2022-2023 Cyprus Country Report
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CYPRUSCOUNTRY REPORT <strong>2022</strong><br />
allow a fresh inflow of new private players operating in both renewables and gas to<br />
compete in the local market – and in a broader regional market thanks to the EuroAsia<br />
Interconnector project to connect <strong>Cyprus</strong>, Israel and Greece via submarine 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 maintain high levels of capital adequacy and liquidity but<br />
continue to grapple with managing their non-performing loan (NPL) portfolios.<br />
The restructuring of the banking sector after 2013 attracted important international<br />
institutional investors and fresh foreign capital and encouraged accelerated sales of<br />
NPLs. These developments substantially<br />
reduced risk and enabled the financial<br />
system to operate on a healthier basis.<br />
The island also hosts a thriving forex<br />
industry with many global giants basing<br />
their operational headquarters in <strong>Cyprus</strong>.<br />
In addition, the investment funds sector<br />
has grown exponentially in the last few<br />
years with Assets under Management<br />
(AuM) seeing a staggering increase from<br />
€2.7 billion in 2016 to €11.1 billion in the<br />
first quarter of <strong>2022</strong>, proving <strong>Cyprus</strong><br />
is being recognised by the global asset<br />
management community. Investment<br />
funds have already invested more than<br />
€2 billion in several sectors of the Cypriot<br />
economy, such as shipping, hospitality,<br />
education, healthcare, and renewable<br />
energy.<br />
IThe investment funds sector<br />
LUXURY TOURISM AND HIGH-END REAL ESTATE<br />
has grown exponentially in<br />
the last few years with Assets<br />
under Management (AuM)<br />
seeing a staggering increase<br />
from €2.7 billion in 2016 to<br />
€11.1 billion<br />
in the first quarter of <strong>2022</strong>,<br />
proving <strong>Cyprus</strong> is being<br />
recognised by the global asset<br />
management community<br />
<strong>Cyprus</strong> continues to be on the top of the list for investors, 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> offering in recent years has paid<br />
off. The number of foreign investors closing multimillion-euro deals in the last several<br />
years underlines the fact that tourism-related real estate and infrastructure continues<br />
to be one of the most attractive investment opportunities in <strong>Cyprus</strong>. Pre-pandemic years<br />
of record-breaking tourism numbers saw the island attract new interest in conference,<br />
sports, health and wellness tourism. The construction and investment in multipurpose<br />
projects and mixed-use developments such as luxury marinas, golf courses and more<br />
recently the island’s first-ever and only integrated luxury casino resort, are all part of<br />
the ongoing strategy to upgrade <strong>Cyprus</strong>’ tourism product. The new casino resort, City<br />
of Dreams Mediterranean, will have extensive facilities and five-star status. The casino<br />
resort is Hong Kong-based Melco’s first expansion outside of Asia and will be the biggest<br />
casino of its kind in Europe, with the investment for this mega project at €600 million.<br />
Spurred by this unique development, <strong>Cyprus</strong> garnered another landmark investment<br />
deal in <strong>2022</strong> with Israeli business magnate Gilad Shabtai investing in over 130,000 m 2<br />
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