Cyprus business services boom in Q2

The professional business services sector in Cyprus has so far weathered the storm in financial markets that began last August, recording an impressive increase in turnover in the second quarter.
Compared with the same period of 2007, turnover in the “Legal, Accounting, Book-keeping, Auditing and other related activities” sector rose by 29.1% in April-June 2008.
Strong growth in this sector could be related to Cyprus’s attraction as a base for outward investment. The corporate tax rate is 10%, labour taxes are low and there is no tax on dividends paid to non-residents.
Computer services also saw strong growth, with turnover rising by 14.1% in the second quarter compared with April-June 2007.
Turnover in hotels and restaurants, heavily dependent on the sluggish tourism sector, rose by 7.4%, which is around 2.4% in real terms once consumer price inflation of 5% in the second quarter is subtracted.
Architectural services fared better than might have been expected given the downturn in the property market. Turnover for “Architectural, Engineering and other related activities” rose by 8.5% in April-June over the same period of last year.

Water transport turnover falls in H1

Meanwhile, figures for land transport and communications in the first half of the year show that turnover decreased by 2.6% compared with the corresponding period of 2007.
Water transport turnover decreased by 9.0%, presumably as the shipping sector was affected by a downturn in world trade.
Turnover of air transport rose by 3.8% (less than inflation of 4.8% in January-June) and turnover of post and telecommunications rose by 8.0%.

Fiona Mullen