2023 Doing Business in Cyprus (UK Edition)

DOING BUSINESS C YPRUS
25
UNITED KINGDOM EDITION
STRONG REBOUND TO GROWTH
Successive credit rating upgrades over the years and the continuous introduction
of new incentives have attracted billions in foreign investment to Cyprus, with
substantial inflows from the US, non-EU countries, and Asia including the Middle East.
Although having withstood some serious economic shocks over the last ten years,
the resilience and growth performance of Cyprus has been exceptional and even
exceeded international expectations. Real
ICyprus GDP growth averaged 4.6% in 2018-2022
was ranked third
despite the Covid-19 pandemic, the war
worldwide in the recovery
in Ukraine and other related disruptions.
Foreign investment flows have been of foreign direct investments
significant. In the ten-year period 2013-
after the pandemic.
2022, net inflows (liabilities) reached €13.5
billion. This investment was driven by equity, with data on transactions suggesting that
real estate, communications and headquartering all played an important role.
Cyprus was ranked third worldwide in the recovery of foreign direct investments
after the pandemic, according to the country’s investment promotion agency, Invest
Cyprus. According to the Greenfield FDI Performance Index of FDI Intelligence, direct
investments in Cyprus showed a 150% increase in the first half of 2022, compared to
the corresponding period in 2019. Also noteworthy is the increase in investments in
software and IT, which reached a 600% increase in 2022 compared to the corresponding
period in 2019.
THRIVING TECH HUB
IIn 2022 the country boasted
almost 450 start-ups and scaleups
with a combined value of
€3.7 billion
The technology and communications
sector in Cyprus has become fiercely
competitive, with a number of players
deploying cutting edge solutions to both
increase their local market share and
generate growth through the launch of
new technology and products. 5G was
rolled out in 2021, making Cyprus the first
EU state to achieve 100% 5G coverage.
Cyprus is already home to a number of
major tech firms, such as NCR, Amdocs,
Wargaming, 3CX, Exness, Bolt, Thomson
Reuters, Melsoft Games, Easybrain
and Nexters, and has gained ground in
successfully attracting investment capital
in blockchain. The country’s start-up
community has been growing rapidly. In
2021, Cyprus broke national records with
€85.5 million raised by start-ups, and
in 2022 the country boasted almost 450
start-ups and scale-ups with a combined
value of €3.7 billion. With an estimated
4,000 entrepreneurs, the buzzing hub is