In a globalized economy where multinational companies are pressed to maintain and increase quality while cutting costs to meet increasingly higher client expectations, Cyprus provides a complete value proposition.
Cyprus offers one of the most attractive tax systems in Europe. The country provides a simplified, effective and transparent tax regime that is fully compliant with the EU laws and regulations.
In addition, the Organization for Economic Cooperation and Development (OECD) includes Cyprus on its “white list” as one of the 45 countries that have introduced and implemented the highest of internationally agreed standards on harmful tax practices.
Dividend income, most international transactions, profits from overseas permanent establishments and profits from the sale of securities are exempt from tax. Also, there is no withholding tax on dividend, interest and royalties paid from Cyprus.
Cyprus has a network of double taxation agreements with more than 50 countries. For a complete listing please visit the Ministry of Finance Double Taxation Agreements Section (http://www.mof.gov.cy/mof/ird/ird.nsf/dmldtc_en/dmldtc_en). Additionally, Cyprus has access to EU Directives that focus on reducing or eliminating foreign withholding taxes.
Human Talent & Level of Services
Level of Professional Services
Cyprus is a dynamic business centre that offers relatively lower operating costs while also providing high level and top quality professional services, including accounting, auditing, tax, business administration, legal, investment and funds management.
Various law firms specialize in international work and assist foreign investors with both set-up and contractual formalities, while the world’s leading accountancy and consultancy firms are present on the island.
=International recognition of Cyprus’ high level of professional services is reflected in the decision of the Institute of Chartered Accountants in England and Wales (ICAEW) and the Chartered Institute of Management Accountants (CIMA) to select Cyprus as the first country outside the United Kingdom to train ICAEW and CIMA accountants.
Human talent is probably Cyprus’ most compelling competitive advantage since its forms part of the people’s culture and history. Cypriots are highly educated, qualified and almost all are bilingual, if not multilingual. Most importantly, however, business is still done with a personal touch.
Cyprus ranks amongst the top countries in Europe for tertiary education per capita!
2013 statistics demonstrate that 39,2% of Cypriots in the 25 – 64 age group have acquired tertiary education – higher than the EU28 average of 28,63% and one of the highest percentage in the world.
Cyprus is actively supporting various projects that augment the island’s learning and innovative capacity and status as a knowledge economy.
Legal and Regulatory Framework
Cyprus has a comprehensive, modern and forward-looking legal and regulatory framework based on English Common Law principles. The country’s legal framework is widely recognized as a business-friendly and effective system, that allows for reliable and transparent business practices.
The Cyprus Investment Promotion Agency has a leading role in constantly developing and modernizing the country’s legal framework by promoting new and improved legislation in a number of areas, always aiming at further improving the overall investment environment.
Naturally, being a European Union member state Cyprus’ legal framework is aligned with EU laws and regulations (Acquis Communautaire).
Macroeconomic Prospects & Opportunities
Economic recovery in Cyprus is expected in record time, despite the challenges faced in the last years. Thanks to the Government’s commitment to achieving economic recovery and growth, Cyprus has managed to turn the page, successfully facing the island’s economic challenges, and establish itself as a thriving business center.
The following recent economic statistics reflect the improvement of Cyprus economy, and indicate the prospects for a flourishing economy much sooner than expected:
Main Economic Indicators for Cyprus
Track Record FDI
Economic Sentiment Indicator
10-year Government Bond Yield
GDP Growth (% change)
Quality of Life
Cyprus offers an enviable lifestyle in a clean and healthy environment with a high standard of living. Living and working in Cyprus are directly related to fabulous weather, beautiful nature, art and culture, safety, security, and above all, hospitable and warm people. It is the combination of all these factors that makes the experience of living on the island extremely desirable and attractive. The balance between work and family part of everyday life, is unique and truly difficult to match.
Cyprus combines an international competitive business environment with a pleasurable and balanced way of life.
The UNDP Human Development Index Report 2013 ranked Cyprus 31st out of 187 countries for the quality of life.
The Knight Frank Report ranked Cyprus on the Fall of 2013 as the 5th better place for Lifestyle among major European Cities and other competitive destinations. The report was also published in the Financial Times on October 2013.
The local infrastructure is ideally suited for businesspeople who need to get things done. Thanks to its modern road network, extensive port facilities and two new international airports, travel and transport in and beyond Cyprus is fast, efficient and economical.
Considerable investment has been made into transforming the island into a major telecommunications hub in the region. By building upon its technologically advanced infrastructure, Cyprus has established an extensive telecommunications network, both in terms of cable and satellite, which ranks amongst the best in the world
The coastal resorts of Larnaca and Paphos each operate international airports serving flights to and from both Europe and the Middle East. Larnaca is the larger of the two airports, while the construction of an all new facility is set to begin soon.
Limassol and Larnaca are both bustling ports and work around the clock to serve the island’s considerable import and export markets. Limassol is the largest port, although considerable infrastructure is in place to provide for easy and efficient operations at each coastal facility.
Cyprus is Europe’s eastern outpost at the crossroads of three continents – Europe, Africa and Asia – providing a gateway to and from each one of them. The country’s geographical location has been considered of strategic importance in global trade for thousands of years.
Recently, the discovery of natural gas resources and possibly oil, has further upgraded the strategic importance of the island, which is also considered to be a stabilising factor in the region’s political developments.
EU Member State and Member of the European Monetary Union
The Republic of Cyprus became a full member of the EU on May 1st, 2004. Accession to the EU was a natural choice for Cyprus, driven by its culture, civilization and history, as well as its unwavering commitment to the values of democracy, freedom and justice. Cyprus successfully assumed the EU Presidency from July to December 2012.
At the start of 2008, Cyprus joined the European Monetary Union, leveraging a robust economic performance recorded by key economic indicators, joining the eurozone meant that investors could take advantage of the opportunity to freely access the 500 million EU market, while also benefiting from fewer risks, lower costs and increased price transparency across the eurozone.
Accession to the EU and the eurozone launched a new era of commitment to quality and growth in Cyprus. Furthermore, the country continues to encourage Foreign Direct Investment opportunities in priority economic growth sectors.
Today, Cyprus actively participates in EU programmes, focusing on strengthening growth in various economic sectors, as well as entrepreneurship and innovation across sectors and processes.
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