About Cyprus

Cyprus lies in a distinctive and unique location as a "bridge" between the three continents of Europe, Asia and Africa. Due to its favourable location, Cyprus has developed, especially during the last decade, into an appealing international business centre. Internationally, Cyprus promotes its geographical position along with its educated English-speaking population, moderate local costs, good airline connections and telecommunications, an excellent climate and lifestyle, a developed legal, institutional and professional infrastructure.

Flight times to Cyprus from major international locations:

Cyprus is in the Mediterranean climate zone and it is characterized by its short mild winters and long dry and warm summers. The island is famed for its sunshine and all year round warmth. Cyprus has turned into a major tourist resort because its visitors are attracted to its sandy beaches, stunning scenery, historic monuments, rich culture, excellent quality of accommodation, and because Cypriot hospitality is legendary.

The island has an efficient and effective transport network with two main international airports, the biggest of which is in Larnaca and the other one in Paphos. Cyprus is also accessible by ship courtesy of two ports, the Limassol Port and the Larnaca Port. Limassol Port is by far the larger of the two, approximately 90% of all passenger vessels arriving at and departing from Cyprus are handled here and it is the island’s shipping and offshore centre. Cyprus has the tenth-largest ship registry in the world, with 1831 ships and approximately 23 million gross registered tons (GRTs) as at 30/09/06. It is an open registry and includes ships from more than 43 countries.

New Economic Era

With Cyprus’ accession into the European Union, as of the 1st May 2004, it has been able to offer more attractive investment opportunities to entrepreneurs and advantages to investors.

Cyprus has an open, free-market, service-based economy with some light manufacturing. The Tertiary sector (service sector) is the largest contributor to the Cyprus economy.

The Cypriot nationals are among the most prosperous people in the area. After its independence, Cyprus has enjoyed a thriving economic performance, reflected in rapid economic growth, full employment rates and external and internal stability.

Cyprus is classified among the high-income countries, with a per capita income of CYP£9,834 in 2005 (EUR 17.048). Its standard of living is even higher than some EU member-states and its economic performance compares favourably with that of most EU countries. The average annual rate of growth is about 4.0%, while inflation stands at 2.0% and unemployment at 3.0 % for the period of 2006.

Business Environment

There are many factors that have contributed to making Cyprus a favourable environment for doing business.

The characteristics of the business environment in Cyprus reveal the advantages and flexibility Cyprus offers as an international business and financial center:

1. Cyprus is considered to be a low tax country rather than a tax haven country;
2. The island has an extensive double tax treaty network, currently with 41 countries;
3. Friendly international relations;
4. Sophisticated infrastructure;
5. Excellent professional services with modern banking and insurance networks;
6. Highly-educated and versatile workforce;
7. Low operational costs;
8. High standard of living in a crime free environment;
9. High quality of primary, secondary and university education in foreign languages especially in English.

All these, coupled with the comparatively low operating costs, the high standard of living and the countless other lifestyle advantages on offer, make Cyprus the perfect place for today’s investors and business people.

Legal System

The legal system in Cyprus follows the English Legal structure and consequently all statutes relating to business matters and procedures are very similar to those of the English system. Most laws have been officially translated into English allowing foreign entrepreneurs to easily come to terms with the Cyprus Legal System.

Banking System

Cyprus’ banking industry is well developed and plays a predominant role and acts as an effective intermediate between savers and investors. Its system comprises of three categories of credit institutions: the domestic commercial credit institutions which presently, number 11 commercial banks and 3 specialised credit institutions, the co-operatives which offer a rather limited range of banking services basically, the acceptance of deposits and the granting of credit facilities to their members and shareholders, and the international credit institutions which until the end of 2005 were known as "International or Offshore banking units", 30 in number to-date. The banking system in Cyprus follows the British model and the monetary policy and the policy relating to credit and balance of payments is controlled by the Central Bank of the Island. All commercial banks are able to offer any kind of international financial transaction due to a well built correspondent network and are capable of adapting to an aggressive and competitive market. They are currently providing all the up-to-date electronic facilities that most international banks provide.

Accounting System

All accountants and auditors, providing services to the public, are approved by the Minister of Commerce. The approval is only given to qualified persons, members of recognised overseas accounting bodies.

The main accounting body in Cyprus is the Institute of Certified Public Accountants (ICPAC). The accounting profession is bound to follow the international accounting and auditing standards (IAAS).

Cyprus as a Member of the EU

Since Cyprus’ full membership into the EU it has been exposed to various economic advantages. Cyprus now participates and enjoys full access to the Union’s internal market allowing goods, services, workers and persons to move freely throughout Europe.

Citizens of the EU, as well as businessmen, are now experiencing the new business challenges and opportunities that this large economic market offers. Cyprus will certainly contribute and take part in the future growth and development of the EU by offering investment opportunities and providing comparative economic advantages to potential investors and business-men.

Cyprus is expected to join the EMU (European Monetary Union) and adopt the Euro as at 1.1.08. This will consequently result in lower inflation rates, lower interest rates, more investment and higher growth rate.