Doing Business in Cyprus (UAE Edition)
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DOING BUSINESS C YPRUS<br />
12<br />
UNITED ARAB EMIRATES EDITION<br />
crisis <strong>in</strong> 2013, <strong>Cyprus</strong> undertook a major<br />
reform agenda and while still fac<strong>in</strong>g<br />
some economic challenges, the small<br />
EU nation has demonstrated resilience<br />
and an ability to bounce back to growth.<br />
The year 2015 signalled a sooner-thanexpected<br />
exit from recession and a rapid<br />
economic turnaround followed, with 2017<br />
record<strong>in</strong>g almost 4% growth – earn<strong>in</strong>g<br />
<strong>Cyprus</strong> praise as an economic success<br />
story. <strong>Cyprus</strong>’ resilience <strong>in</strong> the face of the<br />
pandemic was once aga<strong>in</strong> evident with<br />
GDP growth reach<strong>in</strong>g a strong 5.5% <strong>in</strong><br />
2021, although the European Commission<br />
forecasts a downturn to 3.2% growth <strong>in</strong><br />
2022. Consistent credit rat<strong>in</strong>g upgrades<br />
have further boosted confidence and<br />
foreign direct <strong>in</strong>vestment has been<br />
flow<strong>in</strong>g <strong>in</strong>to all key sectors. <strong>Cyprus</strong> has<br />
reta<strong>in</strong>ed and strengthened its status as an<br />
attractive <strong>in</strong>vestment gateway to the EU<br />
and other high-growth markets, as well<br />
as a secure base to tap <strong>in</strong>to opportunities<br />
<strong>in</strong> the Middle East. Offer<strong>in</strong>g a tax-efficient<br />
EU company domicile, the country is also<br />
emerg<strong>in</strong>g as a compell<strong>in</strong>g dest<strong>in</strong>ation<br />
for regional headquarters and a base for<br />
tech companies, as well as an <strong>in</strong>creas<strong>in</strong>gly<br />
attractive location for fund managers and<br />
promoters.<br />
GROWING INVESTMENT FUND SECTOR<br />
<strong>Cyprus</strong> has big ambitions <strong>in</strong> the<br />
<strong>in</strong>vestment funds sector to establish<br />
itself as a contender <strong>in</strong> the global asset<br />
management <strong>in</strong>dustry. The steady growth<br />
<strong>in</strong> both Assets under Management and <strong>in</strong><br />
the number of fund structures licensed<br />
and active <strong>in</strong> <strong>Cyprus</strong> have underl<strong>in</strong>ed<br />
the strength and appeal of the novice<br />
domicile. Assets under Management<br />
(AuM) have seen a formidable <strong>in</strong>crease<br />
from €2.7 billion <strong>in</strong> 2016 to €11.1 billion <strong>in</strong><br />
the first quarter of 2022, show<strong>in</strong>g that it is<br />
not the sector’s size but its fast growth that<br />
has impressed, and is be<strong>in</strong>g recognised<br />
by the global asset management and<br />
<strong>in</strong>vestor community. Investment funds<br />
CYPRUS FACTS<br />
& FIGURES<br />
EU Member s<strong>in</strong>ce 2004,<br />
Eurozone member s<strong>in</strong>ce 2008<br />
<strong>Cyprus</strong>’ maritime sector accounts<br />
for €1 billion <strong>in</strong> annual revenue and<br />
is around 7% of the island’s GDP<br />
<strong>Cyprus</strong> is an established<br />
<strong>in</strong>ternational bus<strong>in</strong>ess and service<br />
centre for shipp<strong>in</strong>g, f<strong>in</strong>ancial<br />
services and commerce, and is<br />
classified by the World Bank as<br />
a high-<strong>in</strong>come country<br />
Investment funds have already<br />
<strong>in</strong>vested more than €2 billion<br />
<strong>in</strong> several sectors of the Cypriot<br />
economy, such as shipp<strong>in</strong>g,<br />
hospitality, education, healthcare,<br />
and renewable energy