otherwise the client service

model is at risk. On the credit risk side,

there is definitely appetite from the sector to

grant new loans, supported especially by the

excess liquidity that all the banks have. But

this comes at a challenging time, due to the

points mentioned before, so careful future

cash flow planning (on the part of borrowers)

needs to be in place so that these assets

(loans) are resilient and remain viable. This,

in conjunction with an expected increase in

interest rates, puts an extra challenge on company

cash flows and subsequently increases

their credit risk (threatening the banks’

balance sheets with new Non-Performing

Exposures – NPEs). On the other hand, an

interest rate increase after many years creates

an opportunity for the banking sector to

move into more profitable results. This will

be achieved based on the extent to which

a correct cash flow analysis has been made

during the lending procedure and it will determine

which of the two forces will prevail

(rising income vs NPE formation). NPEs are

the greatest threat against any bank’s profitability,

especially having the country’s past

experience in mind.

A third important challenge, which also has

to do with the size of the sector and the resources

employed, is the increasing amount

of regulation. This is exerting upward pressure

on the costs of banking institutions and

it is becoming increasingly more difficult to

manage these costs, especially for the small

banks. I believe that the banks that manage

to control their costs and face these challenges

are the ones that will take advantage

of the opportunities. It is crucial, then, to

be in a good position, both operationally

and balance-sheet-wise, in order to exploit

these opportunities. In my opinion, there are

always opportunities in every sector of the

economy, provided that a case/transaction is

correctly structured, has the right amount of

equity by the entrepreneurs and shareholders

and sufficient cash flow. Tourism is – and I

believe will remain – the number one pillar

driving our economy but opportunities for

THE SPEED

AT WHICH

THE BANKS

ADJUST AND

SIMPLIFY

PROCESSES

AND

PROCEDURES

MUST BE IN LINE

WITH THEIR

TECHNOLOGICAL

ADVANCEMENT

(DIGITALISATION)

new clients are arising in a number of energy

projects, hydrocarbon service-related industries,

trade and shipping. Given the continuous

interest shown by foreign investors in

the aforementioned industries, opportunities

for banks continue to arise all the time. A

multifaced opportunity for banks, and one

without limits, stems from the technological

revolution that never decelerates. In the past,

banks were opting for new technology to do

their job better and quicker. Nowadays, the

dynamic has been reversed. Technology, with

the accelerated change and new products that

it brings to the game, is forcing the banks to

speed up, become digitalised, reshape their

models and strategies or stay behind and sink

among high-cost models and structures. Payments

systems, electronic banking, mobile

applications and more are showing the way

forward. More people and companies can

now work remotely and want their banking

to be conducted in the same way, leading

the banks towards a more efficient and lower-cost

model.

Despite the success of Eurobank in the

retail banking sector, Eurobank Cyprus

has not followed this path. Is this situation

permanent or could Eurobank Cyprus also

target retail customers in the future?

From the start, Eurobank Cyprus’s model has

been directed at wholesale banking, which includes

corporate banking, wealth management,

business banking with international companies

and treasury operations. In recent years, we

have added affluent banking – a form of personal

banking that is not offered to mass retail

customers – to our lines of business. We are not

looking at personal retail banking in the form

that the market here has known it in the past,

i.e. with numerous branches, clients standing

in long queues, etc. We believe that any future

personal retail banking must grow through

electronic or digital channels. Tomorrow’s retail

clients are becoming more and more digitally

literate and they do not have the time, the appetite

or the nerve to stand in line in a bank!

What are some of the Eurobank Cyprus’

other development plans for the coming

years?

Eurobank Cyprus will continue to service

the client base that it has always targeted

and constantly seek new and more efficient

client service channels. The Bank is currently

reaching the end of a significant investment in

technology. When this project is completed,

we believe that we will be able to improve our

service, our products and service channels. To

this end, we will continue growing and offering

the best we can to the economy.

The resilience of our economy over the last

few years, the high quality of our business

community, the strong and dynamic workforce

and the influx of foreign investment

has given us over and over again the comfort

of knowing that we can face any economic

challenge that hits us from outside. This,

combined with the operational capabilities of

our Bank, stemming from the high quality

and great efforts our staff, will lead us on a

successful journey, despite any difficulties on

the way.

TOMORROW’S RETAIL CLIENTS ARE BECOMING MORE

AND MORE DIGITALLY LITERATE AND THEY

DO NOT HAVE THE TIME, THE APPETITE OR

THE NERVE TO STAND IN LINE IN A BANK!

| 24 | GLOBAL INVESTMENT ADVISORY DIVISION

Global

investment

Advisory

Division

(gad)

Eurobank’s investment strategy team was founded in 2002. The team was revamped

into its current form in 2010, when the Global Investment Advisory Division (GAD)

was introduced, a cross-asset team which consists of five highly experienced

professionals from the financial sector. GAD is an integral part of Eurobank AM

MFMC and has an active role in the formulation of investment strategies. The team

brings together several decades of combined global market experience in Greece,

the US and the UK, spanning strategy, portfolio management and trading positions in

foreign exchange, fixed income, equity and local currency markets, both in cash and

derivative instruments. The team is also responsible for the cross-asset research

and the definition of the house view on asset allocation. The team’s leadership role

in the asset allocation process goes full circle during the bi-weekly investment

committee meeting attended by the leading specialists of the Eurobank Group from

fixed income and equity investment management, economic and equity research,

structured products, FX desk and fund selection.

Christos Elafros, Head of the Global investment

Advisory Division, discusses the mid-year investment

outlook for 2022 with the team members.

recession. However, a global economic

recession is unlikely to unfold over the

second half of the year, as the monetary

and fiscal stimulus measures delivered

during the period of the pandemic were

significant enough to keep the global

economy afloat even this year. In the

end, persistent inflation and supply

shocks mean that growth will be below

the pre-COVID-19 trend.

Christos Elafros: Let’s start with Michalis

Lambrianos, the Chief Economic

Strategist of the team. It seems that the

global economy is facing some significant

challenges. How do you see the

outlook developing over the course of

the remaining year?

Michalis Lambrianos: After experiencing

one of its fastest paces of growth in 50

years, the global economy is set to slow

down sharply in 2022, as it faces significant

challenges from stagflationary forces.

Although the impact of the pandemic

is waning across most regions, its future

course remains uncertain in China, whose

zero COVID-19 policy is resulting in

regional lockdowns. The supply bottlenecks

initially arising from the pandemic

have now been exacerbated by the Russia-Ukraine

war. As a result, central banks

have made a dramatic shift in their policy,

as their mandate is strictly focused on reining

in inflation. Macroeconomic activity

is slowing and possibly veering toward a

Christos Elafros: The expectation at

the end of last year was that price

pressures would moderate in 2022.

Has this outlook changed?

Michalis Lambrianos: Inflation is

currently running at its highest pace

in over four decades. Moreover, it is

expected to remain high for longer than

the markets and policymakers were expecting.

The main factors shaping the

baseline inflation outlook are the spillover

effects from the high commodity

prices and supply disruptions resulting

from both the war and lockdowns in

China. The duration of these factors

remains unknown and has the potential

to sustain a high level of uncertainty in

inflation forecasting. Complicating matters

is the fact that the stagflation shock

is uneven across regions. In the US, the

energy shock is smaller, as it is no longer

a significant net importer of energy,

labour markets are tight. Wage growth

is rising in an attempt to catch up with

consumer price inflation and, therefore,

cost push inflation is significantly more

prevalent. In the euro area, energy accounts

for the vast bulk of the increase

in the HICP inflation rate since January

2021. The reason is the unhealthy reliance

on the supply of natural gas from

Russia. However, there is no meaningful

second-round effect on wages. Inflation

is much less of a concern for China,

since it has entered a slowdown and is

at risk of a recession. Τhe impact of these

exogenous shocks differs among emerging

economies, depending on whether they are

commodity net exporters or net importers

or net importers.


Christos Elafros: Given the persistent

inflationary pressures, how do you see

monetary policy evolving?

Michalis Lambrianos: The pace of

monetary policy adjustment differs

among the central banks as the inflationary

shock has been unevenly distributed.

Last year, peripheral central banks, especially

those in emerging markets (EM)

where inflationary expectations are generally

not well anchored, were badly affected.

The angst eventually spilled over

into the G10. Developed market central

banks are now hiking. In the US, the Fed

is engaging in one of its most aggressive

tightening cycles since the Greenspan

era. However, it is adopting a gradual

approach. The Fed’s aim is to transition

its policy in order to quell wage growth

pressures without creating undue economic

and market stress and hopes that

price pressures from exogenous factors

will moderate. If supply-driven price

pressures show signs of easing, then the

Fed will ultimately reach a fund rate of

3.25%. If inflation proves to be stickier

than expected, it may possibly raise the

Fed fund rate above 3.50%. Most central

banks share the same concerns, but

the path may differ depending on the

idiosyncratic dynamics of each economy.

There are the exceptions. The ECB is

a notable laggard, Bank of Japan will

remain on hold as wage growth remains

elusive, while the People’s Bank of China

is an outlier as COVID-19 restrictions

have curbed demand.

Wage growth is rising in an attempt

to catch up with consumer price

INFLATION and, therefore,

cost push INFLATION is SIGNIFICANTLY

more prevalent

MICHALIS LAMBRIANOS

Christos Elafros: Let’s continue with

Platon Chaldeos, Chief Investment

Officer of the Group for fixed income,

to discuss the main drivers influencing

bonds. Platon, after a mildly negative

2021 for bonds, we have seen a major

selloff so far for 2022, what are your

thoughts?

Platon Chaldeos: 2022 so far has been a

nightmare year for bonds and the picture

does not look like changing soon. After

exiting the two-year COVID-19 volatility

period, we have entered a new phase

where the consequences of Russia’s invasion

of Ukraine have altered the global

energy map and disrupted the global

grain trade. High inflation continues to

be at the forefront, driven by increased

energy and commodity prices. As the

Fed began raising rates, short term USD bonds were hit

first, not acting as safe havens in this turmoil. All tenors

are suffering with 30yr performance YTD touching a

massive -23.8%, while 10yrs Treasuries are retreating by

-12%. Broad Investment Grade corporates are -12.8%

as of 10/6 with the US high yield outperforming at -9%.

Emerging markets are following with sovereigns dropping

by -15.6% while corporates behaving more defensively

at -11.4%. European bonds are following, with

sovereigns retreating by -12.8% while broad investment

grade euro corporates are down by -12.8%.

Christos Elafros: What is your outlook for fixed income

asset-class overall and sub-asset classes for the

rest of the year?

Platon Chaldeos: While most Fed actions are discounted

and have been driving US rates so far, ECB actions

are now unfolding and ready to offer more pain through

higher euro rates. Nevertheless, there is always the fear

of a policy mistake and that doing too much tightening

might drive the economy into a recession, since this

inflation episode is being driven by supply chain disruptions.

As a result, bonds find themselves in a wedge

between stagflation and the prospects of a hard landing.

A lot is priced in the USD curve as the Fed has been

more vocal managing expectations and the treasury curve

has reacted to that. After the FED delivered a 75 bps in

its June meeting the market is pricing in an additional

200 bps by year end. We view that the longer-term rates,

especially the 10yr trading range, will remain at 3.0%-

3.5%, while the damage done on the short end of the

curve is excessive, rendering the 2-5yrs area attractive.

They are considered a safe pick since their duration risk

is low.

Corporate bond spreads have widened as the higher cost

of borrowing is expected to impact bond issuance and

balance sheets. Currently the impact is being felt to a

greater degree on the higher yielding corporate bond

spectrum. The 10yr Baa USD bond spreads have approached

240 bps from last year’s lows of 160 bps and

are now trading around 200 bps amidst restrained global

issuance. US high yield spreads have propelled to 540

bps from a low of 217 bps last year. We continue to see

very little value in both the high yield and high grade

bonds at these levels as the prospects of a recession is increasingly

becoming a probability.

At the ECB meeting, the termination of the APP programme

was announced, with 25bps tightening in July

to be followed with 50 bps in September. European

periphery, which was the main beneficiary of the PEPP

programme, is now exposed to volatility and higher energy

prices, with spreads widening to their highest levels

in 2 years. It is especially painful on Italy and Greece,

which are among the most indebted economies. Spread

between Greece vs Italy remains steady at 50 bps. Indications

are that the periphery will be hammered unless the

ECB presents a credible bond spread control mechanism.

High energy prices and recession fears have affected

Core eurozone

sovereign yields can

now be a part of our

investment platter, as they

are decisively moving into

positive territory

PLATON CHALDEOS

European corporate and HY spreads. Their YTD underperformance

is mainly due to the core rate moving upwards and secondarily to

widening. Nevertheless, there is room for underperformance in case

economic growth projections falter and equity volatility elevates.


We have been late cycle for

some time now and high

valuations in mega-cap

growth and tech stocks

are now DEFLATING

PEPI TATAKI

Christos Elafros: Let’s move on to Pepi Tataki, the equity specialist of the

team to discuss the developments in equity markets. Pepi, what are the

main characteristics of equity markets so far in 2022?

Pepi Tataki: The markets cannot always be calm and rising. Investors should

expect periods with uncertainty and this year is characterized by a great one. In

the end, during periods of uncertainty and volatility, portfolios can find bigger

investment opportunities. Since March, geopolitics have come to dominate

monetary policy and the hope of containing inflation with a normal, moderate

cycle has vanished. As a result, equities have been drifting lower as negative risks

have risen and sentiment is turning bearish. For now, the global economy is

moving quickly towards a later-cycle phase, as bond rates have already adjusted.

Global PMIs are decelerating as are global consumer confidence measures. Cost

pressures remain an issue for corporates around the world and there are rising

risks to margin expectations for the coming quarters amid sticky input and

labour costs. For the consumer, higher inflation is equivalent to higher taxes.

At the same time, the Federal Reserve has embarked on an aggressive monetary

policy tightening path in an effort to fight inflation and fiscal support will be

limited and more targeted, given the inflationary pressures. Equities will also be

tested by lower liquidity by the Fed, the opposite of what markets have been

used to since the Global Financial Crisis.

Christos Elafros: What is the single most important factor that will dictate

the risk appetite for equities?

Pepi Tataki: No doubt, much will rely on the Fed. Fed members are moving

to a more restrictive stance. Policymakers are aiming to reach the estimated

neutral level as early as possible. At that point, the level of inflation will dictate

how much more tightening is necessary. Until then, the Fed and the markets

will continue to hope that inflation can be brought down without much pain

for employment and for the economic cycle. Therefore, a new bull market may

not return quickly. A peak in inflation and a lower level of inflation volatility

may be needed. Hence, what matters is by how much and how fast inflation

declines, and whether a soft landing can be engineered.

Christos Elafros: Following the significant price correction, do

you think we have reached an attractive entry level for equities?

Pepi Tataki: The length of the correction will be determined by

EPS growth estimates as valuations have already corrected. We have

been late cycle for some time now and high valuations in mega-cap

growth and tech stocks are now deflating. Thus, in terms of PE,

global equities have derated to 15.6 times earnings from 18.5 times

since the beginning of the year but 2022 EPS growth estimates are

still positive, leaving them vulnerable to downgrades. This raises the

risk of another correction if there are significant negative revisions to

H2 earnings projections. Under a more adverse scenario, valuations

offer little protection, as they are still well above levels reached during

recessions, and earnings would likely have a material downside risk

in this scenario. So far, there are no signs of the typical hallmarks of

a recession, such as widespread corporate risk aversion driving cuts

in payrolls and capital spending. Household and corporate balance

sheets remain in relatively good shape, and income and spending are

resilient. However, inflation is proving sticky and the Fed’s forward

guidance is for a rate hiking cycle that has historically ended in recession

more often than not (8 of 11 times or 73%).

Christos Elafros: So, what is your preferred investment strategy

relative to equities for the rest of the year?

Pepi Tataki: There are many moving parts that complicate the H2

outlook: developed economies still reopening after COVID-19, the

employment market in the US is too tight, inflationary pressures

persist, central banks are very hawkish, China is persisting with

its zero-COVID policy and, on top of all this, geopolitical risks

are present, exacerbating the rally in commodities. Predictions

are much more difficult with all these changing risk factors, thus

volatility has moved to higher levels as the market is trying to digest

a very different environment compared to what we were used

to in the past decade. We continue to favour being defensively

positioned in global equities with an underweight exposure. The

current environment still points to a soft landing and, therefore, we

would not eliminate equity exposure, awaiting better entry levels.

At the same time, we believe that opportunities will arise if market

participants start worrying about recession, thus some liquidity

should be present in their portfolios. Finally, the investment horizon

is important for equity investments; an average bull market has

a return of 198%, so adopting a long term strategy will allow the

portfolio to grow.

Christos Elafros: Let’s conclude our mid-year outlook views with

Christos Tsenes, our FX and commodity specialist. Christos, can

you briefly describe the impact of the Russia-Ukraine war on

commodities and energy in particular?

Christos Tsenes: At the beginning of the year, global demand for

commodities was seen as resilient since global growth was showing

signs of strength. Then the war came to raise supply worries and add

further disruptions to the supply chain, raising the cost of raw

materials across the board. Oil and energy prices have skyrocketed

by 50%-130% since the beginning of the year. The reasons

are well-known: trimming – and in some cases zeroing – oil

and natural gas imports from Russia due to sanctions, a limited

willingness by OPEC to sustainably raise production quotas,

increases in selling prices by Saudi Arabia to its Asian customers,

to name just a few. At the same time, more 'green and ESG

friendly' capacity cannot fulfill demands from lost supply from

fossil fuel energy. The Europeans are now seeking new markets

such as the US for natural gas, and Venezuela and Iran for oil.

In an effort to address the issue, the US is tapping its Strategic

Petroleum Reserve. Regardless, the level of supply remains short

of demand and the uncertainty regarding the timing of the energy

market's normalization implies that oil prices will remain

elevated and hover around 110 - 120 $/bbrl. Supply will most

probably remain tight for the coming months, offering no optimism

that prices will fall. We still like oil as a hedge for a portfolio.

Rate hikes by most major and minor central banks and a

loss of consumers’ purchasing power all point to downside risks

to growth. This could drive net demand for oil into negative

territory – hence, oversupply – and some decompression in energy

prices. Still, prices could test higher levels, before ultimately

heading lower at a later stage.

Christos Elafros: Gold traditionally offers protection in this

kind of environment but this time seems to be different.

What are your thoughts?

Christos Tsenes: Gold initially gained ground as the war raised

interest for safe havens. Nevertheless, persistent inflationary

pressures have capped any sustainable upside potential. For the

rest of 2022, the two main drivers for gold valuations remain

the US core rates and the US dollar. The appreciation of the US

dollar and central bank determination to fight inflation continue

to keep the upside potential contained, rendering gold a sub-optimal

hedging instrument. We need to see a step back in market

expectations of upcoming rate hikes for gold to breathe. Overall,

we maintain a neutral stance for gold.

Christos Elafros: Does grain and food inflation play any

role?

Christos Tsenes: The war has had a major effect on agricultural

commodities as the involved parties are amongst the top global

suppliers. Russia is the second largest producer and supplier, behind

China, of ammonia, which is a primary material for fertilizers.

As a result, fertilizer costs have skyrocketed, along with grain

prices. This has led the UN Food and Agriculture World Food

Price Index to all-time highs. Moreover, some Asian countries

are engaged in curbing exports to protect domestic supplies. Add

the war came to raise supply

worries and add further

disruptions to the supply

chain, raising the cost of raw

materials across the board

CHRISTOS TSENES

to the equation the higher frequency of severe weather conditions due

to climate change and one can see why a higher-price equilibrium

may be building up for soft commodities, inspite of the slowdown in

the global economy. We would be buyers of a dip in agricultural prices,

mainly to hedge the rest of the portfolio.

Christos Elafros: We started the year with a long position in the

US dollar. Do you maintain this stance?

Christos Tsenes: Despite the US dollar posing as overvalued across

the board, it has gained significant ground in the first semester of

2022, as it has been the most effective hedging instrument against the

war. With respect to the euro, in the short term, central bank policy

divergence, yield differentials, and/or momentum seem to matter

more as markets keep USD expensiveness in the background. Even at

current levels, the US dollar is expensive against the euro, hence the

euro should appreciate. In the FX world, however, such long-term

misalignments might take quite some time to correct. In this new era,

current levels can no more be characterized as extreme, even as profits

from this hedging instrument are significant. We do not fear EUR/

USD parity but further depreciation looks quite difficult.

| 32 | WEALTH MANAGEMENT

SUSTAINING

FAMILY WEALTH

ACROSS

MULTIPLE

GENERATIONS

By Phryni Yiakoumetti Mina,

Director, Private Wealth Services PwC Cyprus and

Natalie Vassiliou Moustaka,

Senior Manager, S.A. Evangelou And Co LLC,

the PwC Network Legal Practice in Cyprus

In boomers – the wealthiest generation in

the face of elevated uncertainty in economic

and many other areas, and the

drive for growth, businesses must remain

ahead of the curve and effectively plan

for all eventualities. As the so-called baby

history – prepare to pass on a tremendous amount of accumulated

wealth to the next generation, we need to ensure that this happens

in an effective and organised manner.

A fundamental starting point is to have a clear view of the family’s

wealth philosophy. As such, when we are first approached by private

business owners and other High Net Worth Individuals (HN-

WIs) and families, we seek to understand or help them articulate

their aligned wealth philosophy. Arriving at a shared wealth vision

helps create a sense of alignment, commitment and ownership

among all family members. Such discussions need to take place

from time to time, as things evolve. Indicative of changing mindsets

is the fact that, according to the recently launched PwC Family

Office Deals Study of 2022, whilst owning families were more

actively looking to retain and pass on their businesses to the next

generation, the number of disposals during the year underlined

that selling the business – including to other family-owned entities

– is becoming an option for families when it comes to how they

manage their family wealth.

Preparing and planning for the future

Gone are the days when business owners only needed a family

wealth management strategy to map how their property and assets

would be divided after they’re gone. Family wealth planning is so

much more, as it helps business owners prepare for various scenarios,

which is vital in such unprecedented times, and simultaneously

it allows the next generation to preserve and grow the family’s

wealth in the future, including possible disinvestments in traditional

family businesses and investment in new ventures.

As advisors, we work with the family to identify their needs and

concerns as well as their objectives. We prepare contingency plans

for various scenarios which are especially important in times of uncertainty

and socio-political/financial turbulence. We help families

create a solid yet flexible framework for asset protection, succession

planning and wealth restructuring, allowing them to seamlessly

transfer their wealth or business leadership to the next generation.

CREATING A FAMILY WEALTH PLANNING STRATEGY IS A VERY COMPLEX

AND OFTEN SENSITIVE PROCESS. AS SUCH, WE CONSIDER THE

FOLLOWING TO BE IMPERATIVE (THE LIST IS NOT EXHAUSTIVE):

• Wealth management: The landscape in Family Office investments

seems to be changing. The PwC Family Office Deals Study

of 2022 indicates that, whilst in 2020 there was a temporary decline

in transaction volume and value, the value of disclosed family

office deals in 2021 reached record high levels. The study also

shows that there was an increase in club deals. The main drivers

behind the rise of club deals are the increasing size of investments –

meaning that more investors are needed to contribute the required

capital – and the desire to diversify risk exposures. In an uncertain

world, Family Offices are increasingly keen to share the risks and

| 33 |

rewards around their investments. The increase in transaction volumes

and values, along with new ways of investing such as club deals, appears to

be aligned with the overall strategy of families, which focuses on growth.

In the PwC Global Next Gen Survey of 2022, 65% of respondents noted

that growth is a top priority.

• Asset planning and protection: We provide a tax and legal analysis and

help the family comprehend the tax and legal implications of their situation.

We support them in deciding their next steps based on their specific

objectives. Does the family have assets and businesses in multiple jurisdictions?

Where are the family members located? Is an exit plan required?

Is there a need for additional arrangements? Could they benefit from the

creation of more stable structures (i.e. Trust, Foundation, Company Limited

by Guarantee, Fund)? Are there jurisdictions that are more suitable

than others for establishing such structures?

• Planning for the day after: The day after is often too much to think

about. However, with our vast experience and ability to connect, we can

help remove this burden to enable our clients and their families to feel in

control. What plans need to be implemented to deal with these eventualities?

If a plan is already in place, the family may benefit from setting up a

mechanism for its regular revision.

• Leadership succession planning: We encourage families to prepare an

integrated succession plan, which may include preparing the next generation

of family leaders or non-family leaders from early on, long before the

business leader retires and passes on control. The family’s younger members

need to become stewards of the family wealth but, in order to do so,

they need to understand how the family created its wealth and how capital

moves within the systems that were created by the older generations. We

help them become good stewards, even if they decide not to take an active

role in managing the family business and its wealth. Among other things,

we help clients decide which key positions will need to be taken up by

employees outside the family and whether shareholding should be open to

non-family members.

• Philanthropy and impact investing: It is important to have a clear

strategic plan – covering the family, its businesses and the Family Office in

relation to ESG, philanthropy and impact investing, and philanthropic entities

in place – to help the family meet its goals. How can the family give

back to society and become more socially responsible, whilst sustaining its

legacy and achieving its growth targets?

• Technology: We help the family tap into the benefits of technology, by

moving ahead with the digitization and process automation of its family

office/business. How can the family ensure that its affairs are private and

confidential? How can the family share information related to its wealth, in

a timely and transparent manner among members and key associates (e.g.

trustees)?

Family governance

As family circumstances and wealth fundamentals become more complex,

it is important to establish the proper frameworks and processes to facilitate

the discussion of sensitive topics, such as ownership, rights and responsibilities,

information sharing, etc.

GONE ARE THE DAYS WHEN BUSINESS OWNERS ONLY

NEEDED A FAMILY WEALTH MANAGEMENT STRATEGY

TO MAP HOW THEIR PROPERTY AND ASSETS WOULD BE

DIVIDED AFTER THEY’RE GONE

Family governance comes in to help set boundaries, create clarity and facilitate

harmony among family members, even around sensitive topics and,

in parallel, to foster transparency and accountability. It is no exaggeration

to say that when intergenerational wealth transfers fail, this is often the

result of poor trust and communication and can result in catastrophe.

As such, it is imperative that each family carefully weighs its options and

chooses the governance mechanism that is best suited to its needs, opting

for simplicity and flexibility. At the same time, it is important to regularly

consider the strategy’s effectiveness, adjusting when necessary. Examples

include a set of Shared Values or Common Vision, Shareholders’

Agreements and the right Board Constitution for the Family Office/

private structures, conducting family meetings/retreats and establishing

policies for family employment/assessment, etc., but such a list is certainly

not exhaustive.

Cyprus: A preferred jurisdiction

for a second base

Setting up Family Offices has become common practice for family-owned

enterprises in the West, while in recent years it has been becoming increasingly

prominent in other parts of the world.

Just as every family is unique, no Family Office is the same as another.

However, no matter the size of the Family Office, it can evolve into a

powerful wealth planning platform, comprising contingency planning,

succession and estate planning and asset protection with one ultimate goal:

to support the growth and protection of family wealth across different

generations.

Cyprus is an increasingly popular jurisdiction, which can serve as a safe

and stable secondary home for families. Combining excellent education

and healthcare services, a cosmopolitan lifestyle, EU membership, a legal

framework based on the English Common Law system, a strategic location,

reasonable taxation and a wide double tax treaty network, investorand

business-friendly migration rules, it is an ideal secondary base for any

family. Moreover, it offers a wide array of options on succession planning

and asset protection structures (such as the Cyprus International Trust,

Cyprus Funds, Cyprus CLGs), and a high quality of professional services

at competitive rates, compared to other EU jurisdictions.

With more than 40 years of experience in supporting family businesses and

High Net Worth Individuals from around the globe, we understand that

a family’s business and wealth is its legacy. We support HNWIs looking

towards the future by helping them assess risks and eventualities, as well

as truly examining options from various angles, in order to provide them

with the confidence to take the best possible decisions for their family and

business. We bring to the table well-tested global tools and methodologies,

such as PwC’s Family Office Diagnostic Tool and the Wealth Compass,

which are two bespoke tools that we and our clients use as part of their

wealth planning and management.

MARIA KASOLA

Cyprus

macroeconomic

outlook

ECONOMIC ANALYST, ECONOMIC ANALYSIS & FINANCIAL MARKETS RESEARCH, EUROBANK S.A.

After a 5.2% real GDP growth

contraction in 2020, the economy

grew by 5.5% in 2021,

returning to its pre-pandemic

level in 2021Q3, despite the lag

in the recovery of the tourism

sector. Both domestic and external

demand contributed to

the rebound, with the former

benefitting from fiscal support

measures and a successful vaccination rollout and the latter based

on a bounce by professional and financial services. The tourism

sector recovered only partially, compared to pre-pandemic levels,

with arrivals reaching 48.7% and revenues 56.4% of 2019 levels

respectively.

2022 started with a solid economic momentum, as GDP expanded

by 5.6%YoY/1.0%QoQ in 2022Q1, compared to

5.9%YoY/0.7%QoQ in 2021Q4. However, the geopolitical

situation in Ukraine has added uncertainty to the growth outlook.

The economy started with a positive carry-over effect into

2022Q1 yet headwinds are expected in the remainder of the year.

The negative spillover from the Ukraine war is expected to be

primarily transmitted through the external demand channel, given

that Russians account for more than 20% of tourist arrivals in

Cyprus and 20% of the financial services Cyprus provides outside

the EU. In addition, energy and commodity prices, along with

supply chain disruptions, continue to inflate the cost of living

and erode the purchasing power of consumers. In this context,

all major international financial institutions have slashed their

GDP growth forecasts for 2022, as is the case for the entire euro

area. The European Commission (EC), in its Spring economic

forecast released in mid-May, cut the growth projection to 2.3%,

from 4.1% foreseen in the winter forecast in February; more

recently, in early June, the IMF, in the article IV consultation

for 2022, slashed its forecast to 2%, from 3.6% in October. Our

2022 GDP growth baseline scenario aligns with that of the EC,

with evaporated tourist flows from and services exports to Russia

identified as the key drags. By contrast, the expected rebound

of investments, supported by the Recovery and Resilience Facility

(RRF) and the Multiannual Financial Framework (MFF),

comprises a key growth driver. The RRF effect is expected to be

mostly felt from mid-2022 onwards, taking into account the time

needed for some of the projects to mature. The Cypriot Recovery

and Resilience Plan (RRP) provides for a total of €1.2bn, which

breaks down into €1bn in grants and €0.2bn in loans to be deployed

up to 2026, while the funds under the MFF are estimated

at €1bn between 2021 and 2027.

The labour market remained broadly stable in 2021 with the

unemployment rate standing at 7.5% and decreasing to 6.6% in

2022Q1. Yet the slowdown of the economy is expected to cause a

slight spike in 2022, close to 7.7% in our view, given the expected

deceleration of tourism, which is a labour-intensive sector. In

the medium term, the unemployment rate is expected to recede

gradually, returning to its historical long-term trend.

Tourism is crucial to the Cypriot economy. The sector contributed

13.4% to 2019 GDP, resulting in a stellar year in terms

of growth; in 2020, when its contribution diminished to 3.7%,

a 5.2% recession was recorded. The same holds for the labour

CYPRUS ECONOMY

| 35 |

DESPITE THE CHALLENGES, CYPRUS MAINTAINS UNINTERRUPTED

MARKET ACCESS AND INVESTMENT GRADE STATUS

market as well, with jobs related to the said sector accounting for

more than 13% of total employment in both 2019 and 2020. Tourist

arrivals between January and April increased more than tenfold on an

annual basis and doubled compared to the same period in 2020,

when the pandemic had just started to kick in outside China.

The current level of arrivals so far in 2022 is approaching

77% of the 2019 figure, based on April’s data, while in

March the respective figure stood at 70%. All in all,

although the contribution of the Russian market is

significant, this performance is not too dissimilar

from that of competitors. In addition,

April’s data allows for some optimism

regarding the magnitude of the hit and

the speed at which Russian arrivals can be

substituted with those from alternative markets.

Inflation hitting the economy since 2021Q4 is an

equally important consideration. HICP, after a FY-

2021 2.3%YoY increase, spiked to 9.1% in May, from

8.6%YoY in April and 6.2%YoY in March, driven by increases

in energy and food prices. This brought the year-to-May

average rate of change to 6.9% YoY, slightly outpacing

the 6.8% respective figure for the eurozone. High

inflation readings for a prolonged period erode

the purchasing power of disposable incomes

with an adverse impact expected on private

consumption for 2022, when in previous

years, consumption was a main contributor

to GDP.

Before emerging from the

pandemic, Cyprus was rapidly

recovering from the

2012-2013 financial

crisis. Nevertheless,

the latter inherited economic

impediments such

as the high share of NPLs and

excessive indebtedness, both private

and public, which, despite the

progress, still remain not fully resolved.

The pandemic added further pressure to

the public debt, which rose to an all-time

high of 115% of GDP in 2020. Yet the ratio fell

to 103.9% in 2021, with the medium-term trend

posed for a further reduction on the back of expected

GDP growth and a return to fiscal stability. To that end,

fiscal consolidation proceeded much faster than expected in

2021, with the fiscal deficit falling to 1.8% of GDP, from 5.6%

of GDP in 2020, mainly due to strong revenue growth. With the

fiscal adjustment flagged as a key priority on the economic policy

agenda, fiscal deficits in the medium term could continue shrinking

as a percentage of GDP, anticipated at 1.3% in 2022 by the IMF,

and fiscal surpluses or at least balanced budgets could return from

THE

ECONOMY

STARTED WITH

A POSITIVE CARRY

OVER EFFECT INTO

2022, YET HEADWINDS

ARE EXPECTED. FOCUS

ON REFORMS COULD

FURTHER UNLEASH

THE COUNTRY’S

ECONOMIC

GROWTH

POTENTIAL

2023 onwards. Certainly, the adverse geopolitical

momentum could spur fiscal perils stemming from

reduced tax revenues from tourism and professional

services, posing serious downside

risks to the budget execution. However,

they will most probably be mitigated

by the gradual phasing out of the

pandemic support measures,

resulting in reduced public

expenditure. The outlook

for external payments

appears more challenging,

taking into

account that growth is

historically accompanied

by trade deficits, due to the

high reliance on imports of

goods and energy and the deficits

in the income accounts. Specifically,

for 2022, limited income from tourism,

along with the increasing payments for energy

goods, will widen the current account deficit,

from -7.5% of GDP in 2021, to levels close to or

even above 8% in 2022. Last but not least, the further

reduction of non-performing loans (NPLs) remains

a challenge for the banking system, despite past

progress. The NPL ratio stood at 11.1% in

Q42021, down from 15.4% in Q32021

and 17.7% in FY2020, yet it remains

above EA levels. The agreement

of the Starlight project in April,

through which Hellenic Bank

in Cyprus will dispose of

some €1bn of NPLs, could

push the ratio to lower levels,

notwithstanding further pressures

from increased inflation and lower

GDP growth.

Despite the challenges, Cyprus maintains

uninterrupted market access and investment

grade status. As an indication of Cyprus’ actual

economic standing and market participants’ perceptions

of the country’s effort and progress so far, in April

DBRS Morningstar upgraded its sovereign credit rating,

from BBB (low) to BBB, changing the trend from positive

to stable, on the grounds of, inter alia, stronger-than-anticipated

growth and public finances during 2021 and supportive conditions for

debt reduction in the medium term. Having said all the above, geopolitical

upheavals in the Eastern Mediterranean remain a potential source of instability.

However, the potential for growth from the future exploitation of

natural gas reserves also remains. Policy continuity and political stability are

important prerequisites for growth, given that presidential elections will

be held in early 2023.

| 36 | GENERAL MANAGERS

general

managers

Photo by TASPHO

Stephanos

Kassianides

Demetris

Shacallis

Achilleas

Malliotis

Antonis

Antoniou

| 37 |

Stephanos Kassianides

GENERAL MANAGER, INTERNATIONAL BUSINESS

BANKING AND BC NETWORK

International Business Banking caters for the banking

needs of resident and non-resident foreign individuals

and companies whose majority of operations

lie outside Cyprus. We offer the full spectrum

of banking products and services, such as current

accounts, fixed deposits, payment services, debit

and credit cards, credit facilities, treasury products,

trade finance facilities and escrow agency services.

The department’s mandate is to distinguish itself from its peers

through its high quality of service and speed of execution, aiming

to provide an unparalleled customer experience.

The Affluent Banking department provides the full spectrum

of personal banking products and services to clients through

dedicated relationship officers, located in the Banking Centers,

creating a unique customer experience.

Despite witnessing unprecedented times and escalating geopolitical

developments, we look to the future with optimism. In

every crisis there are opportunities and our biggest challenge is

to identify and explore them further. In the last few years, and

especially since the beginning of this year, we have observed

an increase in the number international companies relocating

their operations and staff to Cyprus, signaling a change in the

island’s International Business Industry landscape. We need

to ensure that we continue to offer a personalized customer

service, coupled with a strong digital offering in order to satisfy

the demanding needs of this clientele.

Antonis Antoniou

GENERAL MANAGER,

WEALTH MANAGEMENT & GLOBAL MARKETS

The Wealth Management & Global Markets Division

of Eurobank Cyprus has a long heritage

in the provision of wealth management, private

banking and global markets services, offering

a wide range of investment, treasury, banking and credit

solutions to our High Net Worth and Institutional Clients.

Our philosophy revolves around establishing and

maintaining long-term relationships of trust, combining

our extensive range of solutions with our high-calibre and

experienced personnel.

Responding to changing market needs and keeping up

with the disruptive and fast-moving investment environment

in which we live, our Bank has embarked on a

digital transformation journey. We have invested in a new

Wealth Management technology platform, planned to be

installed within the next few months, and this will enable

our clients to manage their wealth in a more efficient, advanced

and holistic way. In parallel, we continue to provide

our full spectrum of investment services and products

using an open architecture approach and to facilitate trading

in all global markets and financial instruments during

extended trading hours (9:30am-11:00pm).

Achilleas Malliotis

GENERAL MANAGER,

CHIEF OPERATING OFFICER

The role of a Bank’s COO was one of keeping all the

complex structures and operations within the organization

in a seamless functional equilibrium. This role in

Eurobank Cyprus is now changing and is expanding beyond

a pure cost perspective and operational efficiencies to include

the customer experience.

As the scope of activity is widened, the role of the COO of the bank

is facing major challenges against the backdrop of digitalization, regulations

and pressure on profitability.

Comprehensive digitalization is changing established business models

and their organizational structures, as it requires the reorganization

of governance, processes and a new value-added creation structure

without disrupting our operations and upseting our clients.

Guidelines, laws and directives are supposed to make the banking

system safer and help restore lost customer trust. Banks themselves

are overwhelmed by the flood of regulations and compliance is forcing

them to commit a high level of human and financial resources to

implement these regulations.

This requires the development of strategic cost reduction measures

by reorganizing the operating model and eliminating complexity.

As Eurobank Cyprus wants to continue to be successful and innovative

it has decided to align itself in such a way that it can simultaneously

cope with the challenge to be digital, compliant, efficient, agile

and fast in the market.

Demetris Shacallis

GENERAL MANAGER, CFO

The responsibilities of the Finance Division range from

the daily financial analysis and monitoring of the Bank’s

performance to monthly financial reporting to management,

the Board and the shareholder, regulatory reporting,

preparation of budgets and forecasts, tax planning as

well as the preparation of Financial Statements.

In a rapidly changing business environment, the Finance division has

grown in recent years beyond its traditional role, supporting the Management

in decision-making by providing in-depth data analyses and assisting

in forming strategic initiatives.

As the Bank grows, the increasing volume of data poses a big challenge in

processing information using traditional tools. To address this, the Bank

is in the process of implementing a new end-to-end technological infrastructure,

enabling the processing of data in a more timely and efficient

way, further enhancing analysis as a basis for strategic decision-making.

In the face of increased regulation, the Division focuses on keeping up

to date with all regulatory developments, ensuring compliance with all

relevant frameworks, including recent developments on ESG and sustainability

regulatory requirements.

Investing in human capital remains one of the main priorities of the

Bank. The challenge is not only to attract skilled resources but also to

further develop and retain talent. To this end, the Bank aims at establishing

itself as an employer of choice in a workplace where diversity and

inclusion play a key role.

Through the continuous introduction and updating of governance

policies, the Bank maintains a strong level in the area of Corporate Governance.

| 38 | INTERVIEW

| 39 |

SPYROS LOIZOU

Eurobank’s

Five-Year

Digital

Transformation

Roadmap

Spyros Loizou, Chief Information Officer, Eurobank Cyprus, explains

how the bank is transforming to embrace the digital revolution, while

maintaining a high quality of service for its clientele by emphasising

employee skills within a culture of ongoing improvement.

Photo by TASPHO

Eurobank Cyprus already provides an e-banking service to its

customers. In what other ways the Bank has embraced digital

transformation?

Starting with e-banking and digital channels in general is the

obvious first step and the cornerstone of a fundamental digital

transformation but at Eurobank, we believe that digital transformation

is an ‘inside-out’ job. Today the Bank is transforming

its technology footprint from the bottom up to fulfil this strategy. It starts from the

core banking system, including all related back-end systems, all the way to the frontend

digital channels. As such, the Bank is investing in implementing state-of-the-art

software and infrastructure, replacing up to 85% of its current IT topology.

The Bank’s digital transformation strategy is split into three main pillars, which

address a five-year roadmap towards applying technology from the core outwards to

client-facing channels:

Pillar #1: Digital Customer: This pillar focuses on promoting digital channels

as the preferred channel for day-to-day banking across the board, covering all our

clientele. We consider that a strong digital offering, which enables self-service capabilities

to the customer (corporate, affluent, private banking), should take on board

as much transactional activity as possible and streamline back-end operations to the

maximum. The objective is to simplify the back end and shift the focus and energy

of the workforce to more value-add services for our clients.

| 40 | INTERVIEW

Pillar #2: Digital Workforce: The focus here is on enabling employees

to operate in a truly agile manner, not bound to the Bank’s premises but

with the ability to function and service clients from any location through a

laptop or tablet. This means that the relationship manager can visit a client

at their premises or any other convenient place of business, maintaining

the Bank’s Private Banking character by offering truly customer-centric

services. Initiatives under this pillar include 100% mobility, collaboration

tools and education for the digital workforce to increase digital/technology

savviness and much more.

Pillar #3: Lean Banking & Paperless: This pillar of the digital transformation

journey is the basis for enabling a streamlined back-end process,

removing unnecessary complexity and eliminating multiple ways of doing

the same thing. It goes beyond the traditional sense of reducing manual

or paper-based tasks and addresses the concept of end-to-end customer or

employee journeys. This pillar includes initiatives such as the adoption

of digital signatures, end-to-end digital workflows for management or

other approvals, process re-engineering, etc.

Was the digitalization process sped up by COVID-19

and, if so, do you believe that the digital transformation

momentum will continue as we exit the

pandemic?

While every Bank had its own plan of attack

for migrating to digital channels and

kick-starting the digital transformation,

in reality the pandemic was the real

game-changer, especially for Cyprus.

This is because clients were “forced” into this

channel and, in the process, gained confidence

in it. As confidence grew, the easier the task ahead

became and, as more industries migrate their services

to digital means, it is now becoming the new norm. It is

evident that the momentum will continue as we exit the pandemic

and it’s very important to offer digital services which are

secure, robust and available. For Eurobank, cybersecurity is at the

forefront of digital transformation and is now a commodity that clients

expect as a minimum requirement. The pandemic has also given regulators

the opportunity to review the regulation needed to accelerate the banks’

ongoing digital transformation, especially in the area of digital onboarding

and KYC. This momentum is something that Eurobank wants to leverage

as much as possible for promoting a digital-first agenda.

An

ongoing

investment

in people is a

must and is

instrumental

for future

success.

How does Cyprus’ wider banking sector compare to its counterparts

overseas in terms of digital transformation?

In the past 3 to 4 years, Cyprus banks have been investing heavily in their

digital transformation and we have seen change taking place before our

eyes. While traditionally more mature jurisdictions have been ahead of Cyprus

on this journey, we have now reached a point where we have achieved

critical mass: client maturity and trust have significantly been improved

in Cyprus, and not just in banking. This has mandated a change to the

banks’ operational model, where the landscape has changed completely. To

put this into perspective via a very simple metric, in 2013 the country had

more than 1,200 branches of major and smaller banks across the island. As

per the European Statistics Authority at the time, Cyprus held the highest

ratio of branches per 1,000 people across Europe. Less than a decade later,

this statistic has significantly changed, as the combined total is less than 200

bank branches across the country. All the transactional activity that takes

place in branches now is, by and large, fully digital and the offering keeps

growing and improving. This is an important factor for the sector and has

put Cyprus on a par with its overseas competitors.

What are some of the other digital transformation-related aspects of

Eurobank that help it stand out from its competitors?

It’s important to understand that technology on its own its not enough. In

actuality, technology capabilities are already here to do wonders. The real

differentiator is the people. The right people will introduce the right culture

of ongoing improvement and the right culture will mature into smarter

and more efficient working. The key differentiating factors for Eurobank

are precisely these two:

#1 People: It is key to upskill or even re-skill human resources

so as to adopt new technologies and be in a position to make

the most of state-of-the-art software. This starts from

the implementation teams but it also extends to the

users of the technology. So, “tech savviness”, as it

commonly referred to, is vital for the recipients

of new technology as well. Executive Management

needs to understand and assess

the potential gains from smart or newer

technology and, at the same time, users must be

in a position to utilize the full extent of the capabilities

offered. This means that an ongoing investment in

people is a must and is instrumental for future success.

#2 Culture: It’s important to establish a culture of ongoing

improvement. This means that we need to assess often and

empower people to ask, “Can we improve this process?” “Can we

offer this service better?” “What are we doing wrong?” This is a shift in

culture and a mindset to apply critical thinking. A key aspect of nourishing

such a culture is the adoption of an agile methodology and a project-driven

approach that will bring together business and technologists in joint teams.

What is your vision for Eurobank Cyprus’ further digital transformation

over the coming years?

The short-term vision is to mature to a point where the Bank will have a

very limited physical footprint but will be in a position to grow exponentially,

without increasing costs while in the meantime maintaining efficiencies.

The implementation of the Bank’s digital transformation initiative will

be the foundation to move even further ahead. The longer-term challenge

is to be able to offer “Banking-as-a-service” and extend it to the wider ecosystem

for value-added functionally through fintech, government services

and other industries outside banking. As PSD2 and API-based banking

becomes more and more used in the EU, this will be feasible to a much

greater extent and Eurobank will be ready to realize its vision.

CYBERSECURITY IS AT THE FOREFRONT OF DIGITAL

TRANSFORMATION AND IS NOW A COMMODITY

THAT CLIENTS EXPECT AS A MINIMUM REQUIREMENT

| 42 | AFFLUENT BANKING UNIT

| 43 |

POPI HADJIOANNOU

AFFLUENT

Banking:

Dedicated Personal

BANKING Services

HEAD, AFFLUENT BANKING, EUROBANK CYPRUS

Photo by TASPHO

The Affluent Banking Unit provides

personal banking services to the upper

retail segment, that comprises successful

local professionals. Our products

and services include housing loans,

personal credit facilities, deposit accounts,

debit and credit cards as well as

a fully-fledged e-Banking platform. At

the same time, we offer our customers

access to a selection of wealth management

services through a high-calibre

team of experienced financial advisors.

Our clients enjoy the personalized services of a dedicated Affluent

Relationship Officer, who is a highly skilled and trained professional

capable of providing all-round banking solutions. Relationship Officers

are located in our eight Banking Centers

throughout Cyprus and are available to meet

at a time and place that is most convenient

to clients, thus facilitating account opening

and credit procedures. At the same time, the

solutions offered are unique to each individual

client, aiming to satisfy their individual

needs and financial aspirations.

Our aim as a Unit, which is fully aligned

with that of the Bank, is to utilize the opportunities

offered by technology, both in

order to reduce initial on-boarding costs

and, more importantly, to improve the service

we provide to our customers, whether

this is a loan application or an account

opening procedure. At the same time, we

maintain our personal contact and touch,

which are of paramount importance to our

Affluent Banking clientele.

One of the main focuses of the Affluent

Banking Unit is the provision of property loans both for the purchase

of real estate for own use as well as for investment purposes. This includes

the construction or purchase of a primary or holiday residence,

the acquisition of land for the construction of a primary residence

as well as the construction or purchase of a property for investment

purposes. Despite the significant impact of the COVID-19 pandemic

on economic activity last year, the real estate sector showed resilience

and continued to grow, assisted to a great extent by the Government’s

subsidy program. During the pandemic, we supported our customers

who needed financing for the acquisition of their residence as well as

those customers who wanted to take advantage of investment opportunities

that arose.

Following the expiry of the subsidy program and in the aftermath

of the Russia-Ukraine war, the real estate sector continues to grow,

albeit at a slower rate. We continue to support the sector through the

offer of competitive housing loan products.

Our Relationship Officers guide

clients through a step-by-step credit

application procedure, with the aim of

Personal

contact \

and touch

are of

paramount

importance

to our

clientele

facilitating and speeding up this process.

And of course, we support our customers

throughout the life of their loan for any

changes they wish to make.

The Bank has already embarked on its

digital transformation journey with a full

IT renovation programme. The use of

technological upgrades and automation

will improve banking experiences and

back-office efficiency, while account

opening and loan application processes

will be simplified, thus improving our

affluent product offering. The ultimate

goal is to create seamless operations and

exceptional experiences for our clients.

| 44 | INVESTMENT

| 45 |

KONSTANTINOS XANTHIS

Investment

Funds

in Cyprus

HEAD WEALTH MANAGEMENT OPERATIONS, EUROBANK CYPRUS

Photo by TASPHO

Cyprus has been investing for years in building an economy

based on the provision of top-quality services and it

continues to be one of the leading jurisdictions used by

international businesses and High Net Worth Individuals as

a base to manage their investments into Europe and other

markets. In this context, Cyprus has built an advanced and

sophisticated financial services sector and, more specifically, an Investment

Funds sector, which is fully aligned and compliant with the international

standards set by the European Union and other international organizations.

Despite the difficulties of the financial crisis and the challenges

brought about by the COVID-19 pandemic, the Cyprus Investment

Funds sector exhibits a strong momentum, with business and investments

flowing in from many regions of the world, including Europe,

Asia and the Middle East.

There is no doubt that Cyprus is evolving into a strategic European Union

financial centre for setting up investment funds and asset management

companies. In less than a decade, it has managed to become an international

private equity hub, facilitating investment across many industries including

shipping, loan origination, real estate and energy, etc., while also growing as

a centre for wealth management and an ideal family office destination for

High Net Worth Individuals investing in financial assets worldwide.

Eurobank Cyprus has not only followed this trend as Cyprus’ favoured

bank for wealth management and other specialized financial services but has

also invested in and actively pursued the development of the Investment

Fund Services business by establishing its own investment funds (ERB

Funds V.C.I.C. Plc) and has built dedicated teams, systems and relationships

with local and global players to promote and best serve Cyprus-based

investment funds and its ecosystem.

Our Fund Services offering for investment funds includes banking and

global market access for trading, as well as Global Custody/Depositary

and other facilities. The said services are well-designed and priced with a

well-rounded understanding of the Investment Fund market, focusing on

investor protection and soundly facilitating a wide range of fund structures

and complex investment strategies.

We are proud to have become the market leader and key Fund Services Provider

in Cyprus, cooperating with renowned international Fund managers,

as well as the majority of local Fund managers and Fund Administrators,

serving more than 100 licensed Investment Funds with AUMs in excess

of €3.6 billion, which represents more than 45% of Cyprus-based Funds’

asset value.

Our successes and continuous progresses derive mainly from our people,

who are the fundamental element of our organization and who, aside from

their professionalism, comprehensive knowledge of the regulatory framework

and carefully chosen best market practices, exercise a client-centric

approach to providing services. This combination of expertise and a client-centred

perspective is key in helping us foster longstanding professional

relationships, while retaining a competitive advantage over other Fund

Services providers.

Through our upcoming new IT platform, in particular, we will improve

our clients’ experience with the Bank and further automate our operations,

providing quality, efficient, cost-effective and highly competitive services for

the most demanding business and investor needs.

We greatly value our clients’ and associates’ trust and loyalty and we wish

to reiterate our commitment to continuing to work closely together as partners,

to further develop our Fund Services offering, expanding the necessary

facilities and tools to enable them to achieve their objectives in the best

possible way.

It is ultimately through mutually beneficial relationships with our clients

and associates that we aim to continue supporting the growth of our business

and the Investment Fund market in Cyprus.

THE CYPRUS INVESTMENT FUNDS

SECTOR CONTINUES TO EXHIBIT STEADY GROWTH,

WITH BUSINESS AND INVESTMENTS FLOWING

IN FROM MANY REGIONS OF THE WORLD

| 46 | TRUSTS

CYPRUS

INTERNATIONAL

TRUSTS BRING

WEALTH

PROTECTION –

AND REAL PEACE

OF MIND

By Constantinos Ignatiou, Senior Manager,

Client Services, Rebecca Ephgrave,

Assistant Manager, Client Services and

Simona-Maria Ciurla,

Client Relationship Manager,

Trident Trust

Wealth can be slow to grow and, if you

don’t take care of it, quick to shrink.

Protecting wealth is not always easy.

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disputes, business challenges, high

taxation, overspending and much

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Setting up a Trust is a highly effective way for families to make sure

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and efficient succession plans in place.

The other major advantage of a Trust is that it is a highly tax-efficient

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to grow organically.

Fundamentally, a Trust puts protective structures around wealth, managed

by independent Trustees in the family’s best interests. It grows

that wealth and defends it against unfounded claims that can arise from

creditors or family disputes.

With so much at stake, it’s essential to carefully consider the role of the

Trustee. This is an important and, in many cases, long-term relationship,

requiring the highest level of confidence, integrity and professionalism.

Trident Trust has been establishing and administering corporate and

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operating under a Trust. Provision of top-class professional Trustee

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As a highly experienced independent Trustee, we ensure that the wishes

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we do so much more besides.

For example, we can help ensure that wealth remains a private affair,

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are involved, that’s as important for security as it is for privacy.

We can also guarantee that luxury assets are properly insured and protected,

and secure and maintain any property held in the Trust.

Or to put it simply, a well-structured and administered Trust, managed

by an expert specialist Trustee, offers real peace of mind. It means

that your assets are always protected, giving your family one less thing

to worry about. It means the wealth you’ve worked hard for is only

ever used in the way you want.

| 47 |

THE

COLLECTORS

THE

COLLECTORS

For

many

people, the value

of their collections

is not only monetary but

sentimental. Collecting is a hobby

that requires passion, dedication and the

will to overcome challenges. Collectors may

relive their childhood, reconnect with a specific period

or a time they feel strongly about, create continuity between

past and present, or even

By Andria

build a legacy

Tolla

for the generations to

come. Some collect for the thrill of the hunt. All are driven by a quest or

the desire to fulfil a lifelong dream. On the following pages, three businessmen

share their collections, and reveal the story behind their passion, the

challenges they faced, and their ideas for future additions.

Photos by TASPHO And Michalis Kyprianou

| 48 | THE COLLECTORS

A

Unique

Heritage

Photo by TASPHO

The Chief Executive of Pilakoutas Group, Charalambos Pilakoutas, talks about his remarkable

collection of cars and motorcycles, many of which now form part of the unique

Char. Pilakoutas Heritage, reflecting his longstanding ties with the automotive industry.

| 49 |

“I

restored my first car,” recalls Charalambos

have been collecting

miniatures for

years, but as far

as vintage cars

are concerned, it

was back in the

mid ’80s when I

acquired and fully

Pilakoutas. Not surprisingly, he collects

mainly BMW models, due to what he

describes as “a very strong historical bond

with the brand”. That bond dates back to

1958, when Charalambos Pilakoutas Ltd

became the exclusive agent for Cyprus

of the renowned Bavarian automobile

manufacturer.

“The oldest items in my BMW collection

are the distinctive BMW Isetta, which dates

back to 1955, and a BMW classic motorcycle

from 1951,” he notes, but his remarkable

collection of cars and motorcycles includes

vehicles from as far back as the 1920s. “I also

have a car of another brand that was built

in 1924,” he enthuses but, as if to make it

clear that age is not necessarily the key to

a vehicle’s ultimate worth, when asked to

choose his favourite model from the entire

collection, he selects the BMW M6, an

emblematic sport car from the early ‘80s.

While an outsider may reason that it must

be fairly easy for a car dealer to create a

collection of automobiles, Charalambos

Pilakoutas is quick to point out that, no

matter who you are, collecting and restoring

cars is no simple task. He recalls how he

faced a multitude of challenges in the process

of creating and gradually expanding his

collection. “First of all, it was not easy to

buy some of the cars and then came the huge

challenge of restoring them with all their

original features,” he says.

He describes his collecting hobby as “A

process that demands a great deal of time

and requires a lot of attention to detail,”

but it is one that continues to fill him with

excitement. “Every time a car is restored, it is

a thrill to see it transformed into a precious

item belonging to a unique collection, not

only on a local level but on an international

level as well,” he explains.

Pilakoutas’ lifelong dream and vision of

sharing his passion with others and housing

at least a part of his collection became a

reality in 2021 with the official launch of

Every time a car

is restored, it is

a thrill to see it

transformed into

a precious item

belonging

to a unique

collection

The Char. Pilakoutas Heritage, for which he

credits the “collective effort of my colleagues

and their teams who tirelessly, and with

a high degree of professionalism, worked

together to bring it to life.” He describes the

Char. Pilakoutas Heritage as the result of

his dedication to the vision and history of

BMW, and to the values that the Pilakoutas

Group has embraced since 1932 – the year

when his grandfather established his first

garage and showroom – and maintained from

generation to generation.

“Walking around the models, in a captivating

atmospheric environment, is an unparallelled

experience for all car enthusiasts,” he says.

“They can see the past, the present and the

future of one of the world’s most prestigious

automobile brands. And it’s not only a brand

evolution; it’s a whole industry’s evolution in

one place.”

And while the public can enjoy the BMW

part of Charalambos Pilakoutas’ impressive

collection, the man himself continues to

add to the number of special vehicles he

owns. Over the years, he has also started

collecting cars of other brands, with which

the Pilakoutas Group is associated, including

Rolls Royce, MINI, Jaguar, Land Rover,

Nissan and Renault.

There can be no doubt that a passion for

cars is not only in Charalambos Pilakoutas’

DNA but it has been passed down over four

generations of the family and shows no sign

of disappearing.

CHARALAMBOS

PILAKOUTAS

Charalambos Pilakoutas is the Chief Executive Officer

of Pilakoutas Group. Under his leadership, the Group

has grown to become the largest motor trading

corporation in Cyprus. Since March 2004, he has been

the Honorary Consul of Guatemala in Cyprus.

| 50 | THE COLLECTORS

Photo by TASPHO

Sound

Decisions

about a

Sound Museum

Alexey Gubarev, CEO and co-founder of app-maker Palta, has one of the most impressive collections of audio

apparatus in the world. With over 8,000 items valued at around €10 million, he intends to them in a unique

museum. Here, he talks about his passion and the challenges of building such an extraordinary collection.

| 51 |

Halfway through our interview,

Alexey Gubarev shuts the door

to the room. Acoustic foam tiles

are placed on the walls in seemingly

anarchic fashion, while

speakers the size of flat TV screens and turntables

from a bygone era are all around. We occupy

wine-red leather armchairs that have been purposefully

arranged in the middle of the room. He

shuffles through a few LPs. “Most people have

never heard music – not like this,” he says, before

he settles on a record. The needle drops and the

lights turn dim: the turntable is connected to a

set of Avantgarde horn-loaded speakers.

Gubarev’s collection is the history of music itself.

Starting from the early ‘20s, over 8,000 items, including

turntables, speakers, cassette players and

reel-to-reel machines are meticulously stacked

and numbered on shelves in several buildings

along the Limassol seafront. It’s not easy to put

a price on this collection. Indeed, he has spent

more than €10 million over the years but some

of the pieces in his collection are one-of-a-kind,

like the GoldMund Reference turntable, the Micro

Seiki SZ-1 and the Yamaha GF-1 speakers.

“These – well they are invaluable, aren’t they?”

he says. He shows an evident preference for highend

audio systems that were developed between

1950 and 1990, which he equates to the Beatles:

half-a-century later, there’s still nothing better.

Back in the room, the lights are turned on, as

the needle reaches the inner grooves of the vinyl

record. Gubarev gives me a searching look. He

was right: it was like tasting food after quitting

smoking when the sheer volume of flavours takes

you by surprise.

After years of waiting, Gubarev has finally received

approval to build a 5,500 sq.m. museum

in Limassol to house his extraordinary collection

– a first of its kind on the Old Continent. One

of the rooms in the museum will offer the same

treatment that I have just received. “Our vision is

to punch emotion into people, to show how music

can interfere with your personality,” he says.

Gubarev’s passion for collecting audio systems

was ignited nine years ago, when he was 32 years

old. It was a way to satisfy the kid in him, the

one who didn’t have pockets deep enough to buy

such systems when he was growing up. “People

believe that you can make money just like that,”

he says and snaps his fingers. “But I work so

much and so hard every day.”

On arriving in Cyprus in 2002, Alexey Gubarev

founded two companies: XTB Holding, a global

privately-owned hosting network, and Palta, a

co-founding company for health and wellness

startups, which raised €100 million in 2021. “I

had grey hair when I was only 36!” he jokes. The

first sound system he bought was an Onkyo full

system, with Onkyo M-508 amps and after a few

years of random purchases, he started collecting

in a much more organised fashion. He even

created an algorithm that scours the Internet for

items. “I know exactly what I want to collect before

I start buying it,” he says. That has allowed

him to amass some 500 speakers, 600 record

players, an odd 200 reel-to-reel machines and

thousands of amplifiers. Sometimes, depending

on the rarity of the apparatus, he would buy

duplicates. Having collected 99.9% of the items

he wanted, that 0.1% remains unbelievably

elusive, as it rests in the hands of equally compulsive

collectors or museums. “I now try to find

things that are extremely rare,” he says. There

was one particular item he purchased recently,

a Technics SB-9500 speaker system (there are

only three of these systems

in the world), for which he

had been waiting in line for

seven years! There is also

a Technics SB-AFP 1000

flat-panel speaker with the

Vienna Opera that he wants

to get his hands on but there

is a small problem: it is the

only one in the world.

Gubarev often hosts nights

around the turntables in

this very room. Although he has dabbled with

the piano, he admits that he knows enough

to know that he doesn’t know enough. On

the upper floor, where the restoration of the

equipment takes place (there’s also a number of

shelves groaning under the weight of thousands

of cassettes), stands a piano, which, according to

Gubarev, is an exact replica of the one the Beatles

used on recordings of many of their songs. I’m

fairly certain that there are many more hidden

treasures inside this building alone – so many, in

fact, that it would have taken us weeks, maybe

even months, to uncover.

Alexey Gubarev is clearly a fortunate man, and

he is also lucky in a way that many collectors

would envy: “You know, my wife accepts this

hobby,” he says, “because I don’t take it home. I

have only one room there that I listen to music

in. Everything else is here – that’s a good compromise!”

He says this while trying to keep a straight face

but, in the end, he can’t avoid bursting into

laughter, which echoes around his wonderful

listening room.

ALEXEY

GUBAREV

Alexey Gubarev is a founding partner of Palta and

was previously CEO of the XBT Holding group of

companies and founder of Servers.com. For the

past 20 years, he has lived in Cyprus, which he passionately

promotes as a base for IT businesses.

| 52 |

THE COLLECTORS

A

Fabulous

Ride

Photo by michalis kyprianou

Former rally driver Andreas Tsouloftas talks about his career and his impressive car collection.

| 53 |

Andreas Tsouloftas’ passion

for cars started when he was

teenager.

“I learnt to drive when was

16 and, from that moment,

cars became a big part of

my life”, he recalls. After completing his military

service, he went to the UK for studies, where he

obtained his degree in Civil Engineering from

the University of Manchester. On returning

home in 1979 he became involved in rallying.

“At first, as a member of Limassol Automobile

club, I helped in the organisation of various

rallies and then, in 1985, I decided to participate

as a driver. My first rally car was a Fiat Abarth

130 TC which I bought from another driver,

Antonis Michaelides.”

It wasn’t long before Tsouloftas decided to

import his own cars.

“In 1989, I imported a four-wheel drive

Lancia Integrale HF 8V from Italy and in

1991 I bought a works Lancia Integrale 16V

from Greece from the Greek Rally Champion

Giannis ‘Jigger’ Vardinogiannis. This was the

same car that Miki Biasion won the World

Championship Rally of Portugal

with 1989 and ‘Jigger’ won two

Championships in it in Greece.”

The car proved to be a winner for

Andreas Tsouloftas too. He soon started

winning rallies and leading the Cyprus

Rally Championship. In 1993 he moved

to Mitsubishi Motors as the official rally

driver for Mitsubishi, sponsored by

the manufacturers, first in a Mitsubishi

Galant VR4 group A and then a

Mitsubishi EVO 3 group A, an EVO 6

group A and eventually an EVO9 group

N. “I was rallying with Mitsubishi until

2006,” he says, “winning many rallies

and many Cyprus Rally Championships.

I also participated in the Middle East

Rally Championship from 1991 to

2005, winning many trophies and

getting podium results in Jordan, Qatar,

Syria, Dubai, Bahrain and Oman.”

In 2004, thanks to an impressive 7th

overall finishing result in the Cyprus

Rally, which was a World Rally

Championship event, and some good

results in the Middle East and Cyprus

Rally Championships, Tsouloftas was

ranked 54th in the FIA’s Top 100

World Rally Drivers classification.

The Tsouloftas name continues

to make waves: In 2021, his son

Alexandros won both the Greek Rally

Championship 2021 and the Cyprus

International Rally.

“After more than 20 years as a rally driver, I am

very proud to have a successor in the family.

Alexandros, the second of my five children, is

very talented,” he says.

Andreas Tsouloftas’ own passion for cars has not

waned over time. “If I had the proper storage

area, I would have collected a few dozen!” he

confesses, before explaining that, when he built

his own house in 1996, he designed a special

basement area of about 150 sq. m. for his cars.

“Unfortunately, as the family grew, I couldn’t

use that space as planned and I had to convert it

into a play area for the children.”

Nevertheless, he still has an impressive collection

of vehicles, which includes four of his Mitsubishi

rally cars: the Galant VR4 Group A, the EVO 6

Group A, the EVO 7 Group N and the EVO 9

Group N.

“There are three antique cars too: a beautiful

1957 Mercedes Benz 190C soft top/hardtop, a

1963 Morris minor estate and a 1983 Mercedes

190E. Of course, my ‘baby’ is the VW Polo

R5 works rally car, which my son Alexandros is

driving with huge success and in which he has

won most of his rallies.”

There are many other later vehicles in the

Tsouloftas collection, too: a Mercedes S class, a

Mercedes ML320 and an SLC, a Hummer H3,

a Renault Twizy electric car, a BMW i8, a Range

Rover Vogue, a Range Rover HSE Sport, a

Smart and a Dodge Ram (for Alexandros).

The oldest and most valuable is the 1957

Mercedes Benz 190C. “It’s a beautiful antique

sports car, fascinating to drive. I consider it the

‘jewel’ of my collection,” he says with pride.

As a hobby, collecting cars is not without

its problems. The two biggest difficulties

concern the necessary storage area and vehicle

maintenance. “I keep my cars in various places –

closed garages or covered. And you need plenty

of free time to spend on them. Since my time is

very limited, I employ a mechanic who takes care

of cleaning, the engines, keeping the batteries

charged, etc.”

Asked if he has ever thought of sharing his

collection with the public, he replies in the

negative but adds, “I may do so at a later stage.”

And does he consider that his collection is now

complete?

“No! I want to add a high-spec fully electric

car, which cannot be anything other than

a Tesla. I am currently in the process of

getting a new Tesla model Y, which I expect

to have this summer. It is the fastest and the

best electric production car in the world.”

It’s already been a fabulous ride for Andreas

Tsouloftas and he is clearly in no mood to

stop!

If I had the

proper

storage area,

I would have

collected a

few dozen

cars!

ANDREAS

TSOULOFTAS

Andreas Tsouloftas is the Founder and Managing

Director of Tsouloftas Constructions Ltd,

A. Tsouloftas & Sons Ltd, Tsouloftas Group of

Companies and associated Joint Ventures. He

is also the President of the Limassol Chamber

of Commerce and Industry. One of the most

successful Cypriot rally drivers, he enjoyed a

23-year career in motorsport (1985-2008).

| 54 | INTERVIEW

FASHION DESIGNERS

| 55 |

Medochemie:

Where

Dioscorides

Meets El Greco

Dr. Andreas Pittas, Founder and Executive Chairman of Medochemie, discusses

the pharmaceutical company’s tough beginnings, why supporting Cyprus’ capacity for innovative research

should be a societal duty and how his love of art has influenced his career.

Medochemie was founded in 1976, just a

couple of years after the Turkish invasion

of Cyprus. What difficulties did you face

when starting a new business venture in

an industry that didn’t exist, amid the

political turmoil and society still reeling

from the effects of the war?

Times were dark, in every sense of the word. There was real political

turmoil and society was living in fear and pain. The number of refugees

was huge and so was the number of jobless people. However, it

was time to create new things! It is worth mentioning that, after the

invasion, the Turks occupied the Government’s central medicine

depots, creating an absolute scarcity of many essential medicines.

At the time, nearly everybody – especially health professionals –

advised me against the project, as they did not think that ‘Cypriot

medicines’ were a viable enterprise. Here, I have to mention that,

since before the time of Christ, Cyprus had been exporting medicines

to neighbouring countries, among them some copper salts that

were later mentioned by the Greek physician and pharmacologist,

Pedanius Dioscorides and other scientists of the time, as being the

best in the world – they were also used in surgery. So, the word

“difficulty” does not accurately reflect what we faced at the time but

yes, I could tell you many real stories about difficulties!

Some 46 years on, Medochemie is earning some half-a-billion

euros year-on-year, with operations and manufacturing sites all

around the world. Was there moment in time – a collaboration,

an investment, etc. – that was pivotal for the company to graduate

from being a local export champion to one of the top 200

drug companies in the world?

I believe your question exaggerates the figures. If you mean the

turnover, then yes, it is slowly reaching €300 million and our target

for the next 5 years is, indeed, to reach the €0.5 billion mark.

There were a number of factors that contributed to the success: besides

the immense effort and work hours I put into the venture, the

factories outside Cyprus also contributed a lot to our growth.

Medochemie has received every state accolade that exists. Do

these awards, though, reflect government action to help the local

pharmaceutical industry, or is that no longer necessary?

I will first talk about the present: the Government recognizes our

work and the local market accepts more and more of our brands.

However, at the beginning, I would not say that we received any

encouraging comments or tangible support in any way. On the contrary,

at times, we faced hostile and negative attention.

ART HAS ENHANCED A LOT

OF MY CREATIVITY AND

IMAGINATION – FACTORS

THAT YOU NEED BESIDE

KNOWLEDGE, PASSION AND

LOVE TO CREATE NEW AND

CHALLENGING VENTURES

| 56 | INTERVIEW

IN 1976, NEARLY EVERYBODY – ESPECIALLY

HEALTH PROFESSIONALS – ADVISED ME AGAINST

THE PROJECT, AS THEY DID NOT THINK THAT

‘CYPRIOT MEDICINES’ WERE A VIABLE ENTERPRISE

The 2020s have been tough so far for everyone: a pandemic and

a war have led to financial turmoil, broken supply chains and a

collective feeling of uncertainty. Nonetheless, Medochemie has

continued to grow. How did you overcome these challenges?

The way you put this question is absolutely right! Both 2020 and 2021

affected our earnings and how we had to conduct our operations due

to the scarcity of flight connections and a lack of transportation in general,

for both incoming and outgoing goods. However, we did not halt

our new projects – among them a new €15 million building for new

product research and development. We expect to spend a lot more on

innovation and we hope to receive some government support for this

task.

Medochemie is backing the non-profit Cyprus Seeds, which is

the only local accelerator focused on commercialising academic

research. Why did you decide to invest in spinoffs and what policy

change will attract more investors to look at academic research

coming from Cyprus?

I support the important Cyprus Seeds initiative as I strongly believe in

the potential of Cyprus in the broader areas of innovation and research

commercialisation. As the continuing successes of Cyprus in attracting

major European research funds shows, our academic and research institutions

are world-class. Hence, it is our duty as a society to build on

this success and to provide every support possible to the commercialisation

of our capacity for innovative research. My active involvement

with the Cyprus Institute, where I serve as Chair of its Board of Trustees,

addresses this need as a strategic goal for the future of the Institute

and, more broadly, of the Cypriot economy. I support policies that

offer the proper incentives to create and sustain a dynamic local and

regional ecosystem for innovation and research commercialization. Cyprus

Seeds is a key player in this ongoing effort.

The Cyprus Institute, under the aegis of the Cyprus Research and

Educational Foundation, has launched and funded numerous projects

since its establishment. As Chair of the Foundation, does any

single project stand out in terms of moving the needle forward?

I am particularly proud of the Cyprus Institute and of its accomplishments

over the past few years. Our researchers have managed to make

major contributions in all areas of activity ranging from energy, water

management and atmospheric sciences to computational sciences and

science and technology for our cultural heritage. I would especially

mention the impressive growth of the Cyprus Institute in the critical

area of climate change. Clear manifestations of this success are the

establishment of a new centre of excellence (CARE-C), focused on

addressing climate change and air pollution challenges and impacts,

as well as the fact that the Institute is the scientific coordinator of

the Cyprus Government’s Eastern Mediterranean and Middle East

Climate Change Initiative (EMME-CCI). In addition, I should point

out the Institute’s High-Performance Computing facility and its establishment

as the national supercomputing facility of Cyprus. It houses

Cyclone, the fastest open-access supercomputer in the Middle East.

You also seem to have a particular fondness for art. How did that

come about?

Even in my early youth, I was immersed in literature, with a special

love and adoration for Homer. Incidentally, Homer is still on my desk

and I still read The Iliad and The Odyssey on and off. My love of

painting started from our Byzantine routes and was cultivated later in

Austria and Germany, where I studied.

Is there a specific artist, or art form for that matter, that has

shaped the way you approach business decisions?

Your question leads me first to medicine, which contributes to decision-making!

A good knowledgeable health professional must sometimes

take fast decisions. Therefore, that ability to take such decisions,

which our business demands at all times, was already in me. On the

other hand, art has enhanced a lot of my creativity and imagination –

factors that you need beside knowledge, passion and love to create new

and challenging ventures. Since you ask me about a specific artist, I am

a great admirer of the great Cretan painter Dominikos Theotokopoulos

(El Greco). He was 400 years ahead of his time, a prophet of the

impressionism, cubism and even expressionism of the 20th century.

Here, let me highlight the research work of the Cyprus Institute’s Art

Characterization Laboratories, which I support. I am very proud of the

growth of our scientific and technological capacity to study and analyse

the materiality, technique, provenance and, of course, the history and

conservation of works of art and archaeological objects. Indicatively, research

and analysis on works by El Greco, Titian and a range of Byzantine

icons have offered impressive new results featured in international

exhibitions and publications. We are currently collaborating closely

with world-leading researchers and experts from the Louvre and the

Fondation des Sciences du Patrimoine of France to develop innovative

instrumentation for Heritage Science.

OUR TARGET FOR THE

NEXT 5 YEARS IS TO REACH

THE €0.5 BILLION MARK.

INVESTMENT | 57 |

OPPORTUNITIES

BEGINNING

TO ARISE IN A

TOUGH YEAR

By Savvas Theofilou, Partner- Senior Portfolio

Manager, Argus Stockbrokers Ltd

Investors are growing nervous and uncomfortable. Following a

very strong 2021, markets have been hit this year with simultaneous

multiple negatives – war, COVID-19 and a tightening

of monetary policy – but, in the end, it all comes down to

inflation. This is a new and unusual story, with investors feeling

divided about it. There is one camp that sees inflation as

transitory, while the other views it as persistent. Consequently,

the market environment is extremely uncertain and divided in terms of positioning,

causing higher volatility relative to previous years. The S&P 500

recently dropped more than 20% from its highs to hit the technical term of

‘bear market’ intraday but it certainly feels as if it’s been around for a while.

Early last year, we saw some speculative areas like non-profitable tech names

and small caps topping out. Then, last November, other areas of the market

hit a peak and recently mega cap tech names finally broke.

However, a poor market will always lead to new and exceptional opportunities

for investors. Inflation expectations have started declining, there is still

strong employment, and, for now, we have positive estimated growth in

corporate earnings. Traditionally, professional investors with a medium- to

long-term horizon have used this type of correction to gradually increase

their investments further, based on their particular mandate. Furthermore,

bond prices have experienced an epic decline since the start of the year –

one of the biggest in history – bringing several opportunities in the fixed

income space.

The real issue is the Federal Reserve’s change of stance towards the

markets. Both the Fed and the ECB are already behind the curve and

market participants are fearful that central banks will be forced to take

more aggressive measures in order to combat sticky inflation. This is

not an easy task, as they must control inflation without derailing their

respective economies into a recession.

Unsurprisingly, when a central bank is behind the curve, equity and

bond markets have to do its job. Bond markets have priced in multiple

hikes with sovereign and corporate yields blasting higher and bond

prices falling apart in the space of a few months. Moreover, as mentioned

above, specific sectors and non-profitable companies in equity

markets have corrected significantly from their highs and are having a

hard time to find support. Recently, interest rate concerns have transformed

into growth concerns and a stronger narrative for a recession.

If we see economic data weakening, then the odds of rate hikes might

start to slip, and thus can act as a positive factor on risk assets.

It’s a fact that this is a very volatile market for investors and extremely

difficult to navigate. It is important for investors to understand and

have clear picture of their investment strategy/style. They need to

make sure they review their asset allocation periodically with their professional

advisor and be precise about their goals, always based on their

risk/reward profile. It is essential to know and somehow control the

investment limits of each asset class within their portfolio so that they

avoid any surprises. Moreover, it is necessary to understand the portfolio’s

underlying investments and know to which regions, markets or

sectors they are exposed and all the associated risks. When markets are

in a strong downtrend and look oversold, investors are tempted and

try to call a bottom. This is a game that is hard to resist but quite

difficult to succeed at. Investors will be much better off if they stay

patient and stick with their investment strategy.

Lastly, investors need to accept and embrace the fact that markets

go through cycles. They need to maintain a positive mindset during

a period like the present one. As mentioned above, professional investors

with a longer-term horizon usually deploy capital gradually,

when the magnitude of the decline is that strong. Forward valuation

for equity markets is now back in the pre-pandemic range, with estimates

on earnings still going higher. Therefore, with the market well

along in pricing in a recession, wide variations and opportunities

exist across sectors and industries. For example, cyclical industries

tied to consumer goods, technology and housing have sold off massively,

as opposed to defensive industries that have corrected very

little in absolute terms.

Currently, the environment is quite challenging and it’s dominated

by negative nominal and real cash returns. On the other hand, this

is a good time for investors to start searching for solutions that are

alternatives to cash. Fixed income is one area that has started to

become quite attractive. For instance, investors can look into shortterm

global bonds and earn better returns than cash. Nowadays,

investors can easily gain access to tailor-made investment solutions

via institutional professionally managed products that can provide

safe and globally diversified fund structures, geared towards meeting

specific risk tolerance. These can provide highly competitive market

expense ratios and offer potentially better returns relative to cash

over a 3–5 year horizon. Investors just need to be patient and start

looking for some of the great values that are out there.

| 58 | WEALTH MANAGEMENT

A GUIDE TO

FAMILY OFFICE

PLANNING,

GOVERNANCE

AND

SUCCESSION

By Andreas Yiouselli, Director,

Business Process Solutions And Constantinos Yiannikouris,

Senior Manager, Risk Advisory, Deloitte

With the creation of significant

wealth, exciting opportunities

but also challenges can arise for

High Net Worth Individuals

(HNWIs) and their families, as

they acclimatise to its increased

complexities. The recent pandemic

and geopolitical tensions have taught family businesses

many lessons, including crisis prevention, agility and adaptability.

This challenging environment of increasing risk, fraud and

cyberattacks has emphasised the importance of having an effective

governance framework, which is key to staying prepared

for such situations, by building resilience and ensuring the

successful continuity of the business. Aided by advancements

in technology and digital transformation, wealthy families have

become more successful in appropriately committing and allocating

resources, while making a meaningful social impact.

To ensure an effective Family Office governance framework,

important considerations include balanced leadership and delegation,

effective communications, Board oversight, succession

and contingency planning, as well as continuous operational

improvement.

Although Family Offices are often established by a family’s

senior members, effective governance hinges on the experienced

leadership of the senior generation and proper delegation to the

younger generation. While the vision and strategy should be set

by the family, strategic business decisions should be delegated

to the more capable family office personnel and supported by

qualified external advisors. A leading practice among Family

Offices is to establish a Board of Directors to provide oversight

and direction. Careful consideration of the Board’s composition

is imperative and should ideally also include objective external

advisors who can offer contrasting perspectives. The Family

Office often serves as the centrepiece for effective communication

amongst the family. Developing a plan and educating family

members on succession after a senior family member passes

away is an important factor in avoiding disagreements over the

direction of the Family Office, which will ultimately safeguard

their long-term interests. Finally, successful Family Offices

thrive under continuous operational improvement and innovation

as they are constantly faced with evolving challenges.

AS THE BABY BOOMER GENERATION GIVES WAY TO

MILLENNIALS AND GEN ZS, AN UNPRECEDENTED

AMOUNT OF WEALTH WILL FLOW INTO THE HANDS

OF INDIVIDUALS WHOSE EXPECTATIONS ARE NOT

ALIGNED WITH THOSE OF THEIR PREDECESSORS

| 59 |

Challenges in family succession

Potential reasons for failure in family succession include a lack of

guidance, communication and training for the next generation, a

weak governance framework, and the failure to adapt the business

model in accordance with the current external environment. More

importantly, different generations often do not have the same concepts

of business and investment management. So, when it comes to

inheriting a family business, it is hard to reconcile these generational

differences between family members and, therefore, conflicts may

arise which, when compounded by a lack of systematic arrangements

for family succession, can end up fracturing family relations. With

the fast-paced development of the global economy, the concepts

of people born in different generations became widely divergent,

often creating a gap between parents and their children in terms

of culture and values, which can profoundly influence the transfer

of family wealth. The founding generation have a strong sense of

attachment to the business they established and complex emotions

about succession. Parental success can become a burden for the next

generation, as when the successor generation reaches maturity, the

founder generation is often reluctant to hand over responsibility and

decision-making to the next.

Setting an effective governance framework

and helping the next generation

Operating a Family Office is a long-term mission that requires commitment,

prudent planning and support from reliable professionals

who really understand their clients’ needs, build trust and grow

alongside the family. Without open dialogue and communication,

it is impossible to build sufficient trust within a family, let alone

ensure a successful transition. Family Offices can re-establish connections

between generations by seeking to understand each family

member’s individual aspirations, establish common values and goals,

and set out a shared vision for the future of the family and the business.

These rules are necessary to ensure the smooth management

and succession of financial and human capital. These negotiations

will gradually shape the family constitution, which will carry forward

the values of the family into the future. It is of the utmost

importance that all family members support the process and oversee

the creation of effective governance mechanisms. Through their

active participation, every generation of the family can share their

respective values and personal ambitions. In this context, the family

members will assist in coordinating family matters, promoting interaction

and communication, strengthening solidarity, and enabling

these values to be passed down through the generations to come.

Where to next?

Life is full of surprises and families should therefore start planning

early on and adapt as they move towards different stages in their

lives, so that when an unexpected event occurs, its consequences

ALTHOUGH FAMILY OFFICES ARE OFTEN ESTABLISHED BY A

FAMILY’S SENIOR MEMBERS, EFFECTIVE GOVERNANCE HINGES

ON THE EXPERIENCED LEADERSHIP OF THE SENIOR GENERATION

AND PROPER DELEGATION TO THE YOUNGER GENERATION

will not become a family burden. Through the implementation

of effective governance, Family Offices are in a unique position to

address these implications and plan for the inevitable by effectively

allocating and utilising the family assets. The evolution and effectiveness

of a Family Office is secured if its members, the Board of

Directors and their trusted advisors have direct and meaningful

communication. This will allow them to establish stronger business

relationships and a well-structured family governance framework

to ensure the growth of the family business, ultimately ensuring a

sustainable and long-lasting future. As the baby boomer generation

gives way to Millennials and Gen Zs, an unprecedented amount of

wealth will flow into the hands of individuals whose expectations

are not aligned with those of their predecessors. This shift presents

a momentous opportunity for wealth and investment management

professionals to build new relationships and capitalise on the biggest

wealth transfer in history.

ATTRIBUTES OF EFFECTIVE GOVERNANCE

Articulate rights

and responsibilities

of family office

owners,

management, and

board members

Engage skilled

professionals

to support the

family office

Develop a

mission

statement for the

family office

Consider a Board

of Directors with

meaningful external

involvement

Implement

financial and

performance-based

reporting systems to

develop accurate,

timely, and

transparent

information

Establish

succession and

contingency

plans for the

family office

Embrace clear,

regular

communications

with family

members

| 60 | SPECIAL FEATURE

MARIOS CHAILIS

The Future

is Crypto

Libertex Group CMO

Marios Chailis reveals

how, during its 10 years

in Cyprus, Libertex has

drawn on the best that

the island has to offer as

it strives to maintain its

mission for excellence.

He also suggests what

could be done to entice

even more international

companies and investors

to Cyprus, while noting

that the future ‘most

definitely belongs to

crypto’.

| 61 |

The Libertex Group was established in 1997 but Libertex

has had a significant presence in Cyprus for a decade now,

after selecting Limassol as the location of its headquarters.

What are the main reasons why Libertex chose Cyprus as

the base of its activities in Europe?

Cyprus enjoys an ideal location, providing easy access and direct flights to

major financial hubs in the rest of Europe, the Middle East, and beyond.

As you noted, Libertex, a trading platform used by the Cyprus-registered

company Indication Investments Ltd, has been operating in Cyprus since

2012. As part of a global group that draws upon over 25 years of financial

market expertise, we believe that the flourishing cosmopolitan hub of Limassol

is perfect for conducting business and an ideal base from which

we can further expand. The city is home to exceptional local talent

and highly specialized professionals, it has excellent infrastructure,

a great entrepreneurial and growing start-up culture, and all

modern services and amenities. It also offers endless leisure

activities and opportunities for rest and recuperation.

Our professionals based here in the company’s new

state-of-the-art Limassol facilities have the chance

to enjoy a great quality of life and the perfect

work-life balance.

What can Cyprus do to become more attractive

to international companies such

as Libertex and to foreign investors?

Cyprus has already done a great

deal to help foreign investors

and international companies,

with the island now widely perceived

as a great place in which to

establish a business. We are pleased to

see that, in recent years, the country

has invested in and improved

its digital infrastructure, helping

the island fast become an important

tech and start-up hub. Looking to

the future, we believe that Cyprus has the

potential to become even more attractive to

international companies as it paves the way for

technological innovation and advancements – something

which is already being facilitated by the newly-established

Deputy Ministry of Research, Innovation and Digital Policy.

We look forward to seeing exciting new initiatives and further technological

transformation, driven by research, as well as greater investments

in innovative entrepreneurship. This should make Cyprus even more

appealing and competitive, both at a European and international level, as

businesses like ours are given added impetus to grow and prosper.

Cyprus

has the

potential

to become

even more

attractive to

international

companies

How do you envisage the future of the sector and how does Libertex

plan to continue to stay ahead of the pack in the years ahead?

The future most definitely belongs to crypto, as it’s a new era of financial

progress. Libertex is one of the first brokers that has not only implemented

crypto CFDs within its portfolio but also works to constantly improve the

trading conditions involved in using these tradable assets. Utilizing the latest

modern technology is of utmost importance to us, especially merging this

technology with market movements and digital trends. I should also add

that Libertex was recently named Ultimate Fintech’s “Best Crypto CFDs

Broker” for 2022.

In 2020, Libertex became the Official Trading Partner of Premier

League football club Tottenham Hotspur. Do collaborations such

as this make trading more accessible to people who may otherwise

not have considered it?

I would not say that this is about making trading more

accessible to others; it’s more about branding and

awareness. Let’s not forget that football is rightly

considered the king of sports! The visibility

that a sports sponsorship can offer a brand

is hard to beat, especially when it comes

to very popular sport like football. But

more than that, the thrill and excitement

of football can easily be compared to the

thrill and excitement of CFD trading, making

the merger of the two even more meaningful. However,

when looking for a partner in this segment, brokers

should always be able to identify with the values of

the club. For us at Libertex, it was important to work with

a club that has a similar story to ours – a club that started small

but has very big ambitions and hopes and one that wants to grow

in order to make a difference. That’s why we chose Tottenham

Hotspur FC as our partner. Speaking about the exciting world

of trading becoming more visible and accessible today, however,

we shouldn’t forget that there are risks involved with trading

that must always be taken into account.

Have advances in technology made trading more accessible to

more people?

Without a doubt. In the past, complicated trading conditions and the

multiple steps required to complete a trade only made trading possible

for people who had undertaken trading courses and graduated from

trading academies. But today’s modern mobile trading apps and platforms,

as well as the various online learning lessons and guides that are

widely available, make trading more approachable even for novices.

But once again, no matter how confident someone feels about their

trading skills, they should always tread carefully.

As an established brokerage firm, Libertex offers clients around the

world trading CFDs on various underlying assets such Forex, crypto,

stocks, futures, indices and others as well as real stock investments

through its proprietary mobile and online trading platforms. What

are some of the major ways in which the sector has changed over the

years?

The technological ‘revolution’ that allows users to enjoy all banking operations

at their fingertips has undoubtedly affected the fintech industry. All

competitors are striving to make their platforms faster, easier, more intuitive

and more user-friendly. Many new perks and features are constantly

being added to trading apps to keep user interest and excitement going.

Libertex recently signed a Protocol for Cooperation with the Cyprus-based

Hope For Children CRC Policy Center (HFC) which

promotes the human rights of children. How important are initiatives

such as these to Libertex?

We are extremely sensitive when it comes to the well-being and prosperity

of those in need, especially children. We want to create a better

future for our planet and children are that future. The Protocol

for Cooperation that we signed with Hope For Children CRC Policy

Center (HFC) exemplifies the importance that we place on forging a

brighter future by caring for the community, especially with regard to

protecting and helping the younger generation.

| 62 | ARCHITECTURE

form

ollows

unction

What is more important for modern

architecture – functionality or aesthetics?

Can the two always be combined

successfully?

Pavlos Antoniades: This is one of the

most debated questions in architecture!

Form follows Function or Form over

Andreas Eleftheriou and Pavlos Antoniades, Founding Partners

of UDS Architects, talk about their involvement in projects that

have shaped Limassol’s skyline, the cultural influences that

dominate their architectural personas and the challenge of

environmental sustainability.

Photos by Giorgos Charal

Function? Modern architecture practitioners, historians and theorists use

Form Follows Function as the most important principle of the genesis of

modern architecture, which dates back to 1930. Andreas and I share a commitment

to the Form follows Function motto and a love of the architecture

created by the modern architects of Europe and America. The Grand

Masters (Le Corbusier, Gropius, Mies van der Rohe, Frank Lloyd Wright)

created the language of modern architecture, which is based on an organic

| 63 |

marriage between engineering and architecture, between form and function.

This new language was an alternative proposal to the classical language

formulated by the Beaux-Arts school, with its focus on abstract principles of

order, proportion and symmetry.

Andreas Eleftheriou: Form Follows Function implies an honest approach

in the design, the construction method, the materials used and

the function of space. Architectural elevations must express and communicate

the design logic used on the floorplans. For example, on a given

building, the windows’ size and shape should reflect their actual use and

they don’t need to be all the same for purposes of symmetry. Why should

a room be square or rectangle instead of free form and harmonious with

its function? Bruno Zevi, one of the most important architecture critics

of the 20th century, who published The Modern Language of Architecture

in 1965, made Form Follows Function one of the most prominent

subjects in the book, and argued that architecture is a language, which he

attempted to codify by establishing the basic principles.

What aspects of your life before becoming an architect have subsequently

shaped your design principles and style? What inspires your

creations?

A.E.: I used to stutter a lot as a child, so my social interactions were limited!

Instead of socializing, I was reading and sketching all the time. I was obsessed

with how to illustrate our 3D world on a two-dimensional piece of

paper, so by trying to sketch everyday items and buildings in a 3D world,

I discovered the principles of perspective and I was fascinated by Euclidean

Geometry and 3D solids. Back in the ‘80s when I was about 14 years

old, I got my first computer and I spent a lot of time programming in 3D

coordinated systems. It only made sense that I would end up an architect,

using advanced Information Technology visualisations as my basic design

tool. I am still fascinated by the elegance of geometry and mathematics and

how simple rules and the interactions of basic solids and shapes can create

interesting volumes and voids. I believe that these principles are integrated

into my work and I always try to communicate them through my design

proposals, which are based on interactive geometry and mathematics, a

language code and semiotics that I have known well ever since I was a child.

P.A.: As a child I was always very good at subjects such as Physics, Mathematics

and Art and bad at anything that required a good memory! This

natural inclination towards practical subjects made me gravitate towards

pastimes and hobbies in which I could use my skills to create physical

objects, from model airplanes and power boats, which we would race with

friends, to small structures in our neighbourhood’s empty fields. A couple

of years before finishing High School, I met a family friend who was a wellknown

architect in Famagusta, where I was living at the time. His interest

in painting, sculpture, model making – in anything and everything that

had to do with the arts and culture – made such an impression on me that

I decided, there and then, that this was what I wanted to do for the rest

of my life. Studies in London followed, where I was lucky to have the renowned

architect David Chipperfield as a tutor and to also work with him

on architectural competitions. It was during this period that Chipperfield’s

attention to construction detail, to modern forms resulting from the use of

| 64 | ARCHITECTURE

‘Architects, master-planners and engineers must challenge existing

mentalities and discover a new sustainable model with innovation

and progress as common denominators’

- ANDREAS ELEFTHERIOU

We share a commitment to the Form follows Function

motto and a love of the architecture created

by the modern architects of Europe and America

- PAVLOS ANTONIADES

space, its materiality and construction

as a form of art, made a life lasting impression

on the way I view and design

buildings. Apart from the influence that

Chipperfield had on my architectural

approach, I was also affected by the regional

minimalism of Luis Barragan and

the tectonic designs of Tadao Ando.

What major projects have you been

involved in and which single one is

closest to your heart?

A.E.: I was the Project Architect, Architect

of Record and Supervising Architect

of the Limassol Del Mar high-rise

residential project, which was delivered

recently. The design was based on an

original idea and conceptual sketches

by my friend John Dowes (Benoy

Architects) back in 2009! This project

presented enormous challenges – technical,

logistic, financial (during the 2013

Cyprus financial crisis), etc. – and, by

working together with our clients and

our associated consultants, we managed

to overcome the difficulties and

challenges and deliver one of the most

unique buildings in Cyprus which is

also a commercial success. Limassol Del

Mar is the most challenging project that

I have been involved in as an architect

and my team and I learned a lot from

this experience. I was also involved as an

architect in a few high-rise buildings in

Cyprus – private residences, residential

and office buildings – as well as a couple

of hotel developments.

The single one which is closest to my

heart is the project I am designing for

myself: a small residence in the mountains

with an integrated astronomical observatory,

making its architecture as “invisible”

as possible and well-harmonised

with the surrounding environment.

P.A.: I have been involved with my

team in a number of interesting projects,

each for a different reason, over the last

few years. As Lead Design Architect for

the ICON, we had to accommodate

complex requests from the client which

included raised concealed parking floors,

a cantilevered public pool and restaurant

on the 9th floor, a tennis court on the

3rd floor and a private pool on the 20th

floor. An equally interesting project

was the Imperio offices, in which the

client required us to employ advanced

methods of energy-saving for the

building. We designed and proposed a

custom-made shading device that would

also house photovoltaic panels and cover

the whole of the façade. The panels

would be programmed to follow the

sun during the day and not only provide

shade but also produce energy and allow

the façade of building to change during

the day.

What is the greatest challenge involved

in designing for environmental

sustainability?

P.A.: The effects of environmental pollution

and climate change are being felt

around the world and are bringing us

to a critical juncture. The adoption of

important innovative practices for the

development of green and sustainable

buildings is shaping the new era in the

construction industry. However, defining

what is really “green and sustainable”

is a challenge in architectural design. For

example, an energy self-sufficient rural

development is not necessarily defined as

“green” if it results in the deterioration

of the natural environment of the area.

For a building to be green or environmentally

sustainable, it must incorporate

multiple and specific aspects. These

include elements and criteria related to

energy efficiency – energy conservation

or the use of sustainable energy – as well

as the environmental impact of building

materials, the location of the building,

and the overall development effect on

the immediate physical, social or cultural

environment.

A.E.: A green building should clearly

reduce, eliminate or compensate for

any environmental impact through

sustainable design and the construction

method. Green architecture

should focus on factors such as the

building’s life cycle, waste, water use

and energy emissions. Today more

than ever, the damage to the environment

caused by urban sprawl and the

simultaneous shrinkage of the countryside

should serve as a catalyst for a serious

rethinking of current development

models. Architects, master-planners

and engineers must challenge existing

mentalities and discover a new sustainable

model with innovation and progress

as common denominators.

| 65 |

Volunteering

&

Philanthropy

It might be a cliché but it is undeniably true that

philanthropy makes the world a better place. Similarly,

volunteering, which is all about doing unpaid work for

good causes, has a positive impact not only on those

who directly benefit from the assistance they receive

but also on those involved in providing it. Women

have always been big givers, playing a key role in

volunteering and philanthropy around the world, and

Cyprus is no exception. Four Cypriot women involved

in non-profit organizations answer questions about

what they do and explain how a spirit of giving can be

cultivated – especially among children and young people

– no matter how few resources we may have.

Photos

by TASPHO and

Michalis Kyprianou

| 66 | VOLUNTEERING & PHILANTHROPY

Photo by TASPHO

| 67 |

MARY PERDIOU-CHAIR, EUROPA DONNA CYPRUS

A New 20 th

Anniversary

Campaign

Europa Donna Cyprus was founded in 2000 as one of the 47 members of the European organization Europa Donna, all of which share

common goals, including raising breast cancer awareness and improving/expanding breast cancer education. Mary Perdiou, Chair of

Europa Donna Cyprus, tell how her own story was what triggered her to become an advocate for cancer patients’ rights.

What are the main activities of Europa

Donna Cyprus?

Europa Donna Cyprus is an independent

non-profit organization and a member of the

European Breast Cancer Coalition, Europa

Donna. All 47 members of the coalition

works towards raising breast cancer awareness

and generally breast cancer education,

appropriate screening, optimal treatment and

breast cancer patient support.

Why do you enjoy giving to this organization?

I joined in 2004, when I was

diagnosed with breast cancer. After

my first surgery – a mastectomy

– I underwent reconstructive

surgery. When my insurance

company rejected my claim

for the cost of my reconstructive

surgery, Europa Donna Cyprus

immediately sent a letter to the company

explaining that such surgical procedures are

not something that a woman chooses to have

for aesthetic reasons but are a necessity after

breast cancer diagnosis. We finally convinced

the insurance company and, since then, all

such claims are covered by health insurance.

That was when I felt that I, too, should

become an advocate for cancer patients’

rights.

What do you wish everyone knew about

Europa Donna Cyprus?

Everyone should be aware of the following

facts: firstly, that the early detection of

breast cancer saves lives and women treated

in specialist Breast Units have improved

survival rates. Secondly, studies have shown

that a third of all breast cancer cases could

be prevented. Also, there is accumulating

evidence that healthy lifestyle choices can

THERE IS

ACCUMULATING

EVIDENCE

THAT HEALTHY

LIFESTYLE CHOICES

CAN REDUCE

THE RISK

OF BREAST

CANCER

reduce the risk of breast cancer. In fact, the

increasing number of breast cancer cases

may be due to changes in lifestyle habits,

an increase in a sedentary lifestyle, weight

gain and obesity and sociological changes,

such as increasing age at first birth and the

decreasing number of children that women

have. Last but not least, women cannot –

unfortunately – take out an insurance policy

after being diagnosed with cancer, and this

denies them access to financial facilities.

What do you hope to accomplish through

your philanthropy?

I want to advocate for the accreditation

of the existing mammography screening

programme, the accreditation of the

specialist Breast Units and the education of

children and adults about a healthier lifestyle.

Finally, as an organization celebrating its

20th anniversary this year, Europa Donna

Cyprus is launching “The Right to

be Forgotten” campaign to fight

for cancer survivors’ right to

insurance coverage – something

that other European countries have

already initiated through the appropriate

legislation and other measures. This is my

personal mission too.

How do you see women’s philanthropy as

a force for good and change?

I strongly believe that women have a

different way of thinking. Women, at

every stage of their lives and careers, are

committed. Thus, they have managed

to make a major impact on the field of

philanthropy.

How we can develop a spirit of giving, no

matter what level of resources we have?

We should promote a desire to offer to

society among our children, even within our

limited resources and the only convincing

way of doing this is by example.


Photo by michalis kyprianou

ANNA ACHILLEOUDI-PRESIDENT, PASYKAF

Education and

Volunteering

| 69 |

The Cyprus Association of Cancer Patients and Friends (PASYKAF) is a registered, voluntary, non-profit, charitable organization.

For more than 35 years, it has been advocating for and safeguarding the rights and the quality of life for people with cancer and

their relatives. The Association’s Co-Founder and President, Anna Achilleoudi, describes how her own experience with cancer

inspired her to set it up and explains why we need to educate young people about volunteering from an early age.

What are the main activities of PASYKAF?

Our mission is to be a model patient organization, focusing on prevention,

research and education, health policy, patients’ rights and

the provision of professional cancer health services to patients and

their families, from diagnosis onwards. Primarily, however, our aim is

to eliminate cancer, hence we carry out social marketing campaigns to

promote wellbeing, prevent disease, expand access to healthcare and

strive to give everyone an equal chance of living a safe and healthy

life. “Together in prevention, together in life”, as our motto states!

Our services include 24-hour home supportive and palliative care,

psychosocial support on an individual and group level, support for

human loss, physiotherapy and lymphoedema clinics, and transport

of patients to and from the oncology centres in Nicosia and Limassol.

All services and programmes are offered by health professionals and

others, free of charge. Recently, we have been partially integrated

into the NHS.


My personal experience with breast cancer was what motivated me

and some friends to establish the Cyprus Association of Cancer Patients

and Friends in 1986. My own experiences abroad when dealing

with my health issue, together with those in Cyprus arising from my

work as an anaesthesiologist, helped me gain a better perspective on

cancer issues and clarity on how to deal with them. PASYKAF promoted

substantial changes in Cyprus, as regards upgrading cancer

treatment, through the establishment of the Bank of Cyprus Oncology

Centre.

What do you wish everyone knew about PASYKAF?

PASYKAF was established by people who had experienced cancer.

The patients and their relatives knew first-hand all about the needs,

the small joys and the difficulties that exist on the cancer journey.

Hence, all of our programmes and services are based on the holistic

needs of the patients and what is required to improve and maintain

their health and quality of life. In 2021, PASYKAF served the

needs of 6,168 patients through 35,162 meetings and carried out

social marketing campaigns for the prevention and control of cancer

throughout the year. Even in 2020-2021, when the COVID-19 pandemic

overshadowed everything inside and outside hospitals, we continued

to boost public awareness in order to strengthen the primary

and secondary prevention of cancer, which is a permanent pandemic

and a real scourge, one that will continue to exist and affect people

when the current pandemic is over. At the same time, we continued

CANCER WILL CONTINUE

TO EXIST AND AFFECT

PEOPLE WHEN THE CURRENT

PANDEMIC IS OVER

working on issues of equality, patients’ rights and values, identifying

needs and acting as advocates and as a lever of pressure on the

Government to solve the problems. Financial support for PASYKAF

is what enables us to continue and develop our services and programmes,

so contributions, donations, sponsorships and voluntary

support are all welcome.

What do you hope to accomplish through your philanthropy?

Our vision is a cancer-free Cyprus. Until this becomes reality, we will

continue to safeguard the rights and the quality of life of people with

cancer, balancing their immediate needs and priorities with long-term

goals.

How do you see women’s philanthropy as a force for good and

change?

We are going through difficult times and, in the absence of solidarity,

this situation will only worsen. There is a need for change. We have

to establish new structures as regards the promotion of health in children,

adults and the elderly. Women have always been able to organize

and effectively strengthen every cause in which they participate.

Women who want to make a difference can improve their world in

many ways. Through business networks, women can create mechanisms

to raise funds and enable social change and a culture of health

and well-being.

How we can develop a spirit of giving, no matter what level of

resources we have?

Giving can be done in many ways, without being limited to financial

assistance alone. Social changes can also be achieved by those who have

access to key people. At the same time, however, it is important to invest

in the education of our children. We need to inspire children about the

value of charity and make them feel joy when they give to others. This

will help them evolve into people with values, respect, critical thinking

and other qualities, who will become part of a society of solidarity.


Photo by TASPHO

MYRIA STAVRAKI

VICE-PRESIDENT, CYPRUS ANTI-CANCER SOCIETY

Offering

an

Emotional

Embrace

| 71 |

The Cyprus Anti-Cancer Society was established more than 50 years ago to care for people with cancer, to provide complete

palliative care, to support patients’ families and caregivers, and to inform the wider public about cancer prevention, diagnosis,

treatment and relief. Myria Stavraki, Vice-President of the Association, tells how her own battle with cancer made her realize

that patients need a strong embrace and understand the benefit of palliative care to all chronic patients.

What are the main activities of the Cyprus Anti-Cancer Society?

The Cyprus Anti-Cancer Society provides comprehensive services through

a large team of health professionals, which include the operation of the

Arodafnousa Palliative Care Centre in Nicosia and the Evagorio Palliative

Day Care Centre in Limassol, homecare nursing services for patients

throughout Cyprus, psychological, social and spiritual support for patients

and their families, physiotherapy and treatment of lymphoedema, aromatherapy

and patient transfer services from all districts to oncology centres in

Nicosia and Limassol.


Being a cancer survivor myself, I realized that cancer patients

need a strong embrace. By that, I don’t mean a literal

hug but they do need care, support and comfort throughout

their illness. My greatest wish was to be able to give

this emotional hug to others and, through my involvement

in the Cyprus Anti-Cancer Society, I became part of this

wonderful family. I feel lucky to be able to work with so

many other volunteers in order to support the crucial services

provided by the Society to thousands of patients all

over Cyprus.

What do you wish everyone knew about the Association?

It is important to communicate that palliative care is

beneficial to all chronic patients throughout their illness.

It is a multidisciplinary approach that improves

the quality of life of patients and helps them get through

a very difficult period with dignity. It prevents and relieves

suffering, whether physical, psychological, social

or spiritual. Palliative care is also helpful for the patient’s family or

caregivers, as it alleviates some of the stress and adds to their own quality

of life. The Cyprus Anti-Cancer Society has been offering free palliative

care services to cancer patients in our country for many decades

without any discrimination. Over the years, it has grown and its services

have expanded tremendously. Today, we are the only non-profit

organization in Cyprus providing comprehensive palliative care services

and a large national homecare nursing service (nurses, psychologists,

social workers and physiotherapists visit and care for patients

and their families in their home or place of residence). Every year, the

If we care

about

something,

that

becomes

our

passion

and then

we become

the best

advocates

for that

cause

Society treats around 4,000 patients and many more family members

and caregivers.

What do you hope to accomplish through your philanthropy?

My personal involvement in charity made me wish to pass on the feeling

of caring to everyone around me and, ideally, one by one we can multiply

the idea of contributing to our community and establish a culture

of caring people. I believe that it is important for us to care about something

– patients, children, education, animals, the environment, etc. It

doesn’t matter what that something is. What is important

is that we nurture people who care. If we care about something,

that becomes our passion and then we become

the best advocates for that cause and can move things

forward in order to bring change and improvement. In

my opinion, this is the only way to make the world a

better place.

How do you see women’s philanthropy as a force

for good and change?

I don’t think that gender defines philanthropy. As long

as a person has empathy and shows kindness, they can

work towards making the world a better place. This is,

however, a group effort that needs a lot of work and

strength from everyone.

How we can develop a spirit of giving, no matter what

level of resources we have?

Our children are the key. During the nurturing and

development of our children, we need to push them towards

charity, to walk the path of giving and caring for

those who need help. First, it is important to let them choose a cause

they feel passionate about and then teach them that helping does not

only mean donating money or goods but it can also be about volunteering,

dedicating time and effort to an activity that will help that

specific cause. Volunteerism teaches children about community effort,

gives them confidence and offers satisfaction in the knowledge that

they can make a difference. Our children need to be taught by example.

By involving them in activities that have a purpose, we let them

experience the benefit of helping and make them understand the value

of helping others. This will inspire them to want to do more.


Photo by TASPHO

DR. POPI KANARI - PRESIDENT, KARAISKAKIO FOUNDATION

Making

a Positive

Difference

| 73 |

The Karaiskakio Foundation is a non-profit organization, founded in 1995 in memory of 5-year-old leukaemia patient Andreas Karaiskakis with the

initial purpose of establishing a public bone marrow donor registry in Cyprus. Today, with more than 200,000 registered volunteers, it holds the record

as the largest per capita bone marrow donor registry in the world. Dr. Popi Kanari, President of the Foundation, has been a volunteer with it for more

than 20 years. Here, she explains how philanthropy can address the root causes of systemic issues to make a positive difference.

What are the main activities of the Karaiskakio

Foundation?

With its stated mission to “serve the unmet

needs of vulnerable and underserved groups

of patients through innovative scientific and

social interventions,” the Foundation has organized

a network of specialized laboratories

to support patients with leukaemia, cancer,

and rare genetic disorders. The laboratories

are among the most advanced in Europe and

they provide nearly 10,000 specialized laboratory

tests per year for patients with haematological

malignancies, young cancer patients,

adults with brain, colon, lung, breast and

other cancers, children with rare genetic syndromes,

families with cancer predisposition

and many others. The Childhood Diagnostic

and Research Unit enables doctors to implement

targeted treatments, thereby improving

survival rates and minimizing collateral damage

from therapies. The Karaiskakio Foundation

also focuses on rare genetic disorders and

has diagnosed 150 genetic diseases, which

had previously not been identified through

conventional methods.


Cancer science is challenging and certain

areas, like childhood cancer and rare diseases

with predisposition for cancer, are still

understudied. To work with scientists in

this challenging area to provide solutions to

oncologists to save lives is more than I could

ask for, in terms of personal satisfaction. I have

enjoyed giving to Karaiskakio since 1999 as

a volunteer and I still do. By volunteering to

help achieve the Foundation’s vision and mission

and supporting its research, the cause for

which I am working becomes more personal

and real. This broadens my perspective, sharpens

my empathy, fuels my passion to make a

positive impact on society and puts my humanitarian

principles into scientific action.

What do you wish everyone knew about

the Foundation?

Many people still think that the sole

aim of the Karaiskakio Foundation

is to find a matching donor

from its Bone Marrow Registry

and save a life. This

was, of course, the prime

reason for its establishment but

over the years it has expanded and

tailored its activities to create value

to the health system in Cyprus and to

society at large. The Foundation uses its

philanthropic resources to their maximum

potential and has set and achieved goals, with

the support of volunteers and great sponsors,

to ensure the best possible outcome.

What do you hope to accomplish through

your philanthropy?

Philanthropy means “love for humankind”

and, unlike charity, it is a strategic process,

that tries to address the root causes of systemic

issues with the aim of making a positive

difference to the cause you serve. For me,

philanthropy means freely giving my time,

skills and knowledge and working together

with the staff, Board members, and other volunteers

and partners, to have a positive impact

on the lives of patients in need and on broader

society.

How do you see women’s philanthropy as a

force for good and change?

Women who are involved in philanthropy

can demonstrate powerful leadership by

making the world a better and more equitable

place. They can be role models for

their families, their colleagues and society,

inspiring others and especially the younger

generation. Through altruistic actions and by

sharing values and integrity in a collaborative

manner, women can help make society more

inclusive, prosperous and caring. Translating

WOMEN

WHO ARE

INVOLVED IN

PHILANTHROPY

CAN DEMONSTRATE

POWERFUL

LEADERSHIP BY

MAKING THE

WORLD A BETTER

AND MORE

EQUITABLE

PLACE

humanitarian principles into action can be

a life-changing learning process for all those

around them.

How we can develop a spirit of giving, no

matter what level of resources we have?

The most effective social impact is driven

by motivated, knowledgeable and passionate

people. The motivation for giving

should start from an early age. The Karaiskakio

Foundation has volunteers who

go to schools and talk about volunteering.

Once a year, we honour the donors who

have given their bone marrow. They do not

know the identity of each recipient but they

feel blessed to have saved a life. This is the art

of giving and expecting nothing in return.

Having young girls donate their cut hair to

the Foundation, which sends it off to be used

in wigs for children with cancer, is cultivating

the spirit of altruism at a young age. It

is a noble cause that does not require great

resources but the end result is so precious to

those in need.

| 74 | TAX PLANNING

CYPRUS AND

HIGH NET

WORTH

INDIVIDUALS

By Valentinos G. Pavlides, Senior Manager,

Tax Services – Transfer Pricing Services,

Baker Tilly South East Europe

In today’s fast-changing world, marked by high levels

of conformity and changing tax obligations, tax

planning for High Net Worth Individuals (HN-

WIs) has become a hot service. Numerous jurisdictions

around the world are competing intensely to

attract these individuals and their businesses.

Cautious tax planning always matters but when an

individual has a high net worth, doing everything right can be

even more critical. By employing tax strategies for high-income

earners, HNWIs can preserve more of their earnings and wealth

over time. The World Wealth Report defines HNWIs as those

who hold at least US$1 million in assets, excluding their primary

residence, and ultra-HNWIs as those who hold at least

US$30 million in assets, excluding their primary residence.

FINANCIAL PROFESSIONALS AND ADVISORS CLASSIFY HNWIS

INTO 3 MAIN CATEGORIES:

• High Net Worth Individuals (HNWIs): People or households

with liquid assets valued between $1 million and $5

million.

• Very High Net Worth Individuals (VHNWIs): People or

households with liquid assets valued between $5 million and

$30 million.

• Ultra High Net Worth Individuals (UHNWIs): People or

households with more than $30 million in liquid assets.

Cyprus has traditionally been an attractive jurisdiction for

HNWIs, offering both financial and non-financial advantages

as a place to live, invest in or invest through, and as a base for

their international business.

The island’s privileged geographical location is the main reason

for its significance as an important trade route and shipping

centre through the ages.

Cyprus has customarily offered alluring tax incentive schemes

that allow HNWIs to maximize their net return on their

investments and worldwide income. Individuals relocating

to Cyprus and becoming tax residents of Cyprus can enjoy

tax free status on dividends and on capital gains and interest

income from their foreign and local investments through their

non-domiciled tax status.

The main benefits and key aspects of becoming a tax resident

of Cyprus are summarized below.

Tax Residency

AN INDIVIDUAL WHO SPENDS MORE THAN 183 DAYS IN CYPRUS IN

ANY GIVEN YEAR IS A TAX RESIDENT OF CYPRUS. AN INDIVIDUAL CAN

BE TAX RESIDENT IN CYPRUS EVEN IF HE/SHE SPENDS LESS THAN 183

DAYS IN CYPRUS, PROVIDED HE/SHE SATISFIES ALL OF THE FOLLOWING

CONDITIONS WITHIN THE SAME TAX YEAR:

| 75 |

JURISDICTIONS AROUND THE WORLD ARE COMPETING INTENSELY TO ATTRACT HNWIS AND THEIR BUSINESSES

• does not spend more than 183 days in any other country;

• is not a tax resident of any other country;

• spends at least 60 days in Cyprus;

• maintains a permanent home in Cyprus that is either rented

or owned;

• carries on a business in Cyprus and/or is employed in Cyprus

and/or holds an office with a Cyprus tax resident company at any

timeduring the year

No tax on dividend and interest income

A non-domiciled individual, irrespective of his/her tax residency status

is exempt from tax on dividend and interest income (such income

is subject to contributions to the National Health Scheme (NHS) at

the rate of 2.65%).

No tax on gains arising from the disposal

of investments

Any gains arising from the disposal of shares, bonds and other similar

financial instruments (including options and rights thereon) are exempt

from tax (such income – of trading nature only – is subject to

contributions to the NHS at the rate of 2.65%).

Exemptions to income tax (employment income)

An expatriate individual (regardless of his/her tax residency or domicile

status) who relocates to Cyprus to take up employment, and was

not a tax resident in Cyprus before the commencement of employment

in Cyprus, is entitled to a 50% or 20% exemption on employment

income earned.

Income tax exemption for overseas employment

The rendering of salaried services outside Cyprus to a non-Cyprus

tax resident employer or to an overseas permanent establishment of a

Cyprus tax resident employer for more than 90 days in a tax year, is

exempt from income tax.

Digital Nomad Visa Scheme

The Cyprus Digital Nomad Visa Scheme allows third-country nationals

who can perform their work remotely to reside temporarily

with their families in Cyprus and at the same time work for an employer

registered abroad (in case of an employee) or perform work

for companies or clients located abroad (in case of a self-employed

individual). Individuals who are granted a Digital Nomad residence

permit will have the right of residence in Cyprus for 1 year, with a

possibility of renewal for a further 2 years. Furthermore, the individual’s

family members can also obtain a residence permit in Cyprus

for the same duration as the holder of the Digital Nomad Visa. However,

they may not be employed or perform any economic activity in

Cyprus.

Nil/ Reduced withholding tax on income received from abroad

Cyprus has more than 65 double tax treaties that provide for nil or reduced

withholding tax rates on dividends, interest, royalties and pensions

received from abroad.

Lump sums received as a retirement gratuity are exempt from tax.

In addition, a Cypriot tax resident receiving pension income from

abroad may choose to be taxed at a flat rate of 5% on amounts exceeding

€3,420 per year.

Estate duty, wealth tax, gift tax and inheritance tax

There is no estate duty, wealth tax, gift tax or inheritance tax in Cyprus.

Corporate taxation

ON THE CORPORATE LEVEL, SETTING UP BUSINESS IN CYPRUS OFFERS

THE BENEFIT OF CAPITALIZING ON THE DIFFERENT BENEFICIAL EU

DIRECTIVES AND THE VARIOUS PROVISIONS OF CORPORATE INCOME TAX

LEGISLATION WHICH CATERS FOR:

• 12.5% income tax on corporate trading profits

• 0% corporate tax on sale of securities

• No withholding tax on outgoing payments (dividends, interest,

royalties)

• Dividend income is generally 0% on foreign exchanges profits

(losses not deductible). Advance tax rulings are possible

• Favourable tax regime for intangible property

Tax planning and transparency

Cyprus is compliant with all international standards and requirements

on exchange of information and thus individuals can rest

assured that becoming tax residents of Cyprus will benefit them both

financially and business-wise.

Tax planning is not a once-a-year activity. It occurs in real time and

year-round and, consequently, HNWIs should have this in mind

when deciding on their next moves.

| 76 | BUSINESS TALK

war and

| 77 |

peace

The

pandemic may have retreated but now the war

in Ukraine has sent prices skyrocketing and brought

uncertainty to the business community on the island.

A need for answers and concrete proposals aimed

at helping the economy recover led us to send out

invitations to Finance Minister Constantinos Petrides

and 11 local business leaders to discuss today’s key

issues. Here’s what happened. Photos by Taspho


Eleni Kaloyirou

George Chrysochos

Constantinos Petrides

over the next decade, how Cypriot entrepreneurship

has developed in recent

years and what the current challenges

facing local businesses are.

We had been warned. The week was going

to be dominated by sizzling temperatures,

occasionally interrupted by storms:

a fitting reflection of the current global

environment. Gathering at the cosy

Beba restaurant in the heart of Nicosia,

we were ready to hear what our guests

had to say about the war in Ukraine and

its impact on the rest of the world, how

sustainable economic growth can be

achieved, what the Government needs

to do to attract more foreign investment

WAR IN UKRAINE

IMH CEO George Michail opened the

proceedings by inviting the Minister of

Finance to share his thoughts about the

current state of the economy, in light of

the ongoing war in Ukraine.

“Admittedly, first the pandemic and now

the war in Ukraine have had an impact

on the growth prospects of the Cyprus

economy, at least in the short term,” said

Constantinos Petrides. “However, we

don’t expect it to last; the tourism sector,

for example, which had been significantly

affected over the last two years, is

already performing better than initially

| 79 |

“THE CHALLENGE IS NOT

JUST ABOUT ENCOURAGING

ENTREPRENEURSHIP. IT IS ABOUT

SUPPORTING IT WITH SUITABLE

FINANCIAL STRUCTURES AND

LINKING ENTREPRENEURS WITH

THE ACADEMIC WORLD AND THE

PUBLIC SECTOR”

DESPINA PANAYIOTOU THEODOSIOU

WHO’S

WHO

CONSTANTINOS PETRIDES

(MINISTER OF FINANCE)

CHRISTOS V. VASILIOU

(MANAGING DIRECTOR, KPMG CYPRUS)

ANDREAS PETSAS

(SENIOR GENERAL MANAGER,

EUROBANK CYPRUS)

“IN THE COMING YEARS, GROWTH

WILL COME MAINLY FROM

INVESTMENT IN SUSTAINABILITY

AND TECHNOLOGY”

STAVROS PANTZARIS

CHRISTOFOROS HADJIKYPRIANOU

(CEO AND PRESIDENT OF THE COUNCIL,

EUROPEAN UNIVERSITY CYPRUS)

ELENI KALOYIROU

(CEO, HERMES AIRPORTS)

STAVROS PANTZARIS

(CHAIRMAN, EY CYPRUS)

PIERIS MARKOU

(CEO, DELOITTE CYPRUS)

DESPINA PANAYIOTOU THEODOSIOU

(JOINT CEO, TOTOTHEO MARITIME,

PRESIDENT, WISTA INTERNATIONAL

AND CHAIR, EAC)

GEORGE CHRYSOCHOS

(CEO, CYFIELD GROUP OF COMPANIES)

GEORGE THEODOTOU

(CEO, ALPHAMEGA HYPERMARKETS)

CHRISTODOULOS STEPHANIS

(GENERAL MANAGER,

A. STEPHANIS & CO LTD)

KODROS PILAKOUTAS

(HEAD OF BUSINESS OPERATIONS,

CHAR. PILAKOUTAS GROUP)


“WE ENVISAGE CYPRUS

BEING AMONG THE

PIONEERS IN THE GREEN

AND DIGITAL TRANSITION;

A COUNTRY WITH A

RESILIENT HEALTH SYSTEM, A

WELFARE STATE THAT OFFERS

STRONG PROTECTION TO

THE MOST VULNERABLE

MEMBERS OF SOCIETY”

CONSTANTINOS PETRIDES

George Michail

“FASTER AND

SUSTAINABLE GROWTH

CAN ONLY BE ACHIEVED

THROUGH A COMPLETE

TRANSFORMATION OF

THE ECONOMY AND,

MOST IMPORTANTLY,

THROUGH A

COLLECTIVE

COMMITMENT TO THIS

TRANSFORMATION”

CHRISTOFOROS HADJIKYPRIANOU

expected, covering the substantial

loss of Russian and Ukrainian visitors

with those from other markets.

Specifically, tourist arrivals for the

first four months of 2022 constituted

around 80% of arrivals during the

same period in 2019, which was a record

year for Cyprus. Based on that,

according to our revised forecasts,

the economy is projected to grow by

2.7%, 3.8%, 3.4% and 3.0% for the

years 2022-2025 respectively.” On

hearing this, Pieris Markou was quick

to mention rising inflation. “As an

outward-looking economy, Cyprus

is definitely affected by the situation

triggered by the war in Ukraine. The

energy crisis, inflation and disruptions

to the supply chain are just some of

the developments affecting the global

economy and, of course, Cyprus. Inflation

already exceeds 8% here, due

to constant rises in the price of fuel,

electricity and primary products.”

He went on note that product delays

and shortages have recently started to

appear while investment is also at a

standstill due to global market disruptions,

the termination of the Cyprus

Investment Programme and sanctions

against Russia. “These are a deterrent

for potential investment and all these

negative developments mean that the

growth of the economy will be lower

than last year.”

Christos V. Vasiliou agreed, pointing

out that the war has taken us back to

square one. “The War in Ukraine began

just when all economic indicators

for Cyprus were pointing towards

growth and stability with projected

GDP growth of 4-5%, without

factoring in pre-existing inflation,”

he noted. “The Cyprus economy is

very much dependent on FDI, and

international economic shocks affect

it, especially when they take place in

countries such as Russia and Ukraine

with which we have business relations.

This situation will inevitably

have a negative effect on professional

services – one of the strongest pillars

of our GDP – and tourism, at least in

the short and medium term.”

At this point, Eleni Kaloyirou suggested

that there could be light at the

end of the tunnel as regards tourism.

“I believe that the travel and tourism

sector has the prospects to recover

and is worth investing in,” she said

determinedly, while acknowledging

that, “This ‘catch-up’ period will,

however, be challenging. The private

sector on its own cannot successfully

complete this transition. The state

must work together with the private

sector and invest in the development

of new markets as well as the expansion

of existing ones, both in terms of

promoting Cyprus as a destination as

well as in improving the quality of the

services we offer as a country.”

Where does the banking sector stand

in such times of crisis? Andreas Petsas

did not hesitate to outline the duties

of financial institutions towards the

economy. “Banks, with the guidance

of the regulator, have adjusted over

the years to be able to deal with

various emerging crises. This is why,

today, we have such a strong banking

sector in Cyprus. Exogenous factors,

| 81 |

“WE MUST EXPAND OUR TOURISM PRODUCT AND

SERIOUSLY CONSIDER SEEKING TO ATTRACT FDI FROM

JURISDICTIONS SUCH AS ISRAEL AND OTHER EU

COUNTRIES BY OFFERING ATTRACTIVE INCENTIVES”

CHRISTOS V. VASILIOU

George Michail

Christos V. Vasiliou

like a pandemic or geopolitical turbulence,

are beyond anybody’s control

but the banks still need to have the

cushions to absorb these shocks to a

great extent.” Stavros Pantzaris supported

Petsas’ statement and delved

further into the challenges that need

to be faced. “The banking sector, like

the real estate and tourism sectors,

has helped the economy grow over

the last few decades but, in the coming

years, growth will come mainly

from investment in sustainability and

technology,” he said. “When selecting

an investment destination, organisations

are increasingly looking for

human talent and skills related to the

green and digital economy, as well

as relevant government policies, and

much less to corporate tax rates,” he

went on. “We therefore need to focus

on upgrading human resources and

introducing policies and legislation

that support growth in these areas.”

George Chrysochos chose to focus

on the silver lining in the current

disastrous landscape regarding the

real estate sector. “In the long term,

Cyprus will benefit from the instability

that the war is creating in Russia

and Ukraine,” he said, and elaborated

further: “Even if the war ends soon,

Russian and Ukrainian businesses,

HNWIs and families will seek a safe

haven in which to continue their

operations and retain their well-being

without any country risks. Cyprus

has traditionally been such a destination,

so we will see more skilled

professionals coming to the island as

more companies relocate or set up

headquarters here. As a result, we

can expect to see a continuous high

demand for residential and commercial

properties. High inflation has

caused the ECB to raise interest rates,

making the cost of finance higher

for home buyers, so it is important

to sustain conditions of full employment

to keep mortgages affordable.

The latest increase of 0.75% is too


Christoforos Hadjikyprianou

Christodoulos Stephanis

George Theodotou

Andreas Petsas

small to significantly affect the housing market.”

“Tourism is – and I believe will remain – the number

one pillar driving our economy” said Andreas Petsas,

“But opportunities for new clients are arising in a

number of energy projects, hydrocarbon service-related

industries, trade and shipping. Given the continuous

interest shown by foreign investors in these industries,

opportunities for banks continue to arise all the time.”

SUSTAINABLE

ECONOMIC GROWTH

“Whatever we do, there should not be any doubt or

uncertainty about the direction we wish to take,” said

“REDUCING BUREAUCRACY

AND FULLY DIGITALISING THE

PUBLIC SECTOR WILL ADVANCE

ECONOMIC GROWTH AND

ATTRACT MORE INVESTMENTS

FROM ABROAD”

GEORGE THEODOTOU

| 83 |

“THE TRAVEL AND TOURISM SECTOR HAS THE PROSPECTS

TO RECOVER AND IS WORTH INVESTING IN”

ELENI KALOYIROU

Despina Panayiotou Theodosiou

Stavros Pantzaris

Despina Panayiotou Theodosiou. “What

is required is a pragmatic approach –

there needs to be infrastructure that

promotes economic growth; we need to

invest more in human capital, enhance

entrepreneurship and productivity and

encourage innovation and new technologies.

Most importantly, we must ensure

that economic growth will be good for

all. We need an inclusive, diverse economy

that focuses on a sustainable future.”

Christoforos Hadjikyprianou then outlined

some key areas which, in his view,

can act as torch bearers in the future.

“Faster and sustainable growth can only

be achieved through an entirely new

approach, a complete transformation

of the economy and, most importantly,

through a collective commitment to

this transformation. The foundations

of fast and sustainable growth will rest

on three pillars: The green economy,

the digital economy and the knowledge

economy. Whatever we pursue from now

on, whether they be existing sectors or

new ones such as ICT, medical tourism,

alternative financing, etc., these three

transformative elements – green, digital

and knowledge – will have to be present.

They are crucial fundamental ingredients

for a sustainable economic model.”

“We have witnessed an enormous wave

of adoption and awareness of sustainability,

worldwide,” added Christodoulos

Stephanis. “It is of the utmost importance,

as a country with vast resources of

renewable energy, that we not only adopt

but drive this change. We can and should

invest in green energy and sustainability

as a means of attracting foreign invest-


Pieris Markou

“ON A LOCAL

LEVEL, THE

REFORM OF

THE PUBLIC

SECTOR,

THE JUSTICE

SYSTEM, LOCAL

GOVERNMENT

AND THE

TAX SYSTEM,

IS VITAL TO

ENSURE OUR

ABILITY TO

ADJUST TO

THE ‘NEW

NORMAL’”

PIERIS MARKOU

“GIVEN THE CONTINUOUS INTEREST

SHOWN BY FOREIGN INVESTORS IN

ENERGY PROJECTS, HYDROCARBON

SERVICE-RELATED INDUSTRIES, TRADE AND

SHIPPING, OPPORTUNITIES FOR BANKS

CONTINUE TO ARISE ALL THE TIME”

ment and of being accountable for tomorrow’s

world – the one that our children will live in –

and ensure that our passion for betterment lies at

the forefront of innovation.”

“Sustainable economic growth can be achieved

by implementing policies with a positive social

impact, which include society and its members

as a whole,” said Kodros Pilakoutas. “It is imperative,

though, that as a country, we move

forward in the renewable energy sector. As an

island blessed by the sun, we should be paving

the way to a green future, independent to the

maximum possible degree from oil and gas.

The way we are prepared to meet the challenge

of sustainability will define our future,” he noted

rather ominously.

Constantinos Petrides agreed. “The need for a

ANDREAS PETSAS

long-term sustainable growth strategy and the

ability to attract more foreign investment has

been at the forefront of the Government’s economic

objectives. This can be achieved firstly by

safeguarding macroeconomic stability, pursuing

prudent fiscal policies, ensuring financial stability

and maintaining a competitive, business-friendly

regulatory environment. Secondly, we have

recently prepared a long-term growth strategy,

based on a clear identification of the challenges

the country is facing, barriers to growth and

the reforms needed to unleash Cyprus’ growth

potential. It also includes certain sectors that

could expand further, so as to improve the diversification

of the economy,” Petrides explained,

before stressing that, “The national Recovery and

Resilience Plan and the long-term strategy constitute

supplementary pillars that are moving in

tandem. Through the RRP, we aim to promote

Cyprus as a country with high levels of resilience,

where the education system and workforce

skilling/upskilling are aligned with the needs of

the future. Through the implementation of the

RRP, we also envisage Cyprus being among the

pioneers in the green and digital transition; a

country with a resilient health system, a welfare

state that offers strong protection to the most

vulnerable members of society. I strongly believe

that the Recovery and Resilience Plan can be a

game changer, regarding the sustainability of the

recovery and the rationalisation of the economy,”

he concluded.

FDI

It didn’t take long before the issue of Foreign

Direct Investment arose. George Theodotou was

eager to stress the importance of collaboration

between the state and the business world. “We

must focus on strengthening and attracting investment

in crucial sectors of the economy, such

as technology, education, R&D, renewable energy,

supply chain and logistics, which are engines

of growth at present. Strengthening these industries

will have a multiplier effect for the entire

economy and create thousands of high-quality

jobs,” he told the gathering and added: “Furthermore,

when it comes to attracting investment,

the state and the business community must work

together to promote Cyprus and its comparative

| 85 |

advantages abroad and make the country an even

more business-friendly destination, through targeted

and sustainable policies and incentives.”

“Foreign investors see Cyprus as an increasingly

attractive investment destination and appreciate

many of its comparative advantages, including

the skills of the local labour force and the country’s

tax regime and infrastructures,” argued

Stavros Pantzaris, but he agreed that, in the

context of a rapidly changing global economy,

we need to step up the pace of transformation of

the economy and open it up to new, dynamic

sectors.

George Chrysochos then added his own view of

the matter. “Cyprus should attract investments

that benefit the economy in the long term. The

most important and direct way is to promote

headquartering in Cyprus.” He noted that, while

everyone is agreed on this and important work is

being done by many relevant bodies, the present

regulatory and legislative framework does not

support it. “There is still too much bureaucracy

and delays continue in the issuing of planning

and building permits for offices and residential

projects. There are difficulties with issuing work

visas for employees and a lack of tax incentives

for Real Estate investments.” He went on to say

that, with the Russian & Ukrainian markets facing

major challenges, Cyprus needs to diversify

and target other regional markets such as Israel,

Egypt, the Middle East and other EU member

states. “Cyprus in one of the few countries in the

region which has friendly relations with both

Israel and all the Arab countries, and it also needs

to re-establish and strengthen its traditional business

relationship with the United Kingdom.”

Christos V. Vasiliou returned to George

Chrysochos’ focus on headquartering and said

that greater efforts need to be made in order to

establish Cyprus as the ideal location for companies

in the ICT, Energy, Funds, Healthcare and

Education sectors to set up their headquarters.

“We must also expand our tourism product and

seriously consider seeking to attract FDI from

jurisdictions such as Israel and other EU countries

by offering attractive incentives,” he stated

decisively. And he agreed with the Finance Minister,

noting that, “The Resilience and Recovery

Facility is an ideal means of transforming our

country into a modern economy, by making all

those structural changes needed to transform it

into a modern investment destination without

considerable cost, since there is ample available

funding from the EU. We need to make all the

structural changes that will enable us to take advantage

of those funds.”

“The Government needs to quickly translate its

share of resources from the Recovery Facility into

tangible projects and specific investment propositions,

both for the state as well as for private

investors,” Eleni Kaloyirou said thoughtfully.

“The plan must be clear and transparent, so that

investors can assess the financial viability of such

projects. Equally importantly, the state needs to

ensure that red tape is minimized so that projects

are executed quickly and efficiently. The Government

has promised to streamline and expedite

procedures in the past and it needs to deliver on

this promise if we are going to have tangible results.

This will improve the image of Cyprus and

encourage much-needed investment, especially

from foreign investors, which is required to deliver

the future growth of the economy.”

Pieris Markou noted that, “The international

scene will see a significant step towards stabilisation

once the war in Ukraine ends and the

energy crisis is resolved,” and shared his own

vision for the Cyprus economy. “On a local

level, the reform of the public sector, the justice

system, local government and the tax system, is

vital to ensure our ability to adjust to the ‘new

normal’. It’s also important to accelerate our

digital transformation and build on the country’s

competitive advantages, as well as on new

business sectors, such as energy, research and

innovation, shipping, private healthcare and

education, green and blue development, as well

as sustainable development. Achieving these reforms,”

he said confidently, “will give an impetus

to foreign investment into the country, which is

a fundamental pillar of our economic growth.

To this end, we need to adopt a more modern

investment framework based on transparent and

lawful investment procedures. The new investment

programme should be aligned with European

standards and act as positive promotion of

the island as a business hub.”

George Theodotou pointed out that, “Reducing

bureaucracy and fully digitalising the public

sector will advance economic growth and attract

more investments from abroad. Furthermore,

improving Cyprus’ connectivity and transport

links to the rest of the world, can help establish

the country as a major business hub in the region.”

George Chrysochos instantly agreed. “Cyprus

is still suffering from state bureaucracy in many

areas, from never-ending legal processes and delayed

key decisions. The Government needs undergo

digital transformation in order to expedite

and optimize its procedures and a fundamental

transformation of the country’s legal system is

urgent.”

ENTREPRENEURSHIP

Christos V. Vasiliou did not hesitate to praise

Cypriot entrepreneurship, while pointing out

some of the challenges that may act as obstacles

to its development. “Entrepreneurship has

made huge strides in recent years. It is no longer

confined to the borders of Cyprus but looks to

expand internationally and to improve its market

offering. However,” he noted, “We need to stay

focused because the road from concept to commercial

application is a long one. We also need

to set up an appropriate ecosystem which can

be used to fund those great ideas to bring them

to life. The banking sector should also act as an

important pillar, financing good business propositions

and investing along the way.”

Andreas Petsas clarified that, “There are always

opportunities in every sector of the economy,

provided that a case/transaction is correctly

structured, has the right amount of equity by the

entrepreneurs and shareholders and sufficient

cash flow.”

“Cypriot entrepreneurship has matured over

the last years, adapting to a rapidly changing

environment of uncertainty,” Kodros Pilakoutas

added and Christodoulos Stephanis agreed

wholeheartedly, saying: “Uncertainty has peaked.

“IN THE LONG TERM, CYPRUS WILL BENEFIT FROM

THE INSTABILITY THAT THE WAR IS CREATING.

RUSSIAN AND UKRAINIAN BUSINESSES, HNWIS AND

FAMILIES WILL SEEK A SAFE HAVEN AND CYPRUS HAS

TRADITIONALLY BEEN SUCH A DESTINATION”

GEORGE CHRYSOCHOS


The pandemic, an invasion on European

soil and pessimism in the markets have all

contributed to conservatism as regards innovation

and expansion. In addition, foreign

markets now appear more attractive and are

therefore drawing highly skilled individuals;

globalization has driven uniformity or the

survival of the fittest, thereby drowning local

or developing enterprises and, due to rapid

tech growth and continuous developments

in the IT and data spheres, businesses often

struggle to stay afloat without the necessary

support.”

Constantinos Petrides did not deny the difficulties

mentioned. “It is true that Cypriot

entrepreneurship has faced a lot of challenges

recently, due to the pandemic and more

recently the war in Ukraine and its repercussions,”

he said. “However,” he went on,

“a number of generous government support

packages have helped alleviate some of the

cost borne by businesses and households, by

providing additional liquidity, preserving

their viability and jobs.”

“Countless challenges still remain today,”

Stavros Pantzaris added, in agreement with

what had been stated, “but if you asked me

to identify the most critical among them,

I would say: (a) digital transformation and

its impact on jobs and skills, (b) the global

effort to combat climate change and (c)

society’s rising expectations from companies

to place ESG issues at the core of their strategies.

These challenges also represent great

Kodros Pilakoutas

“AS AN ISLAND

BLESSED BY THE

SUN, WE SHOULD

BE PAVING THE

WAY TO A GREEN

FUTURE,. THE WAY

WE ARE PREPARED

TO MEET THE

CHALLENGE OF

SUSTAINABILITY

WILL DEFINE OUR

FUTURE”

KODROS PILAKOUTAS

| 87 |

opportunities for businesses and those that can

identify and act upon them are likely to prosper

and lead growth in the years ahead.”

Despina Panayiotou Theodosiou, however,

stressed the importance of merging sectors and

know-how in various industries in order to support

entrepreneurship and not merely to realise

short-term visions. “The challenge is not just

about encouraging entrepreneurship. It is about

supporting it with suitable financial structures

and linking entrepreneurs with the academic

world and the public sector,” she said, suggesting

that there should also be greater cooperation with

the financial world, “because new ideas need

financial support, which has to recognise the balance

between risk and reward.”

“Entrepreneurship can lead a country but it also

needs the state to facilitate the path” said Christoforos

Hadjikyprianou in agreement with her.

And he continued, “Allow me to mention that

for a country with an unparalleled competitive

advantage in solar energy capacity, the fact that

we are stuck at 15% renewable energy output

shows that we have a serious problem of focusing

on what is necessary and important. There is only

so much that businesses can do in an unwilling

context. The state must play its part by speeding

up bureaucratic processes and establishing a

more efficient and business-friendly digital space.

Equally, there are new challenges that relate to

the need to upskill the workforce, identify and

develop new talents. This drive must not only be

sustained but it must be accelerated, despite potentially

new inflationary pressures on the global

and local economy. If we let up now, things will

move backwards.”

“In my view, the business scene will change

significantly in the coming years,” said Pieris

Markou. “Traditional sectors will still continue to

be the focus but we will see new sectors arising.

The great challenge for Cypriot entrepreneurs in

the short term is to embrace technology. Companies

that invest in developing and offering

technology solutions will remain competitive

and on the frontline of development. Businesses

will also have to look into their operating costs;

they should develop an outward-looking culture,

while creating and promoting new products and

services based on market needs. All this will be

fundamental to the future of business in Cyprus.”

“The European Recovery & Resilience Facility

has laid the foundations, to which both the state

and the business sector must respond,” said

Christoforos Hadjikyprianou, like a man on

a mission. “As educational institutions, we are

playing our part. I detect some progress in that,

after years of pressure, we are gradually seeing

partnerships of entrepreneurship and education

“WE CAN

AND SHOULD

INVEST IN GREEN

ENERGY AND

SUSTAINABILITY

AS A MEANS OF

ATTRACTING

FOREIGN

INVESTMENT

AND OF BEING

ACCOUNTABLE

FOR

TOMORROW’S

WORLD

CHRISTODOULOS STEPHANIS

as what we call the ‘knowledge economy’ begins

to take off. The business community has a lot

to give and a lot to learn from our research institutes

and their scientific output and we need to

strengthen that partnership. That is where the

future lies”.

By now, it was 3:30 pm and time for the 12

participants to relax with coffee and Beba’s

signature semifreddo cake and to forget about

business for a while. Meanwhile, the weather

had changed once more and a slight breeze hung

in the air, while the sky had begun to cloud over

but, now reflecting the overall optimistic tone

of the preceding conversations, we could still see

the sun shining through.

Special thanks to Βeba Restaurant

| 88 | TRUSTS

PROTECTING

YOUR LEGACY

THROUGH

A • CYPRUS

INTERNATIONAL

TRUST

By Elena Christodoulou, Advocate/Senior Associate,

Corporate Department and Alexis Christodoulou,

Advocate/Associate, Corporate Department,

Elias Neocleous and Co LLC

Trusts are highly versatile instruments

which can be used for a wide variety of

purposes to achieve specific goals. In simple

terms, the common law Trust is structured

as a triangular relationship where

the Settlor unilaterally transfers property

to the Trustee (whilst not forming part of

the Trustee’s property) for the benefit of a third person which

is the Beneficiary.

What is a Cyprus International Trust?

IN TERMS OF SECTION 2 OF THE LAW, A CYPRUS INTERNATIONAL

TRUST (CIT) IS DEFINED AS A TRUST IN RESPECT OF WHICH:

• the Settlor (whether a natural or legal person) is not a resident

of Cyprus for the calendar year prior to the creation of

the Trust;

• at least one of the Trustees is, during the whole duration of

the Trust, a resident of Cyprus, and

• no Beneficiary (whether a natural or legal person) other than

a charitable institution is a resident of Cyprus for the calendar

year prior to the creation of the Trust.

Utilization from a personal

tax perspective in Cyprus

One of the key standout points in the above definition, from

a personal tax perspective, is that Beneficiaries should not be

residents of Cyprus for the calendar year prior to the creation

of the Trust. What this effectively means is that a Beneficiary

of a CIT can take up tax residency in Cyprus at any stage after

the Trust has been established and benefit from the benign

personal tax system which Cyprus has to offer, specifically in

relation to non-domicile tax residents who are exempt from

Special Defence Tax on dividend income, interest passive

income and rental income (note: rental income is subject to

income tax) until they complete 17 years of tax residency in

Cyprus (provided that they become Cyprus tax residents for

the first time).

CYPRUS IS IN THE “PREMIER LEAGUE” OF TRUST

JURISDICTIONS AND A DESTINATION OF CHOICE FOR

THE ESTABLISHMENT OF INTERNATIONAL TRUSTS

| 89 |

Settlors’ reserved power

THE LAW ALLOWS THE SETTLOR OF A TRUST TO RESERVE POWERS TO

HIMSELF OR HERSELF, TO RETAIN A BENEFICIAL INTEREST IN TRUST

PROPERTY, OR TO ACT AS THE PROTECTOR OR ENFORCER OF THE TRUST,

ALL WITHOUT AFFECTING THE VALIDITY OF THE TRUST. THE POWERS THAT

MAY BE RESERVED ARE EXTENSIVE, AND INCLUDE THE POWER:

• to revoke, vary or amend the terms of the Trust;

• to apply any income or capital of the Trust property;

• to act as a director or officer of any corporation wholly or partly

owned by the Trust;

• to give binding directions to the Trustee in connection with the

Trust property; and

• to appoint or remove any Trustee, enforcer, protector or Beneficiary.

The Settlor may impose a general stipulation that the Trustees’

powers are exercisable only with the consent of the Settlor or any

other person specified in the terms of the Trust. The Settlor may also

reserve the power to change the governing law of the Trust. These

provisions give Settlors great flexibility to adapt to changes in circumstances

or objectives.

Asset protection features

Asset Protection Trusts ring-fence the Settlor’s assets from persons

who may have a claim against him or her. An Asset Protection Trust

adds another layer to the defences. They are also invaluable in a variety

of other contexts. In personal life, in light of the substantial awards

that courts in certain jurisdictions are making, an Asset Protection

Trust may be used to provide added reassurance against claims on the

breakdown of marriage or a civil partnership, particularly for individuals

from jurisdictions where prenuptial agreements are ineffective.

Many countries have forced heirship provisions in their succession

law, reserving a specified portion of the deceased’s estate for relatives,

and an Asset Protection Trust may provide a means of regaining freedom

of testation.

By their nature, all Trusts provide an element of asset protection by

segregating the assets held in trust from the Settlor’s general assets,

which would be available to satisfy his or her debts or, in the worstcase

scenario, would pass to his or her Trustee in bankruptcy; however,

a CIT has several further advantages.

The Law contains a very strong presumption against avoidance of a

CIT. Unless the court is satisfied that the Trust was made with the

intent to defraud persons who were creditors of the Settlor at the

time when the payment or transfer of assets was made to the Trust,

the Trust will not be void or voidable, notwithstanding the provisions

of any bankruptcy or liquidation laws of Cyprus or any other

country and notwithstanding the fact that the Trust is voluntary and

without consideration, or that it is for the benefit of the Settlor or his

or her family members. The burden of proof of the Settlor’s intent

to defraud lies with the person seeking to set aside the transfer. Furthermore,

any action for avoidance of the Trust or setting aside of the

transfer must commence no later than two years after the assets were

transferred to the Trust.

These provisions, particularly the requirement to prove intent to defraud

on the part of the Settlor, set the bar very high for a claimant

trying to set aside a transfer to a CIT. Even though the standard of

proof is the balance of probabilities, rather than the criminal standard,

the claimant must still establish that the Trust was more likely than not

a fraud. This is a difficult standard to meet in practice, and the burden

of proving fraud is higher than is usual for civil cases. In practice, the

claimant would need very strong evidence to show that the Settlor

intended to defraud his or her creditors. A claimant domiciled outside

the EU without assets in Cyprus would be required to provide security

for costs under Order 60 of the Civil Procedure Rules.

Protection against forced heirship and similar claims is provided by

Section 3(i) of the 1992 Law, which stipulates that the laws of Cyprus

or of any other country relating to inheritance or succession will not in

any way affect any disposition of assets to a CIT.

The Law strengthened these defences by explicitly providing that any

question relating to the validity or administration of an International

Trust or a disposition to an International Trust will be determined

by the laws of Cyprus without reference to the law of any other jurisdiction.

It also makes it clear that the fiduciary powers and duties of

Trustees, and the powers and duties of any protectors of the Trusts,

are governed exclusively by Cyprus law. Furthermore, it provides that

dispositions to a Trust may not be challenged on the grounds that they

are inconsistent with the laws of another jurisdiction – for example, regarding

family and succession issues – or on the grounds that the other

jurisdiction does not recognise the concept of Trusts.

Finally, the Law entrenches jurisdictional protection by providing that

an International Trust containing a choice-of-law clause in favour of

Cyprus law is fully protected from unfounded foreign judicial claims as

a matter of public policy.

These provisions further reinforce the already formidable asset protection

features of the CIT.

The enactment of the Law has elevated Cyprus to the “Premier league”

of Trust jurisdictions, making the island a destination of choice for the

establishment of International Trusts. Further, upon consideration of

other local laws, the island is also an attractive destination of choice for

personal residency once an International Trust has been established.

With the correct planning and considerations, the creation of a CIT

can be a highly valuable tool in relation to asset protection, succession

and tax planning.

| 90 | INTERNATIONAL WEALTH

Michael

Milonas

Benjamin

Bilski

INTERVIEW | 91 |

The

Long

and

Winding

Road

to Success

Benjamin Bilski, Founder and CEO, and Michael Milonas, co-founder and CEO of NAGA, recall the internal company struggle

that became the impetus for the trading platform to become a frontrunner in the neobroker business and explain how an

obsession with winning, combined with finding the right partner, ultimately led to success.

Photo by TASPHO

| 92 | INTERVIEW

In the back room on NAGA’s top

floor, there are people setting

up cameras and fiddling with

microphones. I am supposed to

interview the neobroker’s two shotcallers,

Benjamin Bilski and Michael

Milonas, but I can’t recall for the life

of me to have agreed to capture the

whole affair on video. It is explained

to me that this is just another day at

the office for them – in retrospect, I

shouldn’t be surprised. Neobrokers

emerged as a means for millennials to

enter the capital markets, employing

clever user interfaces on their trading

platforms that take their cues from

games, which evidently makes trading

accessible to a wider audience. And,

most importantly, they incorporate

practices developed by social media:

on a neobroker’s platform, traders can

trade in ideas and novices can copy

the experts. So, storytelling is innate to

NAGA, whether done in a chat room or in front of a camera.

As a teenager, Benjamin Bilski discovered that he was a fast

swimmer and realised that this was the perfect sport for

someone with his background. As an only child, he didn’t

play well with others and was comfortable being the centre

of attention. Raised by Polish parents in Germany with the kind

of discipline that was needed to quickly rise through the ranks, he

acquired a taste for competitive swimming, aware that a win was only

as good as the next one. On his way to the top, he did not have time

to explore rebellious teenage nature – he was an adult before having

his first drink in beer country! The life of eat, sleep, swim and repeat,

though, started to wear him down. Looking around, he realised that

success was not only measured by the fastest time and, at the age of

21, the German champion and bronze medal winner at the 2009

World Games announced his early retirement from the sport. Many

were left bewildered and some downright indignant.

my swimming career,” Bilski says, “because

I was having financial issues, I was trying to make

money on the side. I had a passion for fishing

“During

– my family’s from Poland and fishing is a big

thing – so I started to buy and sell fishing equipment online.” In

2009, when he retired from the sport, he decided to set up a proper

e-shop selling fishing gear and outdoor equipment called Angelplatz

(German for “fishing spot”). Meanwhile, he enrolled into the Florida

Atlantic University for a course in business administration. “I always

wanted to study. Basically, I thought that if I wanted to be successful

in business, I needed a degree,” he recalls. Bilski rode the e-commerce

slipstream at the turn of the 2010s, and sold the shop to make

his first million while only 23 years old. But that was never going

to be enough, because it wasn’t about the money – there was always

the next win. In 2014, after burning through some serious cash on

a couple of failed ideas, Bilski found someone to take a small bet on

Copy

trading,

where amateurs

copy the

transactions of

knowledgeable

traders, played

a big part in

changing

NAGA’s destiny

his fashion app that emulated Tinder’s

swipe left and right concept. That investor

would introduce Bilski into the new

fintech wave that was sweeping capital

markets. He jumped on the idea of marrying

social networks and finance, even

though, admittedly, he was a complete

novice at the latter. SwipeStox became

one of the first mobile social trading

apps and the building block for NAGA.

“And this is where Michael and I got

together,” Bilski says.

For as long as he can remember,

Michael Milonas wanted to

win, to be the best at everything.

By the time he turned

17, he had fashioned an amateur workshop

in his parents’ garage where he

fixed bikes and sold parts. His love of

petrol engines was only equaled by his

love of music. It was 1995 and together

with some friends, he landed a non-paid

gig to produce a show called Full Speed

for the now defunct radio station Talk FM. “We were clueless; we

had no idea what music was,” Milonas says. “But, I thought to myself:

that’s a mountain to conquer.” They started working on other

local stations, one of which shared a building in the centre of Nicosia

with the then famous club Versus. “So, having a very curious and exploratory

nature, I got to know the DJ of that club, who wanted me

to be his assistant,” he recalls. A month later, a fight between the DJ

and the club owner gave Milonas a shot at the decks, and despite being

a novice, he took the job. “You know; everybody wants everything

in life – right? But very few get it because very few are willing to do

what it takes,” he says. And, he adds as an afterthought, “It’s not going

to work for everyone; it certainly didn’t work for us here every single

time.” Milonas was the resident DJ at Versus from 1997 to 2000. The

next mountain to conquer was much higher: founding and running

the legal consultancy firm Parparinos Milonas for 10 years.

In late 2015, Bilski was looking at regulatory licensing across

Europe and with CySEC having earned a good reputation,

he was introduced to Milonas. For his part, Milonas recalls

that he saw in Bilski a younger version of himself, “one who

was willing to take huge leaps of faith.” The connection was

instant – the kind of chemistry that’s difficult to capture in

a sentence – and they agreed to work together. Milonas would run

a small team in Cyprus and build the back-end brokerage software,

while Bilski would stay in Germany to get the company off the

ground. At the time, the brokerage industry in Cyprus appeared to

be too set in its ways to see any value in bringing the traditional buzz

of the trading floor into the digital world of modern trading – and

they weren’t particularly welcoming to new entrants, either. “I met

with 14 or 15 brokers in Limassol and I told them ‘this will increase

your sales; this will increase your revenue’. They said it was nonsense,”

Bilski says. He turns to Milonas and asks, “What did you call

them – cut-throat, right?”

| 93 |

Meanwhile, during those first few years, irreconcilable

differences at the top were dragging NAGA down to

the bottom. Bilski wanted to get the fundamentals

right. His co-founder, though, was already selling

the company as a US$10-billion idea. This attracted a certain

type of employee and created a culture that was, in his view, too

concerned with appearances and little to nothing at all with substance.

Managing a group of people with such a different value

system made life increasingly difficult for Bilski. “I was always

sitting in my own office. I wouldn’t talk to anyone there. I was

doing my thing, trying to do as much as possible on the base

level and fundamentals. And then I got into a huge, massive

scrimmage with the co-founder. I couldn’t stand it anymore,”

he says. By 2019, NAGA was on the brink of collapse. Bilski left

Germany and came to Cyprus in a last-ditch effort to salvage the

company. He knew that the only way to win was to take control

of the product.

Milonas takes a rather serious tone. “Without Ben coming

to Cyprus, none of this would have happened,” he says.

With both men sharing an understanding that wins

were built from the ground up, they resolved to fight for the company.

They boarded a plane to Shanghai, convinced their biggest

shareholder to back them up and put their own money where

their mouth was. NAGA had been listed on the Frankfurt Stock

Exchange since 2017 and the other shareholders were people who

didn’t offer the kind of value that Milonas and Bilski wanted to

add to the company. So, they made them an offer they couldn’t

refuse: they either took the money, or the two men would walk

out, taking the engine of the company with them and leaving the

shareholders to deal with the spare parts.

“We didn’t take out guns but all the rest

was there,” Milonas remarks in a

deadpan manner. “It was very tough;

psychologically, stress-wise. And

don’t forget, Ben and I were also

taking a massive responsibility and the liability to run a company

that was literally being driven into the ground.”

Bilski says, “For me, it was everything.”

A lot of people were eventually fired and others bought

out – Bilski and Milonas were effectively the last men

standing. So, it made sense to move the company to

Cyprus. In Bilski’s words, the land of sun and sea offered the right

business environment and people with the right mindset to build

a great company. As luck would have it, their new product-first

approach came at the right time. The platform was ready for the

great influx of millennials, who flocked to neobrokers (and other

trading platforms) to make up their losses in the capital markets

from the economic hurt delivered by the pandemic lockdowns. In

2021, NAGA raised US$100 million in capital from Star Investors,

hired 150 people – most of them in Cyprus – onboarded a

record number of some 250,000 customers, transacted more than

a quarter of a trillion dollars in volume, and derived one of Germany’s

best share price performances. As a result, the company’s

valuation leaped from US$180 million to US$465 million. Copy

trading, where amateurs copy the transactions of knowledgeable

traders, played a big part in changing NAGA’s destiny. That same

year, NAGA paid some US$2 million in copy bonuses. They got

the fundamentals right – so, on to the next mountain.

“I

don’t mean any disrespect to the industry, but

I fail to see a vision; somehow they’re all doing

the same stuff. It’s some old-school banking,”

Bilski says. Among the many features introduced

last year was NAGA Pay, a payments

solution that combines an IBAN account, a

debit card, a broker account and a crypto wallet. NAGA wants to

bring to the trading business the one-stop shop concept that has

seen such great success with Big Tech. What Bilski envisions for

NAGA is for people to dive into a new world, where they are using

the app to buy groceries, when they suddenly receive a push

notification that the latest NFT is coming out and, in the same

breath, move part of their funds into their digital assets. “I think

this also resonates with our team,” Bilski goes on. “It’s something

that they can relate to, because they are not just sitting in front of

a chart. We already represent change. Working at NAGA now is

a thing, at least in Cyprus. They see us as springboard, as being in

the right company in the right sector.”

I ask both of them, “How does it make you feel to have won that

huge bet and are now reaping the benefits?

Bilski answers in the most German of ways. “It’s gut. But, it’s

not over.”

Milonas chimes in. “We haven’t actually

reaped any benefits. Look, we just proved

that this company has a future. And the journey

“Exactly,”

ahead is long and difficult.”

NAGA wants to bring to the trading business

the one-stop shop concept that has

seen such great success with Big Tech

10 TH ANNIVERSARY

INTERNATIONAL INVESTORS,

INDIVIDUALS, AND COMPANIES

FOR THEIR SUBSTANTIAL CONTRIBUTION

TO THE CYPRUS ECONOMY

JULY 2022 | PARKLANE RESORT & SPA, LIMASSOL

3,500

distinguished guests

76

winners

550

nominees

10

sponsors/partners

156

award presenters

SPECIAL THANKS TO ALL OUR SPONSORS

FOR THEIR CONTINUING SUPPORT!

PLATINUM SPONSOR

GOLD SPONSOR

POWERED BY

MEDIA SPONSOR

UNDER THE AUSPICES OF H.E.

THE PRESIDENT

ORGANISERS

PRINTED WITH CARE BY KEMANES PRINT SHOP

| 96 | FAMILY BUSINESSES

FAMILY

BUSINESSES

TODAY: RISING

CHALLENGES

IN A RAPIDLY

CHANGING

ENVIRONMENT

By Demetris Vakis, Board Member,

Head of Family Business, KPMG in Cyprus

To many, the term “family business”

means a rather small or medium-sized

business with a local focus. It also connects

with a set of common and perennial

issues such as succession planning,

pressure to hire family members, the

lack of a defined strategy in case of the

planned or sudden retirement of the owner and a high turnover

of non-family employees.

While many small businesses do fit that description, this does

not diminish the powerful role that such enterprises play in

the local and, indeed, the world economy. On the contrary,

family firms in Cyprus, accounting for over 90% of businesses,

are responsible for job creation and for making valuable

contributions to the national economy.

Family enterprises are significantly different from others,

in that their ownership structure gives them a long-term

orientation. “The regenerative power of family businesses

– Transgenerational entrepreneurship” survey report by

KPMG Private Enterprise and the STEP Project Global

Consortium, published in 2022, brings together insights

from 2,439 CEOs and other leaders from top family businesses

across 70 countries and territories, illustrating the

common factors that make up the formula for family business

resilience and regeneration: a strong entrepreneurial

orientation, emotional attachment to their business and an

ambitious next-generation leadership seeking new experiences

beyond the family business.

While family businesses are different and unique in the

business world, they are still affected by the overall social

and economic environment. Today, governments, businesses

and people in Europe and in Cyprus are increasingly concerned

with challenges such as rising inflation and the surge

in energy costs. The stagnation period experienced during

ALTHOUGH, IN MANY CASES, FAMILY

BUSINESSES OUTPERFORM

NON-FAMILY-OWNED BUSINESSES

WHEN IT COMES TO PROFITS, TODAY

THEIR VERY SURVIVAL IS IN DANGER

| 97 |

FAMILY ENTERPRISES ARE SIGNIFICANTLY DIFFERENT

FROM OTHERS, IN THAT THEIR OWNERSHIP STRUCTURE

GIVES THEM A LONG-TERM ORIENTATION

the COVID-19 pandemic is now being made worse due to the impact

on the economy of the war in Ukraine. A volatile economic

environment has ensued, with businesses of all sorts trying to curtail

costs and remain relevant, while also maintaining and expanding

their customer base.

The evolving digital economy, changes in technology and globalisation

have far-reaching consequences on the business models of family

businesses. COVID-19 has created a new reality for the business

world, where digitalisation in every possible aspect of a business is

crucial. Family businesses, in particular, need to onboard new technologies,

turning digital where possible in an attempt to deal with

the changes forced by this new reality. In addition to digitalisation,

innovation is also high on their agenda, as they now recognise that

the world we live in has dramatically changed and doing the same

things as before and expecting different results may not be the right

strategy for future survival, let alone success. Although, in many

cases, family businesses outperform non-family-owned businesses

when it comes to profits, today their very survival is in danger. Notably,

in the time frame of a single generation, businesses have had

to adapt to new digital marketing and delivery channels, to decide

how to invest in new technologies and compete on a global stage.

It is widely accepted that business transformations that once took

decades to take place are now happening in the space of just a few

months, mainly because of the rapid pace of technological change

and increased competition.

These rapid changes and volatility have made it evident that no

single employee – not even a CEO – can be an expert in everything.

In these times, family businesses should be more outward-looking,

open to recruiting people with expertise and know-how, who may

not belong to or have ties with the family.

The challenge for family businesses is to sustain dynamic progress

across the generations. To do this, they need to manage the

inherent conflict between family and business needs on a consistent

basis. Family expectations should be managed and the same

should apply to the business. Conceptually, succession is a process

that needs to be methodically planned and executed. During the

pandemic, though, it has been happening unexpectedly and haphazardly.

Family businesses are often reluctant to bring in talented

people who do not belong to the family, fearing that they will

interfere with the succession planning. This is an issue that needs

to be addressed, especially at a time when a new reality is taking

shape. Also, managing family assets and preserving family wealth

are crucial during these uncertain times. Because family businesses

look beyond merely preserving growth, many of them find it difficult

to address the challenges they are facing without intermixing

family and business affairs. When it comes to innovation and entrepreneurship,

family businesses can find themselves trapped. Their

reluctance to innovate is sometimes based on the fear of losing their

unique identity, losing control, undermining the family reputation,

or compromising socioemotional wealth. Thus, it is imperative to

ensure that the innovation potential is fully unlocked while leveraging

cohesion within the family and the business.

An area that invariably has an impact on the long-term success of a

family business is its ownership. Should the family introduce new

shareholders, be they non-family managers or other investors? This is

a question that can be answered by taking into consideration many

factors, including all the unique characteristics of each business and

the aspirations of the family. The decision may not be based solely on

financial considerations and there is always a dilemma.

The role and composition of the Board of Directors in family businesses

is also important. In most cases of family businesses, the Board

is composed exclusively of family members and, invariably, only the

shareholder(s). Boards are required in all enterprises to provide a more

strategic view of the affairs of the business and offer an impartial assessment,

utilising the collective experience and expertise of trusted

individuals.

Business advice and strategy planning might come from expert external

talent as well. Family businesses that employ outside advisors tend to

make better informed decisions, especially when the required expertise

is not available internally or through the Board. Family business

professionals/advisors can articulate a governance framework that separates

business from ownership and defines a clear process to resolve

any arising issues. In many cases, external professionals that can assist

with the digital journey of the family business are also needed, as many

“traditional” enterprises might not yet have realised the benefits of

e-commerce, for example, or they might not have the necessary skillset

to adapt to the various changes in technology and customer needs. In

addition to focusing on short-term concerns, family businesses need to

address the underlying longer-term challenges they face, to survive and

thrive over generations.

| 98 | INTERVIEW

A Deepening

Relationship

| 99 |

France’s Ambassador to Cyprus, Salina Grenet-Catalano, explains how the already excellent relations between the

two countries could improve even further while also revealing how global events first inspired her to become a

diplomat and later confirmed the correctness of her choice.

Photo by Taspho

Taking place

during a particularly

complicated

time

for Europe,

the French

Presidency of

the Council of

the European

Union ended

on June 31.

How would you take stock of this sixmonth

period?

Indeed, the French Presidency of the EU

Council has taken place in very challenging

times for Europe, due to the war in Ukraine.

Yet the priorities we had chosen at the end of

2021 were, in fact, the right ones: a more sovereign

and strategically autonomous Europe,

implementing a new growth model for Europe

based on the support for the two big transitions

– ecological and digital – and the idea of

a more humanistic Europe that is proud of its

values.

Let me mention a few of our landmark successes.

First of all, our response to the war

in Ukraine: we have managed to agree as

Europeans on six unprecedented sanctions

packages and massive assistance to Ukraine,

in the financial, military and humanitarian

fields. We have proven together that Europe

is, indeed, able to act quickly and swiftly

when necessary. This crisis response is now

also dealing with the energy situation, where

we hope concrete results will be achieved. On

our “non-crisis agenda”, we managed to pass

Europe’s Strategic Compass, which defines

what the threats are for the EU in the world

and how we respond to them collectively.

Major progress has been made

regarding the different texts of the

“Fit for 55” package on climate

for example. In a field that

may interest your readers, we

managed to adopt a directive

that will set an obligation for women

to be represented by at least 40%

on company boards, which goes in the

direction of reaching full equality between

men and women in our Union.

What do you consider to be some of the

main challenges that persist in Europe

today and how do you believe these can be

overcome?

Through the process of the Conference on

the Future of Europe, which reached its

conclusion in May, we asked the people of

Europe this very question. Everyone has

been able to contribute through panels in all

member states and online. This has led to the

formulation of 49 proposals and objectives,

tied to 320 measures. The EU institutions will

now examine the ideas and ensure a rapid and

appropriate follow-up. On 9 May (Europe

Day), President Macron shared his vision of

what the concrete results of this consultation

of our peoples might be. The French president

focused on two keywords: independence and

effectiveness. Notably, our citizens want more

European action on key topics for the future

such as biodiversity, health, and alimentation.

They want a more just, inclusive and democratic

Europe. They want a Europe that can

defend itself, especially in light of the war in

Ukraine, and be the master of its destiny. They

don’t want less Europe but more Europe, more

concrete, with results that can be felt not only

in times of crisis such as the pandemic or the

war, but also in times of peace: to reach carbon

I HOPE

MORE FRENCH

WILL VISIT CYPRUS

BUT MORE

CYPRIOTS SHOULD

ENJOY FRANCE,

TOO. DIRECT

FLIGHTS

THIS SUMMER

HAVE BEEN A BIG

BOOST IN

THAT

DIRECTION

neutrality and phase out fossil fuels, to be independent

for our food supply, to protect our

borders. We will most probably need to change

some treaties to move forward but there are

also many things that can be done within the

current framework. Finally, we will need to

meet the challenge of those who wish to join the

European Union but are faced with a long accession

process. President Macron has proposed

the idea of a “European political community”,

which is a framework around the EU that

would allow us to better cooperate and face our

continent’s challenges.

How do you perceive the current relations

between France and Cyprus and how do you

believe these can be further developed in the

years ahead?

The bilateral relationship between France and

Cyprus is excellent. We have a lot in common

and have been growing closer and closer over

the last two decades. Our joint membership of

the European Union is probably the catalyst

of the strength of our relationship and, beyond

that, a shared belief that the EU should be a

powerful and assertive actor on the world stage.

Accordingly, ties between Cyprus and France are

the most developed in the political and strategic

fields.

I am convinced that we should deepen this

relationship in two main areas. The first one

is related to culture and Francophonie: more

Cypriots should be able to enjoy the benefits of

speaking French and of choosing France for their

studies. And for that they don’t necessarily need

to be francophone from the get-go. There are

many programmes in English too, in all fields

of studies and in prestigious institutions. The

second one is related to our economic ties,

where I think our priority should be to

see how we could do more together

to perform a quick and smooth

ecological and digital transition.

Let’s not forget tourism

as well; I hope more French will

visit Cyprus but more Cypriots should

enjoy France, too. Direct flights this summer

have been a big boost in that direction

and will help deepen the relationship across the

board.

| 100 | INTERVIEW

What areas of investment in France are of

particular interest to foreign investors, including

Cypriots?

I am glad that you ask this question because,

sometimes, due to the different sizes of our

economies, there is the idea that investment can

go only one way. France is particularly attractive

to investors. Actually, according to a study

carried out by EY, France has been the number

one country for foreign investments in Europe

for three consecutive years. It is also number one

when it comes to R&D investment. We have

witnessed a trend in France toward reindustrialisation

in key sectors for the future: healthcare

and the green transition. France is also attractive

due to its very strong and dynamic consumer

market of 67 million people as well as its highly

qualified labour force when it comes to new

technologies, especially in the digital sector.

Through structural reforms in recent years, we

have made France much more business- friendly.

Those were drastic changes toward simplification

and predictability in the fiscal and labour

domains. Foreign investments also benefit a

lot from the strategic investments made by our

government to best prepare the country for the

challenges of the future and boost competitiveness.

As for where Cypriot investors could find some

opportunities, I would say that they should

look for the right “niche” where they can bring

something new to our market that nobody else

provides. Halloumi is already increasingly popular

in France and surely some other products

could follow.

Cyprus is developing as an international

business hub. Do you believe it is attracting

the interest of French businesses and potential

investors? Can you suggest any further

incentives?

Cyprus still isn’t well known or ‘on the map’

of French businesses and investors. This is, of

course, explained by the fact that the island

remains a small market but it doesn’t mean

there aren’t interesting opportunities. Of course,

attracting more French businesses to the island

means attracting their expertise, either directly

or through partnerships. There have been very

positive developments recently such as the partnership

that has been concluded between AlphaMega

Hypermarkets and the Casino Group,

a major actor in retail in France and around the

world. I hope there will be more such success

stories like this in the future. For instance, I

firmly believe that, in dealing with the challenge

of the ecological transition, French expertise

would be really useful to Cyprus. When it

comes to green energy production, storage, grid

improvements, electric cars and high-quality

public transport, we are probably one of the few

countries with nearly everything on offer and

strong know-how.

CYPRIOT

INVESTORS

SHOULD LOOK

FOR THE RIGHT

“NICHE” WHERE

THEY CAN BRING

SOMETHING NEW

TO OUR MARKET

THAT NOBODY

ELSE PROVIDES

What was behind your decision to enter the

diplomatic service?

Although I come from a modest, not international-leaning

background, I nonetheless felt

very early – when I was 15 years old – that I was

destined to become a diplomat. Two significant

historical events struck me and cemented

my choice: the civil war in Lebanon in the

1980s and the fall of the Berlin wall in 1989.

Those two events had a major impact in the

French media back then and raised a lot of

questions for me, especially the situation of

French hostages in Lebanon and the dramatic

situation of the population out there.

I couldn’t understand why, in the name of

their religion or community, people could kill

each other. On that basis, my interest grew

in the Middle East, its religious, political and

cultural complexity. On the opposite side,

the fall of the Berlin wall gave me a glimmer

of hope, demonstrating that the world could

change for the better with the reunification of

Germany and the new dynamic with the EU

to the benefit of our continent. I told myself

that, by becoming a diplomat, I could satisfy

my thirst to discover other cultures, other

countries and to contribute, to the extent of

my abilities, to help bring about peace and

cooperation between those people.

What are the experiences that have impacted

you the most as a diplomat and as a

person during your over two-decade international

career in the diplomatic services?

Without a doubt, two episodes of crisis. First

of all, September 11, 2001. At the time, I

was part of the delegation of our Minister

Delegate for European Affairs, who was on

an official trip to the United States from 9

to 12 September 2001. We were actually

flying over New York when the attack on

the twin towers of the World Trade Center

took place. We then remained stranded

in Boston for several days, waiting for US

airspace to reopen. We participated in very

emotional vigils on the Harvard campus and

shared both the emotion and also the effect

of the shock that had struck the Americans.

On a professional level, this major event has

profoundly changed the way we conduct

diplomacy. The fight against terrorism has

become an international priority. Our relationship

with the United States – for which

I was responsible at the Ministry of Foreign

Affairs in Paris at the time – was deeply affected.

We had to adjust our strategies and

our working methods.

On August 4, 2020, I was chargé d’affaires in

Beirut when the terrible explosion at the Port

occurred and devastated a large part of the

Lebanese capital, leaving thousands dead and

injured. This was followed by a difficult period

of crisis management to help not only the

French people affected but also the Lebanese

population. President Macron made two visits

to Lebanon three weeks apart. A massive

French aid (humanitarian, military, etc.) effort

was deployed, which had to be organised

and coordinated for several weeks.

Those two painful experiences have left their

mark on me personally – especially the second

one – but they have above all shown me

the usefulness of the diplomatic profession,

especially in times of crisis.

How would you describe your life in Cyprus

and what are some of the things you

miss about France?

I consider myself a lucky ambassador! What

more could I ask for on top of the opportunity

to serve in an EU member state, at the

heart of the Eastern Mediterranean region?

This is, of course, a troublesome region of

the world but that complexity is also what

makes it so interesting. Our partnership

with Cyprus is excellent and is becoming

deeper and deeper. On a more personal

note, the country’s beauty, cultural and

historical wealth – including its Lusignan

past – the sun and the Mediterranean character

of the Cypriots reminds me a lot of

Provence where I was born. I wish to carry

out my term here and leave with the sentiment

of having advanced our friendship and

our ties.

| 101 |

OBJECTS

OF DESIRE

While providing a safe haven from the frantic

pace of the outside world, our home is also a

reflection of our individual taste and personality.

Ideally, every object inside it should be one that

we not only find useful but also cherish. And

sometimes, there are items with no particular

use which still bring joy into our lives, simply

by existing. Finding the right furnishings and

other décor for the home is not always easy.

Fortunately, there are a number of select stores

in Cyprus, whose expert personnel will use their

well-honed experience and share their highly

developed taste to present you with a carefully

curated selection of objects of desire, helping

you turn your house, apartment or penthouse

into the home you will truly love and enjoy.

Photos by TASPHO

OBJECTS OF DESIRE | 103 |

Inspiring

Concepts

Emilia Hadjicosti, Director of ambiance & Co, reveals the thoughts that go behind

the selection of the high-quality items in the store, while also underlining the importance

of establishing relationships of trust as she shares her clients’ creative journeys.

How long has your boutique been around? What made

you decide to enter this sector?

I have always had a passion for art and design. After completing

my studies in Milan, the capital of design, where I was

exposed to a plethora of artistic wonders, I was absolutely positive that I

wanted to be part of the interior architecture world. As a result, ambiance

& Co was created, and I have been fortunate to be running this business

successfully since 2001. As part of our commitment to provide luxury

products and exceptional services, we have long-lasting partnerships with

many leading designers from abroad that share the same ethos with us, providing

the necessary elements that determine a modern and quality lifestyle.

Which brands do you represent?

We represent famous Italian brands that are pioneers in the luxury living

sector such as Frigerio, Ivano Redaelli, Sangiacomo, Elmar, Riva, Frag,

Vittoria Frigerio, Milano Bedding, Infiniti, Cutipol, Adriani e Rossi,

Rosenthal, Effeti, Riflessi, Miniforms, MUSA, Talenti, Pierantonio Bonacina,

Jesse, Riva1920, Mogg, Ochre, Penta, Melogranoblu, and more. All

are carefully selected to inspire a sense of contemporary design and luxury

living.

ALL OF THE BRANDS HAVE A

STORY TO TELL, A CONCEPT

TO BE INSPIRED BY, AND A

LIFESTYLE TO BE RELISHED

How do you select which pieces and brands will be part of your store?

Contemporary and minimalistic lines, clean details and elegance have

always been a sort of guiding light. Over the years, we have established relationships

of trust with our clients. Being by their side, we share their creative

journey and with valuable experience, as well as the know-how of all

members of our team, we are able to deliver ideal and tailor-made solutions.

What are your favourite picks at the moment?

Frigerio’s new collection! And the new designs of Elmar kitchens are

exceptionally eminent.

Is there any piece or special brand in your store that deserves special

attention? Why?

All of the brands have a story to tell, a concept to be inspired by, and

a lifestyle to be relished.

How do you view this sector in Cyprus? How does it compare

with that of other European countries?

Since beginning, we have introduced many international brands to

the Cyprus market and we aim to continue driving design forward by

showcasing the very best design houses in a relaxed, informal environment

where clients can feel happy and peaceful. In our country, the

design sector in general is on a pleasantly growing path and one can

easily see that buying behaviour is changing. But the pursuit of standing

out and being distinguished by the quality you offer will always

be a constant factor, no matter where you are in the world.

What are your short and long-term plans?

Our philosophy has always been to deliver the very best in style, quality

and service to a long list of clients, something that has contributed

to our international rise and reputation.

Do you have some tips for those who are now starting the decoration

of their home?

I believe ‘less is more’. And to be alert and observant. Think about

your wished-for living environment, visualise the spaces and share

your needs and wants with a professional. Consequently, the mental

picture you painted will guide you to make it a reality.

A Timeless

Quality

OBJECTS OF DESIRE | 105 |

Elias Ergatoudes, owner of Essere, reveals the secret of his store’s success as the exclusive furniture and homeware boutique in Nicosia

continues to offer top-quality design choices to discerning clients after almost three decades of business.

How long has your boutique been around? What

made you decide to enter this sector?

Essere opened its doors in 1993. A passion for design

and the awareness that it was lacking at the time was

the deciding factor. Thirty years later, we are happy

that we took the risk.

Which brands do you represent?

For the last 30 years, we have represented top brands like Molteni&C,

Giorgetti, Zanotta, Paola Lenti, Living Divani, Emmemobili, Glas Italia,

Tribù, Bonaldo, Saba Italia, Zimmer + Rohde, Glamora and Yo2

among others.

How do you select which pieces and brands will be part of your

store?

Every year we go through a vigorous and exhausting selection process for

the items we will display in our showroom. The furniture mix, as well

as the colour palette, “obeys” the general concept for the season. General

trends do change from time to time; however, we always prefer to

present designs that have a timeless quality, while at the same time incorporating

new materials and techniques, that stem from our companies’

extensive Research & Development activities.

EVERY ITEM AND EVERY

COMPANY WE HAVE

IN OUR SHOWROOM

REPRESENTS A SMALL STORY

TO

REPRESENT

HIGH-END

BRANDS YOU

MUST BE AN

ABSOLUTE

PROFESSIONAL

What are your favourite picks at the moment?

During these perilous times, we must err on the side of caution, especially

in this current inflationary climate. Materials that don’t have a high

production cost and, at the same time, are carbon neutral like wood, will

continue to play a major role in our industry.

Is there any piece or special brand in your store that deserves special

attention? Why?

Every item and every company we have in our showroom represents a

small story you are trying to tell. Each of them holds a special place in

our hearts.

How do you view this sector in Cyprus? How does it compare with

that of other European countries?

We live in a small country, and this creates all sorts of irregularities.

However, one thing that remains the same, in any country, is that to

represent high-end brands you must be an absolute professional. Anything

short of that and you will be a shooting star that lasts a couple of

years. This is a marathon, not a sprint.

What are your short and long-term plans?

The short-term plan is to adjust as best we can to this increasingly unstable

economic environment. The long-term plan is always the same:

to continue evolving our brand and offering the market high-end service

and products.

Do you have some tips for those who are now starting the decoration

of their home?

Always have your budget in mind. There is no rush, you don’t have to

buy everything at once. The best-looking homes are the ones that are

furnished over time. Look for the best value for your budget. The Internet

is a great friend of design, as you can get countless ideas. Once you

have finished doing all these things, pay us a visit at Essere!

| 106 | TRUSTS

PUTTING THE

RIGHT MONEY

IN THE RIGHT

HANDS AT THE

RIGHT TIME

By Georgia Constantinou-Panayiotou, Founding and

Managing Partner, Constantinou Panayiotou and

Co LLC – GCP LAW, Lawyer, Insolvency Practitioner,

Member of Council of the Cyprus Bar Association

Estate planning is not only about building

a portfolio or organising what happens to

your assets after your death. While that

may be part of the issue, it’s mainly about

ensuring a smooth transition of wealth

from one generation to the next.

Creating wealth requires vision, skill and

entrepreneurship, not to mention a mixture of hard work,

good timing and luck. Retaining and protecting wealth also

requires vision, along with a well-thought-out Trust and solid

legal and professional advice.

There are so many complications involved in setting up a

Trust that you must work with a lawyer who specializes in this

complex legal area. To determine whether you need a Trust

and, if so, which type you should establish, you should start

by deciding exactly what you aim to achieve through a Trust.

It can be set up to provide money for successive generations

and earmark funds for certain family members, to preserve

money which may otherwise be diluted or dispersed due to

a divorce or a bankruptcy, to mitigate Income Tax, Capital

Gains Tax or Inheritance Tax, to increase privacy or to avoid

the delays surrounding probate.

Trusts do not enjoy a separate legal personality as companies

do. A Trust is the legal relationship between three key persons:

The person transferring the legal title on the property

is referred to as the Settlor, the legal owner of the asset is the

Trustee, and the person receiving the asset and its benefits is

the Beneficiary.

THERE ARE MANY DIFFERENT KINDS OF PERSONAL TRUSTS BUT

THEY ALL FALL INTO ONE OF TWO CATEGORIES:

Inter vivos or Lifetime Trusts. These are created during the

Settlor’s lifetime in order to transfer property to beneficiaries

– typically family members and charities. These Trusts can

be further categorized as revocable and irrevocable. Revocable

Trusts can be changed or revoked during the Settlor’s lifetime

and are generally for the primary benefit of the Settlor during

that time. Irrevocable Trusts, on the other hand, generally

cannot be changed or revoked. A will only comes into effect

when a person passes away, but a revocable Trust established

during your lifetime can also help your family if you become

ill or unable to manage your assets.

Testamentary Trusts. These don’t become effective until after

the Settlor dies. Typically, they are part of the Settlor’s last

will and testament or arise under the terms of their revocable

management Trust after the Settlor’s death. One of the most

important decisions to make when setting up a personal Trust

is who will be the Trustee. Your Trustee must be a strong,

‘trust’-worthy professional with independent judgment. Whoever

| 107 |

A REVOCABLE TRUST ESTABLISHED DURING YOUR LIFETIME CAN ALSO HELP YOUR FAMILY IF YOU BECOME

ILL OR UNABLE TO MANAGE YOUR ASSETS ONE MAY SAFELY CONCLUDE THAT CYPRUS IS AT THE FOREFRONT

OF THE LEADING TRUST JURISDICTIONS AND AT THE CUTTING EDGE GLOBALLY

is chosen must be fiscally astute. Furthermore, multiple Trustees can be

designated to provide for the divergent interests to be

represented.

Cyprus is a hub for a significant number of High Net Worth Individuals,

whether residents on the island or not. It has a modern tax regime and

an extensive network of double taxation avoidance treaties, allowing for

effective tax planning. It has world-class professional and financial services

and a robust legal infrastructure founded on English Common Law.

Ten years after the enactment of the International Trusts Law of 2012, I

believe that one may safely conclude that Cyprus is at the forefront of the

leading Trust jurisdictions and at the cutting edge globally, with the most

favourable Trust regime in Europe, providing Settlors and Beneficiaries

alike with the highest possible level of protection, assurance and flexibility.

THE CYPRUS INTERNATIONAL TRUST IS DEFINED AS A TRUST IN RESPECT OF

WHICH:

• the Settlor (whether a natural or legal person) is not a resident of Cyprus

for the calendar year prior to the creation of the Trust;

• at least one of the Trustees is, during the whole duration of the Trust, a

resident of Cyprus; and

• no Beneficiary (whether a natural or legal person) other than a charitable

institution is a resident of Cyprus for the calendar year prior to the

creation of the Trust.

OTHER ADVANTAGES OF THE CYPRUS INTERNATIONAL TRUST:

1. Asset protection. Trusts ring-fence the Settlor’s assets against any

claims. Unless the Court is satisfied that the Trust was made with the

intent to defraud persons who were creditors of the Settlor at the time

when the payment or transfer of assets was made to the Trust, the Trust

will not be void or voidable. The burden of proof of the Settlor’s intent

to defraud lies with the person seeking to set aside the transfer and any

court action must commence no later than two years after the assets were

transferred to the Trust.

2. It establishes jurisdictional protection by providing that an International

Trust containing a Choice-of-Law clause in favour of Cyprus law

is fully protected from unfounded foreign judicial claims as a matter of

public policy.

3. It allows the Settlor of a Trust to reserve powers to himself,

to retain a beneficial interest in trust property, or to act as the

protector or enforcer of the Trust, without any legal consequence

on the validity of the Trust.

4. Cyprus International Trusts may be established with unlimited

duration.

5. It empowers Trustees to invest in movable and immovable

property both in Cyprus and overseas, including shares in

companies incorporated in Cyprus.

6. It provides for a uniform tax regime applicable to all persons on

the basis of a tax-residency test. In the case of a Beneficiary who is

resident in Cyprus, the worldwide income and profits of the Trust

are subject to Cyprus tax. In the case of a non-resident Beneficiary,

only income and profits earned from sources within Cyprus are

subject to Cyprus tax. Non-resident Beneficiaries will be subject to

Cyprus taxation only on any Cyprus-source income.

7. Trustee services offered in Cyprus, may be offered only by

especially licensed fiduciary providers, i.e. licensed lawyers,

accountants or CYSEC professionals. This offers extra professional

protection and assurance.

Life can be unpredictable. The world can be unpredictable. Creating

a Trust allows you to adapt your estate plans accordingly. Great

wealth can take many years to accumulate. The challenges to wealth

preservation are numerous, from ineligible beneficiaries, mismanagement

of assets and divorce to taxation and legal disputes. But

with sound planning, these challenges can be mitigated, if not eliminated.

By creating a Trust, you are putting in place a resilient plan

to take care of your family and loved ones when you are no longer

around or you lack the competence of being there yourself. Not

only can a Trust disentangle, clarify and facilitate asset distribution,

it can also help you leave an enduring financial legacy.

| 108 | ADVERTORIAL

A NEW MEANING OF LIFE

AT SEA WITH TRIDECK

The very quintessence of innovation,

Azimut Yachts’ first ever Trideck

superyacht defies the accepted norms

of boat design to create extraordinary

new spaces that redefine the concept

of onboard living.

With dimensions like never before

and a design that breaks all the rules,

the Grande Trideck is the magnificent

new Azimut Yachts flagship.

THREE DECKS ++ONE

Azimut Grande Trideck features a

new living area never seen before on

a yacht this size, the Sea View Terrace. The Sea View Terrace is an aft

raised “mezzanine” deck, which is the latest addition to the traditional

triple-decker. Thanks to this layout innovation, Grande Trideck offers

four terraces: the sundeck, perfect for secluded sunbathing, then the upper

deck, where we find the main Outdoor Dining Area, next, the new

Sea View Terrace, floating just a few meters above the water, and down

below, the full-height beach area. Furthermore, one additional benefit

of the aft raised “mezzanine” deck is the creation a Private Patio at the

entrance to the salon, perfect to enjoy a complete privacy.

| 109 |

THE STYLE IS

STREAMLINED,

FAVORS

THE PURITY

AND

CLEANLINESS

OF THE LINE

AND AT THE

SAME TIME

ENHANCES

THE

PERCEPTION

OF AN EVER

HIGHER

QUALITY

FOUR TERRACES REINVENT THE

WONDER OF LIFE AT SEA

Azimut Grande Trideck features a new living area never seen before

on a yacht this size, the Sea View Terrace. The Sea View Terrace is

an aft raised “mezzanine” deck, which is the latest addition to the

traditional triple-decker.

The innovative layout creates four terraces and a covered patio: the

sundeck , perfect for secluded sunbathing, then the upper deck,

home to the main Outdoor Dining Area, next, the stunning new

Sea View Terrace, suspended tantalizing above the water, and down

below, a full-height Beach Club area at sea level. The introduction

of the mezzanine creates space for an intimate sheltered Private Patio

nestled between the Sea View terrace and salon.

HERITAGE AND CRAFTMANSHIP

The interior design by Achille Salvagni reimagines the use of interior

spaces, leaving behind the traditional subdivisions to accommodate

a more natural way of experiencing life onboard. The style

is streamlined, favors the purity and cleanliness of the line and at

the same time enhances the perception of an ever higher quality.

OFFICIAL DEALER

Tel: (+357) 24639600

(+357) 99626993

e-mail: sales@bpyachting.com

Website: www.bpyachting.com

Locations: Limassol, Larnaca,

Ayia Napa, Beirut

| 110 | INTERVIEW

Emotional

Connections

Klitos Teklos, Senior Vice President, Global Creative Director at Estée Lauder Companies for

ORIGINS/ADF/ LAB SERIES, talks about the concrete jungle that made his dreams come true,

aesthetics, and the importance of being ahead of your time.

| 111 |

New York is, without doubt, one of the

most dynamic and diverse cities in the

world and a cultural hub celebrated by

many generations of artists. Entranced

by those big city lights, Klitos Teklos

let the audacity of his youth guide him

there, despite the fact that he had only

ever seen it in films and magazines.

There was not the slightest doubt in his

mind that he was doing the right thing

when he applied to study at the Pratt Institute in New York.

Teklos was lucky to experience both analogue and digital culture

when growing up, something that would ultimately shape his perception

and affect his creative persona. “The biggest contributing

factor in shaping me as a Creative Director was the duality of my

upbringing: having an analogue childhood and a digital adulthood.

The analogue part was all in Cyprus and, since computers were not a

thing at the time, I was exposed to nature, to

life experiences and human connections that

were real, simple and tangible,” he reminisces

and adds. “The digital part was the chapter that

came with my studies and made technology

and the world we live in today feel native and

progressive. Being able to tap into both universes

has given me an incredible advantage,

a unique lens and a level of open-mindedness

that I truly value. It gave me imagination, curiosity,

empathy, awareness and adaptability,

which are all needed to build a better foundation

and instinct for communication. I work in

an industry where you not only need to keep

up with the times, but you also need to be the

first and the best at it, so you have to nourish

that special skill that distinguishes you from

everybody else.”

When I ask Teklos to explain to me his mission,

I am taken by the romanticism and tenderness

of his words. He reveals a true artistic,

altruistic nature; that of a man who has a duty

to art and society first and puts himself last. “A

creative director is a storyteller – someone who

is able to combine artistic disciplines seamlessly

in order to convey messages and emotions,

create trends and desires, and transport the

mind and senses,” he explains. “In order to

do this successfully and at a global level, you

need to have exposure to the world, people and

culture. You cannot communicate and sell an

idea, object or service to people, if you don’t

have a way of understanding or connecting to

them. As I define the creative universe for multiple brands, I tend to

draw inspiration and influences from what I’m working on. It’s very

much like acting; you have to get into the headspace of the brand and

its possible audience. It’s very important, however, to leave your personal

taste to one side. If you are telling someone else’s story, it’s essential

to create content that drives their authentic voice, not yours.”

Teklos’ globetrotting infuses him with inspiration. He has travelled

extensively in the US, Latin America, Europe and Asia and has thus

been exposed to multiple cultures and most importantly, cultural

nuances. “Other sources of inspiration for me are films, music and

architecture – there’s truly beauty and interest in everything,” he says.

“You just have to be open and present.”

We are currently navigating very tumultuous times and observing

how many social anxieties are making their way onto sociopolitical

agendas: sustainability, climate change, women’s rights, body positivity,

the underrepresentation of people with disabilities and many

more. I am eager to know how these issues affect Teklos’ brand philosophy.

“Art and commerce have always reflected

the times we live in, from early paintings

and sculptures to current social media

posts,” he begins. “The people that go

A creative

director

is a

storyteller

In our

business,

the greatest

challenge is

to

continuously

be ahead

of your time

through these eco-socio-political anxieties,

uncertainties and social awakenings are the

same people that are asked to like images

and buy products. So companies, brands

and, subsequently, campaigns need to constantly

evolve and reflect what’s happening.

They must do it because they are responsible

for positive change through their

platforms and messaging. I have personally

made sustainability, equality, identity,

inclusion and diversity a big part of my

mission at the company. I have maximized

sustainability in packaging across all 11 of

my brands with great success and within a

very short amount of time. We have implemented

initiatives and partnerships to help

the environment by sourcing ingredients

responsibly, and by reducing waste and

material. I’m reflecting respect and representation

for all people, not only through

my teams but also through my campaigns.

I take very seriously that, with this kind of

power and influence, we must do our part

in order to make the world a more positive,

accepting and caring place. And this must

be done in a true and authentic way, otherwise

consumers can see right through it.”

At this point, I recall countless ads and cam-

| 112 | INTERVIEW

paigns fronted by well-known celebrities

and I am itching to ask about the importance

of celebrity endorsement of his

own brand campaigns. In reply, Teklos

is quick to clarify that, while a celebrity

face can fast-track awareness, it can only

do so if the timing is right and the face

is relevant and embodies a certain vibe

and value that works for the brand in

question. “It used to be that a celebrity

could make a brand or a product iconic

There’s

truly

beauty

and interest

in everything.

You just

have to be

open and

present

but that was back in the day when magazines

were the only source of fashion and

beauty information,” he explains.

“As technology has allowed unlimited

and oversaturated outlets of content, one

face – albeit a famous one – might not

be enough. Today, consumers are not

only savvy but they also have a very short

attention span. A campaign needs to

stand out and connect emotionally with

them at an even greater level, in order to

| 113 |

The lockdown forced us

to re-envision fragrance

and skincare through a digital lens

make them not only remember it but also

trigger a purchase.”

Klitos Teklos has collaborated with countless

brands across many industries and he

cherishes every step he has taken in his career

and everyone he has come across who

believed in his potential. As he notes, each

moment was another milestone on the road

to where he is today, helping him establish

himself as a force in the industry, an industry

where, he says, you are only as good

as your last project, so you have to outdo

yourself every time. “The greatest challenge

is to continuously be ahead of your time. A

new fragrance takes about two years from

concept to shelf. That means it needs to

resonate with people two years after you’ve

come up with it. But things change so

quickly, people change habits, likes and

dislikes a lot faster than ever before. Our

attention span is super-short, the world is

oversaturated and has gone through mental

and physical fatigue. So the concept

of being able to disrupt, stand out and

drive interest is on a whole other level,” he

warns. “Cultural and regional nuances are

also increasingly challenging as one thing

might work in the US but will not necessarily

work in China, so you have to be

well-versed in protecting the global image

of a brand, while making sure it resonates

at a local level. It all goes back to being

open, present and alert – it allows you to

be nimble, think on your feet and make the

necessary changes, depending on whatever

the universe throws your way.”

Indeed, when the COVID-19 pandemic

was thrown Teklos’ way, he did not cower.

On the contrary, he discovered that remote

work can be effective, productive and flexible,

opening possibilities for people to have

choices, a better work/life balance and for

all businesses to have more humanity in

their approach and reinvent their creativity.

“The lockdown forced us to re-envision fragrance

and skincare through a digital lens.

Products that are highly sensorial and are

meant to be experienced through scent and

touch had to work a lot harder with their

visuals, design and storytelling to make

up for the lack of being able to see and try

them in person. We made an impressive

pivot to cater to this, as self-care skyrocketed

during the pandemic and we needed to

make sure we met demand and delivered

exceptional work based on this new set of

parameters,” he recalls. “At my end, I made

sure that our work was not simply reactive

but properly conceptualized, well-thought

out and custom-designed for all digital platforms

without losing its essence. I do like

the fact that we found ways to use our work

and products to make people feel good and

enable their self-confidence and spirit, despite

the hard times.”

As human beings, of all ages and genders,

we have one thing in common; we are

emotional creatures. We connect with one

another through stories and emotions, we

carry them when we are uprooted from

somewhere, cherish them when we believe

in or choose to fight for something. If there

is one thing that Klitos Teklos is constantly

proving, it is that stories bring us together

and give us a once-in-a-lifetime chance to

carry a message around the world.

| 114 | TRUSTS

GENERATIONAL

PLANNING:

CYPRUS WILLS

AND TRUSTS

By Stelios Christophides,

Senior Lawyer,

George Z. Georgiou

And Associates LLC

Generational planning is the process of putting

in place the arrangements to ensure

that a person’s assets are passed in the manner

desired to that person’s family and others.

Whilst the figures range from country

to country, it is probably a fair estimate that at least half of

any European country’s population dies without leaving a

will. In many cases, this does not present an issue, where the

laws that apply to a person who dies without leaving a will

(intestate) may result in that person’s assets being passed to

the very persons (usually his immediate family) and in such

proportions as he would wish. However, it is also true that,

in many cases, the application of the intestacy laws can result

in an outcome that was neither envisaged by – nor would it

be deemed suitable in the eyes of – the deceased. Typically,

intestacy laws provide that the assets of the deceased pass

to his spouse and children in specified proportions. When

the deceased has no spouse or children, the assets might,

according to intestacy law, instead pass to his nearest living

relatives. In what situations would the outcome on the application

of intestacy law not be appropriate? Consider the

following scenario:

V is 60 years old and widowed. With his wife, who passed

away 3 years earlier, V has 3 children, X, Y and Z. X is aged

25, Y is 20 and Z is 14. V has accrued significant assets

totalling €6 million. V is the sole owner of all those assets.

Whilst X is a very responsible person who works diligently

and takes his personal and professional responsibilities seri-

IN MANY CASES, THE

APPLICATION OF THE

INTESTACY LAWS CAN RESULT

IN AN OUTCOME THAT WAS

NEITHER ENVISAGED BY –

NOR WOULD IT BE DEEMED

SUITABLE IN THE EYES OF –

THE DECEASED

| 115 |

TYPICALLY, INTESTACY LAWS PROVIDE THAT THE ASSETS OF THE DECEASED PASS

TO HIS SPOUSE AND CHILDREN IN SPECIFIED PROPORTIONS

ously, Y is considered by his father to be immature and irresponsible

– he seems to have become involved with the ‘wrong crowd’

and tends to fritter his money away unwisely and seldom plans for

the future. Z is still in full-time education and is a conscientious

student. Such a family dynamic is by no means uncommon and

variations on this theme are commonly encountered when advising

families looking to put a generational plan in place. So, what if V

has no will or other generation planning tool? To understand why

death without having left a valid will may be problematic, one

needs to consider the outcome upon the application on the law of

intestacy.

Who inherits his assets when he dies, in what proportion and

when? In Cyprus, the law provides for what is commonly called

‘forced heirship’, by which, on death, a person must leave a certain

portion of his assets to his family and in the proportions prescribed

by the law (irrespective of whether he died leaving a will or not

and irrespective of whether his will stipulates otherwise). So, V has

died without leaving a will and the Cyprus intestacy law applies. Its

forced heirship provisions require that where a person dies:

• leaving a spouse and child(ren) or no spouse but child(ren): No

more than 25% of the estate may be freely disposed of. The remaining

75% of the estate goes to the spouse/children.

• leaving a spouse only: No more than 50% of the estate may be

freely disposed of. The remaining 50% of the estate goes to the

spouse.

Therefore, V could only have freely dictated the terms of inheritance

of 25% of his estate even if he had left a will. If V died

without a will, his entire estate would be passed directly to his three

children in equal proportions (the portion reserved for Z, a minor,

would instead be held and applied for his/her benefit by the legal

guardian). In other words, the irresponsible and wasteful son, Y,

now immediately inherits a significant amount of assets (value €2

million) to do with as he pleases – not the situation V would have

ever wished for and, in his eyes, a recipe for disaster. If V had left a

will then he could have freely dictated the terms of inheritance in

relation to 25% of his estate and the 75% of his estate would have

to pass directly to his three children – still not ideal as Y would

still immediately receive assets worth €1.5 million (i.e. 1/3 of the

75%).

HOWEVER, IF V HAD SETTLED A CYPRUS TRUST DURING HIS LIFETIME,

HE COULD HAVE LEGITIMATELY TRANSFERRED UP TO ALL OF HIS

ASSETS INTO THE TRUST AND SET OUT THE PRECISE TERMS ON WHICH

EACH OF HIS CHILDREN WAS TO BENEFIT, IF AT ALL, FROM THESE

TRUST ASSETS. FOR EXAMPLE, HE MIGHT HAVE PROVIDED THAT:

• X, being the sensible sort, could receive an immediate payment

from the Trustee of, say, €500,000. Additional payments could

be made to X as and when the Trustee deemed appropriate or, alternatively,

the Trust could provide that amounts be paid to X at

specified periods.

• Y should only receive payments from the Trustee if the Trustee

was satisfied that such payments were to be used in a useful manner.

The terms of the Trust could provide for this by, for example,

requiring that Y produce a business plan if he was to request funds

for setting himself up in business. The Trustee could then evaluate

the business plan and decide, at his discretion, if it would be appropriate

to use Trust assets to fund that venture. Any other payments

out of the Trust could be stipulated in the Trust Deed as only

being made when the Trustee was satisfied that they would not be

used for wasteful purposes (e.g. gambled away or spent on friends

taking advantage of him and spending his new-found wealth in a

wasteful manner).

• Z could benefit by Trust assets being applied by the Trustee to

pay for his/her schooling and further education and living costs

if choosing to complete studies abroad. Once Z became of adult

age, the Trustee could decide how to apply Trust funds for his/her

benefit, depending on her circumstances and how he/she had developed

into adulthood.

The Trust terms could also allow for additional beneficiaries, for

example on the birth of any of V’s grandchildren and terms on how

such persons may benefit could also be stipulated in the Trust Deed

or even left to the complete discretion of the Trustee.

| 116 | INTERVIEW

LIVING THE

DREAM

George Kallis is a man who fell irrevocably, madly, deeply in love… with

music. He allowed it to engulf him and give birth to his artistic persona,

and it ultimately led him to Los Angeles, where he is now working as

a composer on successful movies, collaborating with major directors

and production companies. He keeps shooting for the moon and never

seems to miss. Here, he talks about the milestones in his career, the

Cyprus music/cinema industry and his own plans.

Cyprus and L.A. are 7,364 miles apart. How did

you end up there in the quest to realise your

dream?

It’s been quite a journey around the globe! After finishing

my national guard service, I moved to Boston

to study at Berklee College of Music and then returned to London

to complete my master’s degree at the Royal College of Music. I

found employment there as a composer’s assistant almost immediately

after graduation, which led to my first film score engagements

a few years later. In 2013, my wife and I decided to move to Los

Angeles and I was offered a green card for extraordinary ability in

the arts. This looked like the right option, since a lot of my work

had started coming from L.A. and work-wise this also suited my

wife also who is a post-production supervisor. Plus, we got to move

to a sunny city with an entertainment industry focus, so it is working

out great for us.

| 117 |

When did you start composing, and what or who were your early passions

and influences?

Growing up in Cyprus, my family was a big influence. I started studying

the piano at around 7-8 years and the violin a little later but, at 13, I decided

that I wanted nothing to do with music! I recall sitting at the piano,

upset because my piano skills were so limited and I couldn’t improvise as

freely as I wanted. Sometime later, with the support of my drama teachers

at The English School, I was given the opportunity to compose music and

songs for the school plays. Writing for theatre allowed me to be freely creative,

so I found my love for music again. At 16 I submitted my first song

to the national songwriting competition sponsored by Laiki Bank and I

won second prize. This gave me the confidence to write more and led to

a national prize in the Cyprus Folk Writing Competition with the song

Porizin and, a few years later, representing Cyprus at the Eurovision Song

Contest in 1999. The rest of my career has been mostly focused on scoring

for the visual media, which includes film/TV scoring and music for trailers

and advertising. My music influences ranged from Greek composers such

as Hadjidakis and Theodorakis to film composers like Miklόs Rόzsa, Vangelis,

Basil Poledouris and Jerry Goldsmith, to name a few. As a teenager,

I shifted into listening to heavy metal, following groups such as Black Sabbath,

Iron Maiden and Metallica, bands that I still listen to today!

You’ve worked with Disney, you won a Jerry Goldsmith Award for

Best Music for a Feature Film (for The Last Warrior), you recently

completed the score for First Love, a film starring Diane Kruger and

Hero Fiennes Tiffin, which is due for release this summer and you’ve

also worked for the popular After film franchise. What do you personally

consider to be the landmarks in your career?

The big first step was meeting the prolific music supervisor Graham

Walker who, after hearing my demo, really believed in my music and recommended

me for the first two films, Joy Division (Momentum Pictures)

and Highlander: The Source (Lionsgate). I still had to put the work in, to

receive the trust of the directors and producers but recommendations are all

we have in our industry. So, conducting a 90-piece orchestra for both films

was a dream come true. There have been a few other landmarks over the

years but a more recent one was working with Academy Award-winning

producer Nicolas Chartier (The Hurt Locker). Once I had started working

with director Castille Landon on the After series of films, I was told that he

was the executive producer. A week after I delivered the score for After Ever

Happy, I received a call from him. He explained how everyone was thrilled

with my scores and he wanted to recommend me to compose the music

for First Love. So, I am very happy that this introduction has led to a solid

long-term collaboration, since we will be working on a new film together

soon.

The relationship between music and other forms of art – such as video

art and cinema – has become increasingly important. How do you see

this relationship yourself and how far does music relate to other senses

than hearing alone?

Composers are also filmmakers, and the most successful music creators are

particularly sensitive to dramatic story. We are not simply writing a piece

for an action scene or a love scene. There is an arc that a composer needs

to follow in order to help the characters and the story come to life. Music

is so powerful that it can bring immediate identification or remembrance

for nearly anything it gets attached to. For example, Jaws would probably

not be as terrifying and iconic without that “dun dundun dun…” motif by

John Williams. But music can be extremely therapeutic, and serve as intervention

to accomplish physiological and neurological transformations too.

What does success and failure mean to you? Are these concepts firmly

linked to box office receipts and billboard rankings?

Today, I received literally the loveliest social media message “Your music

makes me feel better”. Surely, fanbase appreciation is the ultimate reward

for any artist and, of course, if it comes with box office success, that is the

full circle! But it is not all fun and games. Working in the film business and,

particularly, with other artists and creatives can lead to differences of opinion,

hard deadlines and very little sleep. As a composer, I am part of a large

team that consists of a director, editor, sound designer, producers, etc., and

we all come together for the best outcome of the film. But, to be perfectly

honest, I count my blessings that I can make a living doing what I love.

How would you describe the cinema/music industry in Cyprus?

From an artistic perspective, Cypriots are massively talented as people and

we have a collection of innovative filmmakers and musicians. I think that,

from a business and organizational perspective, there have been some great

things happening over the last few years, with a good competitive tax rebate

offered and productions from abroad are starting to take interest. So, my

hope is that, with new films being shot in Cyprus, the local crews are gaining

the training and experience that will allow them to handle more and

bigger films in the near future. During the pandemic, artists were the first

ones to be cut from various budgets. Ironically, this should not have been

happening since people need entertainment even more during difficult

times. I think that more effort from government bodies is needed to promote

film and music and to support artists locally, as well as to help them

lift their careers further internationally.

What are your main compositional challenges at this time?

I am working on a quite few things as I am preparing to fly to Cyprus for

five weeks to spend time with my family. I am taking my work with me

on a mobile music studio which I am currently setting up! There’s nothing

like scoring Hollywood films in Protaras! Work-wise, I’ve just signed a

publishing deal with BMG/Luminary for some of my film music tracks. I

am also working on two films. One is another Voltage Pictures production,

which I cannot yet reveal details about. The other is called The Rage and

is a survival thriller, produced by Ukrainian producers and shot in Russia.

Under the current circumstances, this was a difficult business deal to begin

with but we have finally moved ahead. The film is fantastic and is directed

by Dmitriy Dyachenko – we worked together on all the Disney The Last

Warrior films. The music consists of manipulated sound design elements;

for example, taking organic recordings like flute recorders or orchestral

solos and filtering them through various plug-ins to create a unique and

distinctive sound. Further to this, I have licensed some music for The Black

Phone and Black Adam trailers.

MUSIC IS SO POWERFUL

THAT IT CAN BRING

IMMEDIATE IDENTIFICATION

OR REMEMBRANCE FOR

NEARLY ANYTHING IT

GETS ATTACHED TO

| 118 | REAL ESTATE

HOW TO

BUY PROPERTY

IN CYPRUS WITH

CRYPTOCURRENCY

By Savvas Savvides – Lawyer, Partner,

Michael Kyprianou And Co LLC

Home listings are one of the most noticeable

ways in which cryptocurrency

is being used in real estate and it is a

strategy that is being used more and

more to generate greater interest in the

real estate market.

Given the growing popularity of

cryptocurrency in Cyprus, purchasing real estate using cryptocurrency

is a viable option in the current atmosphere.

Developers are already offering properties for sale in bitcoin,

which is becoming more common. It is now a reality that the

global trend for cryptocurrency is growing, and the number

of people willing to conduct transactions in crypto, or digital

money, is growing too. There is also the option to convert

cryptocurrency into fiat money for individuals who prefer to

accept payment in the traditional manner using euros or other

currencies.

The purchase and sale of real estate is carried out as a standard

transaction which appears as indicated below:

• The buyer collects all the papers required for the purchase of

the property;

• The lawyer progresses with all due diligence processes necessary

to check the legal status of the property to make certain

that it is free from any charges and/or encumbrances;

• An agreement is concluded between the purchaser and the

seller in which the seller’s crypto exchange account is indicated

in the agreement;

• The buyer transfers bitcoin or another type of cryptocurrency

through a system of smart contracts which operate on a

legal level in the EU;

• The seller receives a confirmation receipt;

• The deal is fixed; and

• The record of the change of owner is registered with the authorities,

such as the Land Registry Office, etc.

An immediate question that arises, is to how to convert the

cryptocurrency into cash or the local currency if the seller

does not wish to keep cryptocurrency. This can be achieved

in various ways, even if you hold on to your bitcoins or other

cryptocurrencies and sell them after several years.

THE TRANSFER OF CRYPTO BETWEEN WALLETS OR

ACCOUNTS THAT YOU OWN IS NOT TAXABLE

| 119 |

SINCE THE EU DIRECTIVES HAVE BEEN IMPLEMENTED, TRADING WITH CRYPTOCURRENCIES IN CYPRUS IS LEGALLY PERMITTED

Alternatively, if you do not wish to do this you can convert them

into cash as below:

• Use a cryptocurrency exchange. Some platforms allow users to sell

their bitcoins or other cryptocurrencies to other users. For example,

you can exchange your bitcoins for euros, US dollars or any other

fiat currency;

• Use Peer to Peer (P2P) exchanges that allow for the purchase and

sale of cryptocurrency online, which means you can deal with them

personally. However, if you choose to use this type of platform, you

need to ensure your safety/security;

• Use a cryptocurrency ATM. You can use a cryptocurrency ATM

to obtain physical cash. At present, cryptocurrency ATMs operate

in over 76 countries and, consequently, it is becoming easier. However,

bear in mind that not every cryptocurrency ATM allows you

to sell for local currency. In addition, ATMs have different buy and

sell units, supported coins and fees;

• Use a cryptocurrency debit card. While such a card may not provide

for the conversion of cryptocurrencies into cash, it does provide

a way to then spend your cryptocurrency. It works like a regular

debit card and you can buy services and products online and offline.

You can also withdraw cash from any ATM.

When it comes to the question of whether or not cryptocurrency

is taxable in Cyprus and whether you have to pay taxes when converting

cryptocurrency, it seems that Cyprus is in a more privileged

position than other European countries. The reason is that funds

deriving from Initial Coin Offerings (ICOs) are subject to taxes

in Cyprus since they are deemed to be taxable income. However,

Cyprus has one of the lowest and most attractive corporate tax rates

at 12.5% and this is its greatest advantage in comparison with any

another European country. The transfer of crypto between wallets

or accounts that you own is not taxable. You can transfer your own

original cost base and dates by accruing and tracking your potential

tax impact when you eventually sell.

Comparing Cyprus with Malta, the latter is popularly known as

a ‘blockchain island’ since it does not impose capital gains tax on

cryptocurrencies that have been held for a long time. There are, of

course, many other crypto-friendly countries in the world, including

Portugal, Switzerland (known for its incredible banking standards)

and Germany.

In Cyprus, the Prevention and Suppression of Money Laundering

and Terrorist Financing Law L188 (I)/2007, (the AML Law) was

amended through the L13 (I)/2021 (the Amending Law) to harmonize

domestic legislation with the provisions of the 4th and the 5th

AML Directives (Directives (EU) 2015/849 and 2018/843).

The 5th AML Directive made several amendments to the 4th AML

Directive (together the AML Directives) effectively extending AML/

CTF controls to the following:

• Providers of exchange services between virtual currencies and fiat

currencies (Exchange Providers); and

• Providers of custody services for virtual currencies (Custody Providers).

As a result of the amendments introduced by the 5th AML Directive,

EU Member States are required to ensure that Exchange Providers

and Custody Providers are registered, and the persons holding

management functions or who are the beneficiary owners of providers

are fit and proper. In Cyprus, the Cyprus Security and Exchange

Commission (CySEC) has been designated as the competent supervisory

authority for matters relating to crypto asset regulations and

has been provided with powers to regulate through directives. Since

the EU Directives have been implemented, trading with cryptocurrencies

in Cyprus is legally permitted. It is, therefore, safe to say that

trading with cryptocurrencies in Cyprus is conducted according to

the rules of general Civil Law.

Cryptocurrencies are a new trend that can easily be implemented

in property transactions and it is becoming increasingly popular

around the world. The property market has had to adapt so that

sales can also be made with cryptocurrency. One of the most important

pillars of the country’s economy, which will continue to be

considered as such, is the purchase and sale of properties. Consequently,

this adaptation was required and necessary. The most important

point to remember when investing in cryptocurrencies is to

consider your risk. You should also not forget to calculate the taxes

and fees that you will need to pay in order to take a wise financial

decision.

| 120 | WORK/LIFE BALANCE

| 121 |

Power

Couple

Sharing

a Single

Path

Gogo Alexandrinou,

Public Affairs

Advisor, Red Wolf PR

& Advertising Agency

and Charalambos

Prountzos, Managing

Partner, Prountzos

& Prountzos LLC/

EY Law, Law Leader

CESA Region at EY,

reveal how they

keep their bond

strong as they

balance challenging

careers with their

parental duties and

responsibilities.

Photos by

Michalis Kyprianou

Was it difficult at first to combine two careers and

two lives on one single path?

Charalambos Prountzos: When we met in 2008,

we were already both busy people, with our careers

going well. Our drive and ambition to be good at

what we do and to succeed was something that we

had in common. However, most important was our

mutual belief that ethics should always prevail in

our professional lives. This fundamental value has

guided us both throughout our professional careers.

For the first couple of years, combining our personal

and professional life was easy. However, in 2009 our

first daughter, Maria, came along and obviously this

changed our lives. At that point, I took the most

critical decision in my professional career: to start

my own law firm. Actually, it was a decision that we

took together, despite the risks that came with it.

We felt that, if I didn’t make the move then, there

was a risk of leaning towards certainty instead of

realising our full potential. We admire each other,

believe in each other and this has been a basic element

of our relationship.

Have you always divided up household responsibilities?

Gogo Alexandrinou: Over the years, we have supported

each other in critical career decisions and at

certain junctures when one took on more responsibilities

than the other. For instance, when I became

the main TV news anchor on the state channel,

CyBC, Charalambos gave me his full support. Then

I supported him when he took over the Law Leader

role for EY in the CESA Region, which entailed

extensive travel abroad. And he did the same for me

when I spent a full year setting up the first digital

TV channel in Cyprus. We have had a lot of help

from our families but the truth is that it has been extremely

difficult on many occasions to balance career

and personal time as we are both perfectionists and

fully committed.

Does the fact

that you are

both in a senior

position make your

marriage different from

how it would have been if

only one of you had such a

role?

C.P.: Possibly it does. Each couple has

THERE IS

EQUALITY AND

A UNITED FRONT

AT HOME –

GOGO

ALEXANDRINOU

its own

balance and codes of communication.

There are

partners who feel comfortable with having a role in the

background, focusing more on the family and the home and

that’s perfectly fine. For us, it was important to accept each

other as we were. And our careers were part of who we were

and what we wanted to be. It was never about money – that

was also common between us. It was about doing the right

thing and doing it right. Now, we are both fine with the idea

of stepping back at times to focus on our family and on each

other. We know it is an important period for our children and,

for us, they are the top priority. But our children have shown

great maturity and understanding and we are now prioritizing

better than we did in the early years of our life together.

Are your roles at home identical or do they complement

each other?

G.A.: There is equality and a united front at home. Charalambos

is a big advocate of gender balance and diversity and his

approach to family matters could not have been different. He

wouldn’t be able to do differently with three opinionated ladies

in the house! I am usually more strict in terms of setting

limits and ensuring that our children contribute to housework.

Charalambos is, by nature, more calm and less strict but he

always supports me when difficult conversations need to take

place. However, when he gets serious, they both know they‘ve

done something seriously wrong! We are both in favour of

having a transparent relationship with our kids. We want them

WE ADMIRE EACH

OTHER, BELIEVE IN

EACH OTHER AND

THIS HAS BEEN A

BASIC ELEMENT OF

OUR RELATIONSHIP

– CHARALAMBOS

PROUNTZOS

to feel able to share anything with us and speak openly about

anything that comes to their minds.

Do you both understand the challenges of your partner’s

career? How important is it to support your partner’s career

and feel that you are similarly supported?

C.P.: To a very large extent, yes but even if we do not know

the individual details, we understand that it is demanding and

sometimes has suffocating deadlines. For this reason, I find it

important to show (and have) support as it removes extra stress

from your partner. The stress of work is enough, there is no

need to complain about the hours of absence, travelling, business

meetings outside working hours.

G.A.: For me it is vital to have support from my partner. He is

a driving force but at the same time I consider him an objective

and strict judge – so I trust him and I want his opinion!

How do you manage to make time for each other?

C.P.: With two kids and our demanding careers, it’s pretty hard

but we work around it! Contemporary couples face challenges in

finding time for one another. We have discovered a few ’strategies’

to spend more time together, such as having coffee early

in the morning after the kids go to school or arranging a ‘date’

when they are attending after-school activities. It might just be

an hour but it’s the quality and not the quantity that counts.

Have you ever had to choose between accepting a new position

and maintaining your home life?

G.A.: Yes and it was not a difficult decision. My priority is my

family and my kids. When I was younger, I had a different

mindset and, in the past, I did sacrifice balance in the pursuit of

a career. Now, I have taken a few steps back as I want to be fully

present.

| 123 |

Art

For

Art’s

Sake

No

matter

how confusing

and terrifying the

times, we will always

have – and need – art. This is its

ultimate power and what makes works

of art timelessly beautiful and essential. It is no

exaggeration to state that galleries act as vessels of

communication between the artists and the public; they are

the beating heart of the world of art.

On the following pages, four gallery owners

discuss the importance of investing in art and

enjoying it for its own sake.

Photos by TASPHO And

Michalis Kyprianou

| 124 | ART

Apocalypse Gallery, Nicosia

“Art has

always

had an

investment

value”

| 125 |

‘S

erendipity’ might be the best word to

explain how Natasa Tofaridou became

the Founder & Manager of Apocalypse

Gallery, which started its operations in

1987.

“Art was always very close to my heart,

although I studied at the Athens University

of Economics and Business,”

she reminisces before describing her

entrepreneurial journey as an adventure.

“Setting up this peculiar ‘job’

was not exactly the easiest task. I spent

countless hours studying the work of

Cypriot painters, I learned about their

different techniques and styles and

then I started writing letters, inviting

them to take part in exhibitions. I also

organized some solo exhibitions in

Athens, mainly of Cypriot artists who

were living there at the time.”

Tofaridou goes on to explain how she

had set some unyielding principles for

the gallery’s operation: she would stay

true to her promises, there would be

consistency in payments and the gallery’s

priority would be the promotion

of high-quality exhibitions and artists.

“Managing such a space is by no means

easy,” she says. “It may seem so but it is

not. First of all, the gallery space needs

to be sustainable and you are the one who needs to achieve this. You

have to manage and make wise exhibition choices; you need to chase

and host events so that the space remains alive, relevant and open;

and finally, you have to be ready to deal with situations that affect

the arts.”

Natasa Tofaridou is aware that art is, inescapably, a product of its

time and the freedom of unfettered art can never be absolute, either

due to socioeconomic or political reasons and restrictions. She

closely observes developments on the Cypriot and international art

scenes, always on the lookout for any gems that come her way.

“As a sensitive sector, the arts will always be affected by economic

and political turbulence and all kinds of events taking place internationally.

Art is always the first to feel

these shocks and be influenced either

positively or negatively. I would say

that, where art is concerned, we experienced

a ‘golden age’ until 2010,

as there was interest in – and love

and demand for – art in general.”

She goes on to explain that, in the

international arena of luxury investments

and on the stock market,

art has the potential to bring huge

returns. “Art has always had an investment

value,” she admits candidly.

“Of course, as in any area of investment,

the interested parties need

to conduct their research diligently

and not make random purchases.

As far as Cypriot contemporary art

is concerned, the work of the artists

who defined the genre – Christoforos

Savva, Adamantios Diamantis,

Solomos Frangoulides, Michalis

Kashialos, Telemachos Kanthos,

Ioannis Kissonergis, Stass Paraskos,

Lefteris Economou and others who

are no longer alive – certainly has

investment value. Of course, there are

living second-generation artists that

one can invest in, too. When it comes

to younger artists, a collector should

keep an eye on their development,

their studies and their consistency in

the field. It is also important to note

that there are now important Greek

artists who have a strong presence on

international art exchanges.”

Tofaridou sets no red lines when it

comes to the style of the artists she

works with. As she explains, quality

has no specific style and can be found

in figurative, conceptual or abstract art. “Of course, there are specific

trends at various times which attract buyers and let’s not forget that

the element of mimicry is always lurking. In the past, it was an element

that could determine sales. However, I believe that, especially

since the 2013 crisis, there has been a greater demand for contemporary

works with a fluid style with abstract elements and image distortion.”

Natasa Tofaridou is proud of Apocalypse Gallery’s artistic ride,

which has continued for more than 30 years. “We have held unique

and beautiful exhibitions, we use history as our compass and move

into the new era with renewed power,” she says with great optimism.

“Don’t forget that art is to be lived.”

THE ARTS

WILL ALWAYS

BE AFFECTED

BY ECONOMIC

AND POLITICAL

TURBULENCE

AND ALL KINDS

OF EVENTS

TAKING PLACE

INTERNATIONALLY

Don’t

forget

that

art

is

to be

lived

| 126 | ART FAMILY MATTERS

| 127 |

Bluchip Gallery, Larnaca

“The first rule

of buying art:

buy what

you like!”

been a collector for most of my life. Having studied

Fine Art & Graphic Design, I have always had an

eye for and a passion for art.”

James Demetriou, owner and director of Bluchip Gallery,

consciously chose to live a life in art. As a gallerist

and a man who devoted his time to study the subject

of Art academically as well, he has engaged himself in

‘Ihave

an endless artistic journey that continues to move upwards

and forwards through the operation of his own gallery.

“Bluchip gallery has been evolving since we opened our doors back in

2018. From a stand-alone gallery, we are moving towards displaying our

works for sale in other venues to give more people a chance to see the

works in situ, such as in both Radisson Hotels and The Indigo Hotel in

Larnaca and, of course, in the QBlu Plaza where the gallery is currently

situated,” he says and adds, “Managing and owning a gallery can be a challenging

and interesting occupation. Meeting people from all walks of life

who have a common love or passion – art, whether it be to beautify their

homes and offices or as an investment. I enjoy the diversity. Art, for me,

is the purest form of expression. As they say, ‘A picture paints a thousand

words’.”

Demetriou cherishes the unique relationship that he forms with each artist

through their collaboration. When art pulls people together, the connection

is electric and lasts for life. “Seeing Bluchip’s international artists and

their work develop over the years and gaining worldwide recognition has

been very rewarding. Even to be a tiny part of this makes you feel proud,

privileged and extremely happy for them,” he says affectionately. “It is

very hard to choose favourites but, if I must, Remi Rough is one of them.

Watching his evolution from graffiti artist to more abstract contemporary

works has been a privilege. Another favourite piece is

“Morons” by Banksy – I love the irony – and Matt

Small’s “Patricia” will be dearly missed when she’s

gone! Works by Faile, as well as Spanos’ amazing

metal sculptures are also some of my favourite works

in Bluchip.”

Bluchip Gallery primarily deals in world-renowned

urban contemporary artists that have an international

track record of consistent sales and international

market value. The gallery has also been involved in

investing in new up-and-coming local artists and

introducing them to worldwide markets, as well as

offering art consultancy services, helping clients build

their portfolio according to their specific taste, needs and budget.

Demetriou is quick to outline the basic principles for investing in art and,

unsurprisingly, what comes first is the individual’s personal spiritual hunger

and the emotions evoked by the untranslatable works. “The first rule

of buying art: buy what you like!” he says. “If the piece says something to

you, inspires you in some way, or just brings back happy memories, then

that’s the one for you. Always do your due diligence on any artist you are

interested in. There are many sites and auction houses that will show you

an artist’s track record regarding past sales and pricing. Speak to reputable

dealers and galleries. Provenance is key for current and future values.”

He is quick to add that art is an investment that can be enjoyed every single

day. “You can freely choose how long a term you are looking to invest

for. For example, you could invest in a blue-chip artist such as Banksy,

where going by track records, you have a very good chance of making a

quick buck in the medium to short term but in the long term, too” he

notes. “Or you may choose to go for an up-and-coming artist whose work

is being sold by a reputable gallery at relatively low prices, giving you a

chance of making good on your investment, probably over a longer term.

The international art market is growing so there are many outlets ready

to take your piece in and sell it for you, or you can go straight to auction

yourself. Artworks very rarely drop in value; art investments over the last

10-15 years have outdone many others, with a steady longer-term yield

and capital gain.”

Demetriou is totally in sync with developments around him; he sees

change and adapts accordingly but he does not let it dictate his ways; he

marches to his own drum. “Since the rapid development of the Internet,

the art market has been blown wide open!” he says. “Especially with the

latest NFT phenomena. You no longer need to go to a physical space or

an auction house to see the artworks. Everything

can be done from your own private space. The

online market for art has been flourishing and expanding

for years and many galleries and auction

Provenance

is key for

current

and future

values

houses now exist purely online. Obviously, you

can never replace being physically there in front of

the piece, but it does come a close second with the

technology available today.”

Demetriou’s future plans include free art tours of

all the works available on display, and the curation

of more shows by both local and international

artists, all part of his endeavour to convey the tangible

and intangible value of art.

| 128 | ART

| 129 |

Golden Gallery by Kapatays, Nicosia

in art

is a serious business,

given the

amounts spent

on art globally.

Investors and collectors

must be

‘Investing

always cautious

and alert, since investing in art is

like investing in the stock exchange.

There are definitely some golden

rules to be followed,” says Andreas

Kapatays, owner of Golden Gallery

by Kapatays, and he elucidates:

“Firstly, authenticity. The collector

must investigate with the help of a

trustworthy dealer, through museum

listings or established galleries,

the authenticity of the artwork, to

become familiar with the necessary

information, concerning provenance

and possible auction history. Another

factor which must be taken into

account is the international career

of the artist, which applies to both

established and upcoming artists.

Collaboration with the right gallerist

is another key factor, since he or she

must be knowledgeable and aware of

the international art scene to be able

to spot the right artist and the right investment, at the right time, for each

customer.”

As he explains, given the fact that one has invested in high art, besides

its aesthetic value, there is always the benefit of liquidity. “At any point,

the artwork can be sold through galleries, auction houses or private sales,

providing a substantial return, usually in the minimum time. The return

percentage is around 10% every two years,” he explains.

Kapatays’ journey in the fascinating world of art began when he was a

child. Surrounded by art lovers and exposed to the vividness

of art and those who created it from very early

on, it was inevitable that he would delve into this industry.

“My grandfather was one of the first importers

and wholesalers of frames in Cyprus,” he explains. “So,

due to the family business, I had the chance to meet artists

and grow fascinated with art from a very young age.

At 16 I purchased my first original artwork, now part of

my private collection, from Cypriot artist Stelios Votsis

and, from then on, I developed a professional interest in

this field.”

Kapatays values the thrill he feels when he comes across

a new work of art. After all, as he points out, in order

“When

investing

in art,

there are

definitely

some

golden

rules to be

followed”

to begin a collaboration and

promote an artist, the art should

serve his soul and the artist

should also exude a similar aura.

“To begin a collaboration with

an artist, I first have to aesthetically

approve of the artist

and find a liking for his or her

art, otherwise it is impossible

for me to exhibit their work. I

look for a certain level of artistic

quality, both technically and

conceptually, the depth of their

work, the meanings that their

work wants to express, their

academic background and their

overall potential,” he enthuses.

“Equally important for me is

to feel that there is a beautiful

chemistry between the artist and

myself. Among my favourite

artists, whose art is part of my

private collection, are Alekos

Fassianos, Costas Tsoclis, Pavlos,

Kostas Varotsos, Yiannis

Gaitis, George Lappas, Andreas

Charalambides, Yiannis Stylianides

and many more.”

Kapatays considers technology

to be a useful ally of many

professionals, including those in the art sector. The online world, he says,

offers a platform that enhances and helps exhibiting and promoting art to

a greater audience, thus making art accessible to people who cannot visit a

gallery or a museum. “However, when it comes to serious art collecting, I

personally believe that a collector must have an ‘up close’ experience of the

artwork so that he or she can develop a personal and direct dialogue, for the

right decision to be taken,” he admits candidly.

Kapatays is a restless man and he does not place limits on where art can

get him. “Golden Gallery by Kapatays offers a

high level of good investment art for all budgets,

quality services, including consulting and collection

management, and above all, we aim to build

Investing in

art is a serious

business, given

the amounts

spent on art

globally

interpersonal relationships with our customers,” he

says and adds. “Our goal is to promote culture and

satisfy all who those have supported our efforts in

the art world of Cyprus and abroad throughout the

years. Our future plans include the expansion of

our galleries locally and abroad, as we aim to continue

to offer to our audience high-level exhibitions

and art.”

| 130 | ART FAMILY MATTERS

Elena

Christodoulides

Melina

Demetriou

Anthi

Kalavanas

James

Christoforou

Alpha C.K. Art Gallery, Nicosia

“Buying art

is a personal

and emotional

decision”

| 131 |

Alpha C.K. Art

Gallery was

founded in 2013

and specializes

in the curation,

promotion,

trade and valuation

of contemporary

Greek

and Cypriot fine

art. The four

directors – Elena Christodoulides, James Christoforou,

Melina Demetriou and Anthi Kalavanas – are

passionate about art, with academic credentials in

the field, and many years of professional experience.

“We have curated, organized and presented hundreds

of exhibitions, fine art auctions and charity

art events,” says Kalavanas. “The Gallery currently

represents over fifty Greek and Cypriot professional

artists and its principals maintain professional and

personal relations with many artists, curators, art critics

and historians, and other fine art professionals”.

Art speaks of the ultimate depths and working

with creative individuals is definitely not for the

faint-hearted. As Christodoulides explains, when

considering artists to represent, the team evaluates

their academic qualifications and professional

achievements such as exhibitions and placements

in collections, as well as a wide range of intangible

criteria, including the artist’s creative skill and imagination,

how inspiring and meaningful their art is,

and the emotion it provokes. “We trust our own aesthetic

appraisal and intuitive reaction to the artwork,

while trying to appraise the cultural and historical

significance of artists and their work,” she says.

“Buying art is a personal and emotional decision”

adds Christoforou. “Even if investing in art is the

primary objective, you should buy an artwork that

you love and want to live with. Trust your personal

aesthetics,” he says in a passionate plea. “Buy quality

and uniqueness; artists show their best art on the

biggest stages – museums, galleries, and art spaces.

Study the artist and their work. Seek expert advice

and opinions. Consider pricing relative to the artist’s

career level, professional accomplishments, and prospects.

Don’t ignore the potential risks and know that

art is a long-term investment.”

If we let the numbers do the talking, according to

the 2021 Art Basel & UBS Report, an estimated

167,349 Ultra High Net Worth Individuals around

the world are important consumers in the luxury

We trust

our own

aesthetic

appraisal

and

intuitive

reaction

to the

artwork,

while

trying to

appraise the

cultural

and

historical

significance

of artists

and their

work

Art has

long been

viewed

as an

alternative

asset class

market, as art is considered to be a valuable

alternative form of investment. “Art has long

been viewed as an alternative asset class”

Demetriou admits candidly. “It is a tangible

asset that is widely and easily accessible and

affordable. Fine art’s value can appreciate

over time, the art market has less volatility

and fluctuation than other financial markets

and, in high inflationary periods, such as we

are currently experiencing, it can be a good

hedge against inflation. Art offers the value

of personal enjoyment; it is an asset that can

be appreciated and displayed.”

It can’t be denied that art does not exist

independently of the social connections

in which it is embedded but extends into

the social realm, through its effect on society

and collective cultural identity. And

although the digital world’s domination is

growing day by day, Christodoulides believes

that the human transaction around art

is not dead yet.

“While the pandemic confirmed that art

buyers have a considerable willingness to

purchase online, they still prefer to transact

with art dealers, and galleries continue to

be their primary and most trusted source

for buying art. The best strategy for us,

therefore, is to maintain a strong physical

presence and develop strong digital sales

and promotional channels,” she says and

adds, “The two factors we feel will drive the

digitization of the art business in the coming

years are the increasing influence of millennials

and the growing interest in crypto art

and non-fungible tokens (NFTs).”

Quality and uniqueness, authenticity and

provenance, knowledge and transparency.

These are the selling points and values that

guide the four directors as they seek to preserve

and safeguard the gallery’s status and

high level of quality and enable them to

discover new talent with collectible significance.

“We will continue to showcase quality

art, respect our clients, support our artists

and care for our community,” Melina Demetriou

says tenderly. “These principles have

helped us build a successful gallery, earned

us a leading position in the market, given

us the foundation to persist during difficult

times and rewarded us with many successes.”

| 132 | INVESTMENT

REAL ESTATE

OPPORTUNITIES:

LONDON AS AN

INTERNATIONAL

INVESTMENT

DESTINATION

By Marios Hajiroussos,

CEO, Consulco Group

As

London emerges from its

COVID-19-enforced hibernation,

we can now examine its

prospects as an international

investment destination. Whilst

there are certainly headwinds

that might dampen growth,

London’s resilience, transparency and liquidity will ensure its continued

success in attracting international capital.

Although forecasts for GDP growth are muted, the UK economy

is likely to outperform the EU economy over the next two years.

With more workers returning to their offices and visitor numbers

picking up, London’s buzz has returned. Theatres are busy, restaurants

are full and hotels are charging premium rates in the face

of high demand. In June, as the city and the country prepared to

celebrate the Queen’s platinum jubilee, Regent Street and Oxford

Street were bedecked with union flags, adding to the carnival feel.

The hospitality sector was braced for its busiest period (over a

four-day bank holiday) since pre-COVID-19 times.

Infrastructure projects continue to enhance the city, moving London

forward. In May this year, the long-awaited Elizabeth Line

finally opened. This is a new underground railway line that will

link Reading in the west with Heathrow, the West End, the City,

Canary Wharf and suburban Essex in the east. Unlike the existing

tube network, the Elizabeth Line benefits from full size carriages

– with each train over 200m long. The line has dramatically

improved connectivity across and through central London

and brings a further 1.5 million people within 45 minutes of

the central business zone. This project has already encouraged

the construction of over 1,000,000 square feet of prime office

accommodation around Paddington, Tottenham Court Road,

and Farringdon – with more due to be completed this year.

Despite recent tough times, punctuated by draconian lockdowns,

values for prime commercial property have remained

stable, demonstrating once again the city’s resilience in unprecedented

times. After an initial sharp decline, values and

rents for residential property have quickly recovered, both

rising above their pre-COVID-19 levels.

Although it may seem counter-intuitive, demand for office

space – particularly from major occupiers – continues to support

rental values in prime locations. Companies need to offer

their staff a high-quality working environment to tempt them

back to the office, to retain staff and to attract new employees.

This entails a modern office, with multiple amenities (such as

showers and cycle racks), which meets/exceeds required levels

of energy efficiency and is fit for the next 10 to 15 years.

Despite the pandemic, the war in Ukraine and rising inflation,

prime London residential property is set to enjoy five

years of growth – both rental and capital. Furthermore, values

for prime London offices and retail units are also forecast to

| 133 |

LONG-TERM GLOBAL INVESTORS SEE LONDON’S POSITION BETWEEN ASIA AND THE US, ITS UNIVERSAL LANGUAGE AND

ITS DIVORCE FROM THE EU AS POSITIVE ATTRIBUTES

RESIDENTIAL SALES

PRICE GROWTH

FORECAST 2022 2023 2024 2025 2026

5 YEAR

COMULATIVE

Prime Central London 3.50% 6.00% 5.00% 3.00% 3.00% 22.21%

Prime Outer London 4.00% 3.00% 3.00% 2.50% 2.50% 15.92%

UK 5.50% 2.50% 2.00% 3.00% 3.00% 17.02%

RESIDENTIAL SALES

PRICE GROWTH

FORECAST 2022 2023 2024 2025 2026

5 YEAR

COMULATIVE

Prime Central London 8.00% 3.50% 3.50% 3.00% 3.00% 22.74%

Prime Outer London 5.00% 3.50% 3.50% 3.00% 3.00% 19.33%

UK 4.00% 3.50% 3.00% 3.00% 2.50% 17.05%

SOURCE: KNIGHT FRANK: UK RESIDENTIAL FORECASTS - APRIL 2022

SAVILLS FORECAST

ANNUALISED RETURNS

2022-2026

INCOME

RETURN

CAPITAL

RETURN

TOTAL

RETURN

Central London Retail 2.80% 3.90% 6.70%

London Offices 4.00% 2.70% 6.70%

SOURCE: SAVILLS- UK CROSS SECTOR OUTLOOK - 2022

EUROPEAN COMMISSION

GDP GROWTH YOY 2021 2022 2023

Cyprus 0.00% 2.30% 3.50%

EU 0.00% 2.70% 2.30%

UK 0.00% 4.10% 1.50%

YE 2021 YE 2022 YE 2023

Cyprus 100.00 102.30 105.88

GDP GROWTH

EU 100.00 102.70 105.06

UK 100.00 104.10 105.66

Cyprus EU UK

107.00

106.00

105.00

104.00

103.00

102.00

101.00

100.00

106.00

105.00

104.00

103.00

102.00

101.00

100.00

YE 2021 YE 2022 YE 2023

GDP GROWTH

EU

UK

YE 2021 YE 2022 YE 2023

rise during 2022, with both providing income and capital growth.

Long-term global investors see London’s position between Asia and the US,

its universal language and its divorce from the EU as positive attributes,

which they believe will drive performance over the next 20

years. Not surprisingly then, sovereign wealth funds, insurance

companies and pension funds have all been active in the property

investment market over the past 12 months, maintaining

prime yields at their pre-pandemic levels.

Of course, London is not immune to the COVID-19 hangover

of rising prices, staff shortages and resurgent inflation. It

is likely that interest rates will continue to rise as the Bank of

England attempts to tame the inflationary pressures and, for

many residents, the cost-of-living crisis is real. The hospitality

sector and the building industry are already facing rising staff

costs and more expensive raw materials – and no doubt this

trend will seep into other areas of the economy. We are not

complacent about this threat and our London Credit and

Property Investments Products have traditionally been good

hedges against inflation.

So, how can we protect our savings and take advantage of London’s

medium-term growth potential?

As we look forward it is important to remember that London

swiftly recovered from the 9/11 shock, the global financial

crisis, political instability and the Brexit vote. We expect its

resilience to ensure once again that it not only recovers from

COVID-19 and Brexit but will continue as a leading international

investment destination.

As Cypriots living in a small country, it is natural to consider

investing a proportion of our wealth abroad and London continues

to offer good medium- to long-term prospects. But,

before you do so, please talk to our specialists who can deal

with these tough questions and take the emotion out of investing

in property abroad.


the uk

is here

to help

When the UK announced its intention to leave the EU in 2016, hardly a day went by

without eminent media outlets predicting that the end was nigh: The UK would collapse

under the weight of its financial isolation, while the EU would have to deal with a

terrible precedent or see the most ambitious modern socio-political experiment fail

monumentally. Of course, the doomsday scenarios did not come to pass. In May 2022,

under the auspices of the British High Commissioner to Cyprus, members of the Cyprus-

UK Business Association met with Her Majesty’s Trade Commissioner for Europe, Chris

Barton CMG, to discuss the post-Brexit trade and investment climate between the two

countries and examine future opportunities.

Photos by TASPHO

Above the Nicosia residence of the outgoing

British High Commissioner, Stephen Lillie

CMG, graphite-grey clouds had gathered on

an unseasonably windy day for the end of

May to form a real English sky. The High

Commissioner had agreed to host a meeting

of minds between members of the Cyprus-UK

Business Association and Her Maj-


esty’s Trade Commissioner for

Europe, Chris Barton CMG.

Barton is only the third person

to be appointed to that specific

post and, since 2021, his mandate

has been to work closely

with the country’s wider diplomatic

network and lead a

coordinated effort to continue

the UK’s legacy of open trade

after the divorce from the EU.

He was the first to arrive as the

members of the Cyprus-UK

Business Association gradually

took their allocated seats at

the dining table overlooking

the bright green garden. Silver

plates with shortbread and

mince pies were dotted across

the table; coffee and tea were

served.

Three centuries ago, Britain

was arguably the most dominant

trading empire on the

Old Continent. While others

were still trying to expand territorially,

Britain was building

a large network of merchants

and manufacturers. There are

even some theories that suggest

that trading in coffee and

tea from Asia – caffeine being

the most potent productivity

drug – was the springboard of

the industrial revolution.

Back to 2022, where Chris

Barton was hailing the benefits

of free trade as a driver

of economic growth and job

creation, as well as improving

living standards. “These

are important at any stage,

but doubly important at the

given moment for at least

two reasons,” he said. Those

reasons, he added, involve the

wider objectives related to the

shared global political agenda

to cut down carbon emissions

and the role that trade and

investments play in deepening

personal, cultural and political

connections.

Androulla Pittas, founding

partner of corporate services

company Avantium and Honorary

President of the Association,

observed that Cyprus

companies and consumers had

remained loyal to UK brands.

“However,” she stressed,

“from my experience with

“IF THERE ARE THINGS

THAT WE CAN DO TO

FACILITATE AND GROW

THE UK-CYPRUS TRADE

AND INVESTMENT

RELATIONSHIP, THERE’S

A DEEPLY STRONG

COMMITMENT FROM

THE UK GOVERNMENT

TO SEE THAT HAPPEN”

CHRIS BARTON

our clients, they have experienced

a lot of practical difficulties.”

Christina Jacovides has had to

deal first-hand with post-Brexit

problems. The Vice-President of

the Association, who is Finance

Manager of MSJacovides Group,

a company that distributes pharmaceutical

and wellness products,

told the gathering about major

issues with product releases, due

to the increased administrative

burden. “There’s a lot of paperwork;

there are inspections both

at the manufacturer’s and the

distributor’s sites that cause more

delays,” she explained. “If routes

are quarantined and we’re waiting

for an inspection, we’re losing

valuable time.” Add to that shipment

delays, the sudden addition

of VAT, custom duties and, in

some cases, tariffs and the picture

becomes even bleaker. To offset

some of these issues, many British

businesses have started looking to

rent warehouse space in the EU.

In 2021, for example, the Netherlands

Foreign Investment Agency

announced that half of the 500

global firms that were considering

investing in the country because

of Brexit were UK companies –

among them, all the Big Pharma

boys. However, since many smaller

British companies did not have

the financial muscle to invest in

distribution networks in the EU,

a broad spectrum of products was

left behind.

“Also, even though supply

chain blockages are a worldwide

phenomenon, we are facing an

approximately 10% increase in

freight costs, which is affecting

our goods and our competitiveness,”

Jacovides noted. “It would

be good to get better prices on

freight or shipment routes from

the UK to Cyprus. There is a

strong demand for UK products

and we would like to keep this

business but, if the high costs

continue, we’ll have to reassess the

situation.” This was not stated as

an ultimatum but, rather, as an

unavoidable conclusion.

When talk turned to investments

and the export of business services,

the picture took a turn

for the better. The Association’s

Treasurer, Michael Tannousis,

who is Consulco’s Director of

Investment Services, said that

more and more Cypriot investors

are looking to obtain London real

estate, even in the face of Brexit,

COVID-19 and now, Russia,

trying to bully the West out of

Ukraine by turning off its gas supply.

“They are taking advantage of

London’s maturity and liquidity,”

he said and stressed that taxes are

paid in Cyprus to illustrate that

both economies are benefiting

from UK real estate investment.

On the issue of professional services,

he said, “We were worried

about financial passporting and

there are still some grey areas

with the FCA regulations, but,

as of today, regulated funds have

not been impacted negatively by

Brexit.”

“It is very difficult to isolate the

impact of Brexit, given current

events,” added the Association’s

President, Marios Andreou, a

Partner at PwC Cyprus. “And it

would be useful if a big UK bank

decided to set up their offices

here,” Pittas chimed in.

Positive developments have also

been observed in the higher education

sector. According to Panik-


“WE WOULD LIKE

TO KEEP THIS BUSINESS BUT,

IF THE HIGH COSTS CONTINUE,

WE’LL HAVE TO REASSESS

THE SITUATION”

CHRISTINA JACOVIDES

kos Poutziouris, Rector of UCLan and a

member of the Association, the absence

of an agreement between the UK and

Horizon Europe – the EU’s key funding

programme for research and innovation

with a €95.5 billion budget – has created

uncertainty among British universities

on their eligibility to participate in

European research programmes. This

has triggered a number of alliances and

partnerships with Cypriot institutions.

“A couple of projects migrated from our

parent University of Central Lancashire

to Cyprus as an EU member state and

we will act as principal investigators,” he

noted. “This is being seen in other local

universities as well.”

With the new fee structure of British

universities (up to £9,250 per year)

being prohibitive for a great number of

Cypriot and European students, and

Brexit taking the EU’s loan scheme

out of the picture, Poutziouris argued

that this presented an opportunity for

Cypriot banks to use their mountains

of cash as loans to families wishing to

invest in their children’s education. “We

have seen an increase in the number of

Cypriots and of other Europeans choosing

to study in Cyprus,” he pointed out.

What is more, following Brexit, British

universities have started to open more

campuses in Europe, which offers Cyprus

universities an opportunity to join

consortiums and operate beyond local

borders. “We can play the so-called European

role,” he says, “because we offer

British degrees and that’s an advantage

to EU students.”

“I’m a great believer in British education,”

said Marios Andreou, joining

the conversation and everyone round

the table agreed. “I think there’s an opportunity

for British universities to set

up some kind of association in Cyprus,

so that they can attract students who

“MORE

AND MORE

CYPRIOT

INVESTORS

ARE

LOOKING

TO OBTAIN

LONDON

REAL

ESTATE”

MICHAEL TANNOUSIS

wouldn’t otherwise go to Britain

to study.”

Barton beamed with delight

on hearing a real sense of

optimism coming from the

members of the Association

and their commitment to furthering

economic ties between

the two countries. “I wish

we had had this conversation

two weeks ago, because I was

speaking about all the British

International School opportunities

in Europe,” he quipped.

Nonetheless, he acknowledged

that customs issues remain a

thorny issue. “What we are

really keen to do is to make

sure that they’re as simple and

straightforward as possible.

Also, our ambition is to make

the UK border the best in the

world, in terms of the ease of

crossing,” he said. “That’s one

of the reasons why we have

been deferring some controls

on imports to the UK.”

In 2021, the Cyprus Government

unveiled a 5-year plan

to draw €1.2 billion from the

EU’s Recovery and Resilience

(RRP) Facility. The money will

be used to digitalise the public

sector, invest in clean energy

and build the tech sector into a

pillar of economic activity. The

RRP plan will run in tandem

with Cyprus’ “Vision 2035”,

an evolving strategy to build a

resilient and sustainable economy,

funded by EU Structural

Funds. This realm of plans

and programmes is extremely

complex.

“We could rely on expertise

coming from the UK to help

us make this plan come true.

And, given that the EU wants

to stop using Russian gas,

opportunities arising from our

hydrocarbons in the Eastern

Mediterranean might now get

some traction as well,” Andreou

noted. “This could also help

with finding a solution to the

Cyprus problem, if it’s dealt

with delicately,” he added as an

afterthought.

The burgeoning startup ecosystem

of Cyprus could also

act as a pole of attraction

for UK investors, particular

early-stage venture capital providers,

who would also inject


“WE HAVE SEEN AN INCREASE IN

THE NUMBER OF CYPRIOTS AND OF

OTHER EUROPEANS CHOOSING

TO STUDY IN CYPRUS”

PANIKKOS POUTZIOURIS

into the system valuable experience

as regards taking ideas to market.

Poutziouris suggested that opportunities

for collaboration through the

Commonwealth would also send

a positive message to the broader

region that Cyprus is not merely in

the EU corner but represents the

best practices of British businesses.

With headquartering spearheading

the promotional activities of Invest

Cyprus – the country’s investment

promotion agency – there is also

a unique opportunity to invest in

private secondary school education.

Andreou brought up the example of

French software developer Murex,

which chose to bring some 200 of its

people and their families to Nicosia,

based on the fact there was a French

private school in the capital.

So – what is British plan to promote

trade and investments in this new

world order?

“We’re doing a lot of work to support

and encourage UK SMEs to

export, by making sure that we’re

providing clear advice,” Chris Barton

explained. This includes using ‘export

champions’ who act as advisors and

“GIVEN

THAT THE EU

WANTS TO

STOP USING

RUSSIAN GAS,

OPPORTUNITIES

ARISING

FROM OUR

HYDROCARBONS

IN THE EASTERN

MEDITERRANEAN

MIGHT

NOW GET

SOME

TRACTION”

MARIOS ANDREOU

strategically placed experts

who understand local markets

and can make connections

in both directions. “Then

we have financial support,

through the British Business

Bank and UK Export Finance

– the UK’s export credits

agency, whose stated mission

is ‘to ensure that no viable UK

export fails for lack of finance’,

and we’ve many billions of

pounds’ worth of facilities

across Europe,” he said.

On the technology side,

the Global Entrepreneur

Programme offers mentoring

and business support to

new startup founders across

Europe, helping them establish

companies in their

local market and in the UK.

“We’re here to help,” he said

in a genuine, earnest way. “If

there are things that we can

do to facilitate and grow the

UK-Cyprus trade and investment

relationship, there’s a

deeply strong commitment

from the UK government to

see that happen. I’m a natural

optimist, but I think there

are really good grounds to be

optimistic.”

“IT WOULD BE USEFUL

IF A BIG UK BANK

DECIDED TO SET UP ITS

OFFICES HERE”

ANDROULLA PITTAS

| 142 | INVESTMENT

GLOBAL

INVESTMENT

OUTLOOK

By Loucas Savva CFA, Consultant,

Aon Wealth Solutions

The key liquid asset classes of equities,

credit and government bonds – the lion’s

share of institutional investors’ portfolio

exposures – have all been falling this year.

Commodities (a much less widely held

asset) were a big standout as the Ukraine

crisis and Russian sanctions worsened an

already under-supplied crude oil market, and metals and grain

prices also came under pressure.

Equities and bonds do not fall in tandem very often, although

we did observe something similar in late 2018 when the Federal

Reserve attempted to tighten monetary policy but then

changed course after a poor market reaction and reverted to

an easy stance. After all the years of stimulatory monetary policy,

this year’s tough talk from central banks is a major change

and has fanned market turbulence.

Ukraine and markets

Russia’s invasion of Ukraine should be seen as an aggravating

factor, rather than a causal one, in market declines, pushing

commodity prices (particularly energy and grains) and expected

inflation higher, upping pressure on central banks to act.

With sanctions on Russia still being tightened, commodity

markets will likely remain nervous. Commodity demand is

also key as this had been driving price gains before the war

in Ukraine. China’s recent struggles with new outbreaks of

COVID-19 are slowing its economy and, given its role as

key commodity consumer, this is checking commodity demand-pull

inflation.

Will peaking INFLATION restore calm?

Current market unease is based on more than rising inflation.

The inflationary impulse is coming from multiple sources.

Strains in supply chains still remain problematic (high transport

and freight costs, order backlogs and delivery delays),

although they may no longer be worsening. Just as concerning

is the fact that tight labour markets are fuelling higher wages

as businesses pass higher costs on in the form of higher prices.

These are more persistent inflation-creating factors than high

commodity prices, which could, in fact, be temporary.

Our experience of high inflation episodes in the past shows

that the longer inflation stays higher, the harder it is to bring

it down and keep it down. Interest rates may then have to

rise to levels which choke off economic activity, creating a

risk of triggering outright recession. The fear of such negative

economic outcomes is a major factor in the current market

unease and this looks unlikely to go away.

THIS YEAR’S TOUGH TALK FROM CENTRAL BANKS

HAS FANNED MARKET TURBULENCE

| 143 |

THE CHALLENGE NOW IS TO LOOK FOR RETURN GENERATORS WITH MORE INDEPENDENT DRIVERS

Central bank tightening

Rates have only begun to rise but the much bigger damage to markets

has come from the way interest rate expectations for 2022/23 as a

whole have leapt up. This has challenged asset markets at large, which

had benefited from the pandemic-driven move to zero interest rates

and plentiful liquidity.

The bond risk premium is back

Higher policy rate expectations have been pushing both the front-end

of the yield curve and longer-dated yields higher. Higher longer-dated

yields are, in part, reflecting a recovery in the so-called ‘bond risk

premium’ – the added compensation that investors in longer duration

bonds seek for unexpected inflation or interest rate shifts. For

many years, this risk premium has been very low and, in some countries,

negative, reflecting huge central bank bond buying and little

fear of high inflation. On both counts, the position has changed, as

central banks cease buying bonds and inflation/interest rate uncertainties

rise.

Equity risk premium less supportive

The significant rise in global mid- to long-duration bond yields has partially

eroded an important underpinning of the case for equities since the

end of the financial crisis – the equity risk premium. This is the additional

reward equity investors might reasonably expect over government

bonds for the added risk. Thanks to low or falling bond yields,

a high equity risk premium has been supportive for many years.

Earnings support likely to fade

While the rise in bond yields takes away some support to valuations,

equities are ultimately fuelled by profits (earnings). Higher market

valuations have been a big contributor to market gains in recent

years but nobody can deny the impressive revival of corporate profits

since the pandemic falls. That said, a part of this is

a one-off, reflecting unusually buoyant economic

conditions created by huge monetary and fiscal

stimulus.

Just weaker or recessionary?

The trickier question is whether earnings growth

will stabilise at a reasonable level which warrants

current market valuations or whether economic

conditions turn down faster, under the strain of an

inflation-hit consumer, cost-burdened corporates,

and the cooling effects of rising interest rates. A

slowing economy can be ridden out without too

much market risk. The bigger problem arises if

About Aon

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decisions for the better – to protect and

enrich the lives of people around the

world. Our colleagues provide our clients

in over 120 countries with advice and

solutions that give them the clarity and

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protect and grow their business.

For more information, please visit www.

aonsolutions.com.cy

weakness is more marked, and the economy shrinks, taking us into

a recession. This is where the high cyclical leverage of corporate

earnings makes large outright profit falls likely. The persistent nature

of current inflation and the planned path for interest rates makes

a recession in 2023 appear more of a risk than would have seemed

likely even a few months ago. This keeps downside risks in markets

uncomfortable.

Caution on credit spreads

Pressures on corporate bond credit spreads and credit default swap

(CDS) spreads are often an early warning sign of poorer economic

conditions or, if they rise sufficiently, of a recession. The size of the

move so far does not yet signal economic trouble, falling well short

even of previous credit stress points which did not lead to a recession,

such as 2015-16’s energy price shock.

An eventual macroeconomic deterioration and less buoyant corporate

profitability would widen spreads from current levels. Clearly, some

supports do remain, which reduces the likelihood of very large credit

spread widening, but central bank support is far less likely to be seen

again in a market sell-off.

Persistent inflation, rising interest rates, a withdrawal of central bank

liquidity and higher economic uncertainty are pushing market volatility

higher on an underlying basis. Higher volatility signals a more

changeable market environment, and one in which support from

governments and central banks is limited, given that much fiscal and

monetary policy ammunition has already been utilized due to the

pandemic.

Focus on DIVERSIFICATION

Elevated inflation and subsequent policy tightening are likely to create a

headwind for traditional 60/40-type portfolios. The interlocking shocks

of Ukraine, higher inflation and rapid central bank action repricing have

pushed equities and bonds to become more correlated.

This is a good time to see which of the existing diversifiers

in a portfolio might be expected to perform

well and whether some reinforcing is required.

The challenge now is to look for return generators

with more independent drivers. Most alternative

asset classes, particularly in illiquid private markets

(e.g. real estate, infrastructure) do have independent

drivers but many investors will have liquidity or fee

constraints which limit their use. In the liquid space,

conservative hedge fund strategies will have low dependence

on rising markets and some will directly

benefit from rising volatility and greater market uncertainty.

| 144 | FINE DINING

fInest

dining

Whatever your personal

preference, there is certain to

be a high-quality venue ready

to tantalise your taste buds

in a charmingly luxurious

setting somewhere in

Cyprus. The island boasts a

good selection of fine-dining

venues that collaborate

with top international chefs

and their globally-branded

chains. Enjoy our selected

recommendations below to

turn any dining experience

into a special occasion.

Vivaldi by

Mavrommatis

Situated inside the luxurious Four Seasons

Hotel in Limassol and operated in conjunction

with the renowned Paris-based Michelin

star awarded Cypriot Chef Andreas Mavrommatis,

this multiple prize-winning venue’s

recipe for success is based on the simplicity of

its market-fresh Mediterranean ingredients.

Matsuhisa Limassol

World-renowned chef Nobu Matsuhisa and the Amara Hotel in Limassol come together

to set a new standard in Cyprus’ culinary life with a unique Japanese-Peruvian culinary

experience and bespoke array of Nobu’s legendary signature dishes. Guests can enjoy their

meals, including one-off signature pieces, in a space designed by David Rockwell.

| 145 |

Ristorante Locatelli

Also at the Amara Hotel, Ristorante Locatelli is the Cyprus-based

incarnation of the revered London-based, Michelin-star

restaurant headed by celebrity chef Giorgio Locatelli.

It boasts a menu embodying Italy’s spirit of conviviality,

whereby the heart of cooking is defined as the enjoyment of

quality food in good company. The al fresco dining experience

also offered by the venue is highly popular.

Armyra By

Papaioannou

Another fine choice at

the Amara Hotel, Armyra

by Papaioanou brings

the vision and experience

of Chef George Papaioannou

and his brainchild,

Armyra to Cyprus,

with the freshest fish,

seafood and many more

culinary delights prepared

with the region’s

purest ingredients. The

open-air fish restaurant

sees diners serenaded by

the waves as they enjoy

the riches of the seas.

Nammos

A brand-new arrival this summer is

Parklane Resort & Spa’s Nammos

Limassol. The menu is a homage to

local produce with seafood flavours

and quality meats. The wine and cocktail

list completes a culinary journey

through the Mediterranean way of life

from a brand that started life on the

beaches of Mykonos and now enjoys

a popular presence in prime locations

from the French Riviera to Dubai.

LPM Restaurant Bar Limassol

Located at Parklane, a Luxury Collection Resort and Spa in Limassol, and with

the Mediterranean as a backdrop, LPM Limassol is completely in tune with

the spirit of the place including seafood freshly sourced from the nearby

waters. Inside you’ll find the hallmarks of all LPMs around the world:

bright art, flowers and crisp linen. The classic LPM bar overlooks the room

while an oyster bar allows occupants to view the open salad and prep-area.

Diners can also enjoy sunset dining on the terrace.

| 146 | FINE DINING

L’Atelier Robuchon

L’Atelier Robuchon are known as being particularly

decorative Michelin Star restaurants, serving the late

master chef Joël Robuchon’s signature tantalising and

fresh take on French haute cuisine in a stylish black and

red environment. This chic addition to the global collection

of venues, situated at Ayia Napa Marina, is no

exception to the rule.

Le Deli

Robuchon

Also at Ayia Napa Marina,

Le Deli Robuchon

offers a casual yet sophisticated

all-day dining

space, serving coffee,

breakfast, lunch, dinner

and snacks with eat-in

or take-away options

and a patisserie. Le Deli

also offers a carefully

selected range of wines,

teas, cheeses, pastries

and breads all handmade

with quality ingredients.

Many of the products in

the Deli were personally

selected and championed

by Chef Robuchon.

| 147 |

Copyright © 2022 IMH

All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying,

recording, or other electronic or mechanical methods, without the prior written permission of the publisher

fifth edition

A Growing

Headquartering Hub

for Tech Companies

Cyprus is home to a number of global ICT companies, using the island as a hub for soſtware

development, systems integration, testing services, disaster recovery, research & development

activities, project management and marketing & sales, while servicing clients in Europe, the Middle

East, North Africa and beyond.

Strategically located at the crossroads

of Europe, Africa and Asia

A modern and dynamic EU &

Eurozone Μember State

Ideal location for tech companies

to set-up and scale their business

Wide and easy access to

high growth markets

High quality of life

in a safe environment

Well-educated workforce

and tech-savvy talent

Strong and reliable

professional services

Low cost

of doing business

A thriving headquartering

jurisdiction

Efficient and transparent

tax & legal framework

Invest Cyprus, a state-owned, non-for-profit organization, provides hands-on

support through a dedicated team, welcoming enquiries from international tech

companies looking to establish their regional headquarters in Cyprus.

www.investcyprus.org.cy

Invest Cyprus

WM issue 5

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