Doing Business in Cyprus (UAE Edition)
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DOING BUSINESS C YPRUS<br />
29<br />
UNITED ARAB EMIRATES EDITION<br />
allow a fresh <strong>in</strong>flow of new private players operat<strong>in</strong>g <strong>in</strong> both renewables and gas to<br />
compete <strong>in</strong> the local market – and <strong>in</strong> a broader regional market thanks to the EuroAsia<br />
Interconnector project to connect <strong>Cyprus</strong>, Israel and Greece via submar<strong>in</strong>e electricity<br />
cable and the related EuroAfrica Interconnector to connect Egypt.<br />
STABLE BANKING SECTOR AND GROWING INVESTMENT FUNDS<br />
Today, <strong>Cyprus</strong> banks ma<strong>in</strong>ta<strong>in</strong> high levels of capital adequacy and liquidity but<br />
cont<strong>in</strong>ue to grapple with manag<strong>in</strong>g their non-perform<strong>in</strong>g loan (NPL) portfolios.<br />
The restructur<strong>in</strong>g of the bank<strong>in</strong>g sector after 2013 attracted important <strong>in</strong>ternational<br />
<strong>in</strong>stitutional <strong>in</strong>vestors and fresh foreign capital and encouraged accelerated sales of<br />
NPLs. These developments substantially<br />
reduced risk and enabled the f<strong>in</strong>ancial<br />
system to operate on a healthier basis.<br />
The island also hosts a thriv<strong>in</strong>g forex<br />
<strong>in</strong>dustry with many global giants bas<strong>in</strong>g<br />
their operational headquarters <strong>in</strong> <strong>Cyprus</strong>.<br />
In addition, the <strong>in</strong>vestment funds sector<br />
has grown exponentially <strong>in</strong> the last few<br />
years with Assets under Management<br />
(AuM) see<strong>in</strong>g a stagger<strong>in</strong>g <strong>in</strong>crease from<br />
€2.7 billion <strong>in</strong> 2016 to €11.1 billion <strong>in</strong> the<br />
first quarter of 2022, prov<strong>in</strong>g <strong>Cyprus</strong><br />
is be<strong>in</strong>g recognised by the global asset<br />
management community. Investment<br />
funds have already <strong>in</strong>vested more than<br />
€2 billion <strong>in</strong> several sectors of the Cypriot<br />
economy, such as shipp<strong>in</strong>g, hospitality,<br />
education, healthcare, and renewable<br />
energy.<br />
IThe <strong>in</strong>vestment funds sector<br />
LUXURY TOURISM AND HIGH-END REAL ESTATE<br />
has grown exponentially <strong>in</strong><br />
the last few years with Assets<br />
under Management (AuM)<br />
see<strong>in</strong>g a stagger<strong>in</strong>g <strong>in</strong>crease<br />
from €2.7 billion <strong>in</strong> 2016 to<br />
€11.1 billion<br />
<strong>in</strong> the first quarter of 2022,<br />
prov<strong>in</strong>g <strong>Cyprus</strong> is be<strong>in</strong>g<br />
recognised by the global asset<br />
management community<br />
<strong>Cyprus</strong> cont<strong>in</strong>ues to be on the top of the list for <strong>in</strong>vestors, holiday-home seekers, expats<br />
and retirees. Tourism and real estate have always been robust sectors of the Cypriot<br />
economy, and a concerted effort to diversify the <strong>Cyprus</strong> offer<strong>in</strong>g <strong>in</strong> recent years has paid<br />
off. The number of foreign <strong>in</strong>vestors clos<strong>in</strong>g multimillion-euro deals <strong>in</strong> the last several<br />
years underl<strong>in</strong>es the fact that tourism-related real estate and <strong>in</strong>frastructure cont<strong>in</strong>ues<br />
to be one of the most attractive <strong>in</strong>vestment opportunities <strong>in</strong> <strong>Cyprus</strong>. Pre-pandemic years<br />
of record-break<strong>in</strong>g tourism numbers saw the island attract new <strong>in</strong>terest <strong>in</strong> conference,<br />
sports, health and wellness tourism. The construction and <strong>in</strong>vestment <strong>in</strong> multipurpose<br />
projects and mixed-use developments such as luxury mar<strong>in</strong>as, golf courses and more<br />
recently the island’s first-ever and only <strong>in</strong>tegrated luxury cas<strong>in</strong>o resort, are all part of<br />
the ongo<strong>in</strong>g strategy to upgrade <strong>Cyprus</strong>’ tourism product. The new cas<strong>in</strong>o resort, City<br />
of Dreams Mediterranean, will have extensive facilities and five-star status. The cas<strong>in</strong>o<br />
resort is Hong Kong-based Melco’s first expansion outside of Asia and will be the biggest<br />
cas<strong>in</strong>o of its k<strong>in</strong>d <strong>in</strong> Europe, with the <strong>in</strong>vestment for this mega project at €600 million.<br />
Spurred by this unique development, <strong>Cyprus</strong> garnered another landmark <strong>in</strong>vestment<br />
deal <strong>in</strong> 2022 with Israeli bus<strong>in</strong>ess magnate Gilad Shabtai <strong>in</strong>vest<strong>in</strong>g <strong>in</strong> over 130,000 m 2
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