Foreign investors active in Cyprus want to have better information on developments in the energy sector, improvement in local transport infrastructure, as well some facilities for themselves and their families in relation to their businesses.
Speaking after the “Foreign Investors Dialogue with the Government” event at the President Palace, Marios Tannousis, Managing Director of the government’s investment promotion agency, Invest Cyprus, said that about 100 foreign investors were informed about the actions being implemented or planned by the government.
This followed a similar event held last June, with President Nikos Christodoulides telling the gathering that the aim of Cyprus is to become one of the most attractive destinations to live, to work and do business.
Tannousis said the event was “very constructive”. He said the government introduced the implementation timeframe of the Investment and Talent Attraction Strategy, already in place since 2022, as well as enhanced actions approved by the Council of Ministers on February 7.
Invest Cyprus Chairman Evgenios Evgeniou said that the event gave the opportunity to foreign investors to be informed by the President and government Ministers about the initiatives undertaken by Cyprus to improve the business climate and to assist their activities in our country.
He added that Invest Cyprus will continue to stand by the foreign investors and try to promote and resolve their problems so that they are satisfied that they are in Cyprus.
President Christodoulides, addressing the investors, said that the goal is to make Cyprus one of the most attractive destinations for living and doing business.
He said that the amendment to the Strategy was mainly based on the needs of the investment community, as they were recorded during the round table discussion held last summer.
Christodoulides assured investors that his government will continue to be in constant dialogue with them, with the aim of making Cyprus one of the most attractive destinations to live, work and do business.
New actions
Some of the actions mentioned concern, among others, the new housing policy and the Build to Rent plan, the possibility of submitting an application electronically to secure a permit for renewables (RES) projects, the implementation of the Strategic Investments Law, the progress in the adoption of the Blue Card and the amendment of regulation on the age of enrolment of children in schools, to ensure the smooth continuation of their education in the country.
Finance Minister Makis Keravnos said that the government has revised the strategy for attracting foreign companies and talents “in order to improve its efficiency and also to address key issues that concern foreign companies and their employees”.
Outlining the changes in the strategy, Keravnos said the government is moving to amend the rules so that companies can remain on the register of the Companies Facilitation Unit even if they have ceased to meet some of the eligibility criteria, thereby making it easier to do business and at the same time introducing the “blue card”, which determines the conditions of entry and residence of highly skilled third-country nationals in all EU countries.
In addition, he said that the government has provided for the issuance of a type C entry visa marked “business”, which allows foreign visitors to enter the Republic for the purpose of conducting business activities, without having the right to work, adding that “we corrected an inconsistency so that children of employees from third countries to continue their studies in Cyprus according to their level of education and age”.
He added that the government has adopted measures to facilitate the licensing process for the establishment of private schools to meet the needs of the children of foreign workers in Cyprus and is proceeding to amend the existing regulatory framework to allow state land to be used for the establishment of educational institutions.
Regarding housing, he noted that the government has introduced a number of programmes aimed at alleviating the problem.
Support innovation
He also stated that the government is introducing measures to improve the business environment and support innovation and entrepreneurship which include the establishment of the national promotion body and the first Cyprus Equity Fund and the enactment of a new law on the establishment and operation of collective investment management companies.
Outlining the outcome of the strategy so far, Keravnos noted that more than 1,984 companies have registered with the Company Facilitation Unit, while more than 19,000 skilled workers have been employed and more than 13,250 family reunification permits have been granted. In addition, Cyprus achieved the maximum number with 500 visas for digital nomads.
Interior Minister Constantinos Ioannou, referred to the changes that will streamline the licensing procedures.
“We are now in the process of establishing the strategic development branch in the Town Planning department, under which the project management branch and the permitting branch will operate,” he said, noting that a key feature that will bring red tape reduction is that for each strategic plan development there will be a project manager, who will interact with the public services involved.
He emphasised that under the fast-track process, the issuance of the building permit and construction will be given within one year at the most.
On the issue of housing, Ioannou acknowledged that the increase in the prices of building materials due to inflation, combined with the increase in demand for residential units in the last two years have led to a sharp increase in the prices of houses for sale or rent and general lack of supply, compared to actual demand and therefore lack of affordable housing.
Incentives
“We are now introducing a package of incentives and policies aimed at tackling housing affordability specifically for young people. The package aims to increase the overall supply of housing units including the supply of affordable housing,” he said.
Especially for investors, Ioannou highlighted the build-to-rent project, which offers a 45% increase in buildable area in exchange for providing numbers of units for rent at affordable prices over a period of about six years.
He noted that this programme offers a number of financial benefits and incentives, including 100% tax exemption on rents collected for affordable units, 3% exemption from the extraordinary defense levy, an increase to 5% of the capital expenditure deduction and an increase to 15 % of equipment discount.
Regarding the delays in the naturalisation process, Ioannou said they have started implementing an overtime programme to deal with the backlog. Some employees will be placed in the Department and a new legislation will amend the law streamlining the process for highly qualified employees of eligible companies and for their family members but also will introduce a new way of naturalisation based on years of residence in Cyprus.
Energy, Trade and Industry Minister Giorgos Papanastasiou presented the operation of the Company Facilitation Unit which acts as a One-Stop-Shop and the people behind it to help investors.
“We monitor (the process) from day one until the investment is delivered and we support the investor,” he said.
2,000 on CFU
He also presented figures showing that almost 2,000 foreign companies were registered in Cyprus since the establishment of the Companies Facilitation Unit with the majority (1,640 in 2022) originating mainly from Lebanon, Israel, the US, the UK, Ukraine and Russia.
“The average number of companies we expect on an annual basis is 300,” added Papanastasiou.
Education, Youth and Sports Minister Athina Michaelidou referred to the amendments to address the problems of enrolment in schools and language skills.
She noted that the changes ensure the continuation of the education of children who come to Cyprus with their parents based on their level and not age, while the process of licensing schools to meet the educational needs of children of foreign workers in Cyprus is now simplified.
Regarding language proficiency, Michaelidou said that the government now provides more opportunities, through the examination by the Ministry of Education that takes place once a year, as well as opportunities in collaboration with the University of Cyprus in combination with attending courses three times a year, or only two exams with no lessons, twice a year.
“We believe that by taking these measures we facilitate registrations and relocation to Cyprus,” she said, adding that the Ministry is open to hearing other issues in order to find solutions.
Labor Minister Yannis Panagiotou stated that Cyprus has an attractive and flexible framework for investors to attract talent and personnel from the local labour market, the EU labour market and internationally.
He said the Ministry has managed to improve the process, which is now 50% faster than a year ago.
“I see that there is more room for improvement and our goal is within the first half of 2024 to take less than 60 days to process every application we receive,” he said, noting that the Ministry is also promoting a series of actions to make the labour market more accessible for third country nationals studying in Cyprus.
