The Cyprus Attractiveness Forum: Investment Realized, organized by EY in collaboration with the Cyprus Chamber of Commerce and Industry, took place on Tuesday, October 25th at the Parklane Hotel, in Limassol. The event brought together government leaders, CEOs, CFOs, entrepreneurs, investors and advisors from Cyprus and abroad to discuss the findings of the Cyprus Attractiveness Survey 2022 and the future of investment and business in Cyprus.
Participants were welcomed by Ronald Attard, Country Managing Partner, EY Cyprus & Malta, Strategy and Transactions Leader for CESA region and Andreas Demetriades, Vice President, Cyprus Chamber of Commerce and Industry.
The findings of the EY Attractiveness Survey Cyprus 2022 were presented by Stelios Demetriou, Partner, Head of Strategy and Transactions Services, EY Cyprus, with live commentary from Constantinos Petrides, Minister of Finance of the Republic of Cyprus.
According to the survey, although planned FDI activity in Cyprus, at 29%, remains low compared to the rest of Europe, investors are optimistic about the prospects of Cyprus’ attractiveness in the short-term future, with 53% of respondents expecting an improvement in the next three years.
Attractive areas for investment in Cyprus are in supply chain and logistics operations (35%), followed by sales and marketing offices and activities (24%), and headquartering (14%). Notably, manufacturing activity (7%) is also mentioned for the first time.
Investors consider telecommunication and digital infrastructure, Cyprus’ quality of life, and favorable corporate taxation as the most prominent features of the country’s attractiveness, while the entrepreneurial and start-up culture, the level of support measures and subsidies from public authorities and labor costs are perceived as less attractive.
Investors’ perception is that Cyprus should orientate its efforts towards allowing for regulation to keep pace with technological and other developments, supporting high-tech industries and innovation, as well as investing in manufacturing projects.
The survey confirms that Cyprus’ broader geopolitical situation continues to cast its shadow over companies’ decisions to invest in the country. As with the 2020 survey, close to half of the investors surveyed rendered the above as a “critical” (12%) or a “very important” (33%) factor.
Based on the findings of the survey, EY presented a number of recommendations aimed at improving Cyprus’ attractiveness centered around eight pillars:
- Retaining focus on digital economy by further investment in digital infrastructure, supporting digital skilling/reskilling of workforce, further digitalization of government services, actively promoting digital culture and the uptake by the general population.
- Helping to match skills to current and future employment needs, by encouraging the development of new and specialized higher education institutions, and promoting the active cooperation between the industry and academia.
- Establishing an entrepreneurial ecosystem where start-ups and SMEs can flourish and grow sustainably. Simplifying processes, improving transparency and the sharing of information, transiting fully to e-government, facilitating alternative funding and providing incentives for R&D and innovation.
- Accelerating efforts to establish Cyprus as a regional technology and innovation hub, by joining forces with relevant stakeholders to improve incentives and subsequently build a comprehensive ecosystem to support the ICT sector and its growth. Collaboration between the public and private sector to ensure effective access to the global tech community and effective communication of Cyprus’s competitive advantages.
- Intensifying effort to diversify the economy into dynamic new sectors, including supply chain & logistics, energy, education and health, while also supporting the transformation of traditional sectors (like tourism, professional services and shipping).
- Supporting the efforts of the financial services sector to regain its health, become more agile, achieve efficiencies, and concentrate on the funding of innovative and sustainable projects.
- Embracing sustainability, by creating the appropriate culture, developing the necessary skills, establishing the regulatory framework and facilitating the education and sharing of information.
- Capitalizing on recent geopolitical developments by exploiting our EU membership, strategic location, and other competitive advantages in the region, with the overarching aim of in gaining a key regional role in fields like energy and supply chains.
The panel discussion on ‘Cyprus as an attractive investment destination’, was moderated by Stelios Demetriou, Partner, Head of Strategy and Transactions Services, EY Cyprus, with the participation of Savvas Perdios, Deputy Minister of Tourism, George Campanellas, CEO, Invest Cyprus, Yannis Matsis, Managing Director, Head of Cyprus, MUFG Investor Services and Eliza Livadiotou, Director of Finance and Board Member, Bank of Cyprus.
Stelios Demetriou remarked: “The second edition of our survey clearly shows that Cyprus is on the right course to strengthening its competitive position. Against a background of global uncertainty and turmoil, participants’ responses show a marked improvement over 2020 and optimism about the future. However, we need to remember that, in today’s intensely competitive environment, our European partners are all striving to attract investment and are also making significant progress. With this in mind, we can now explore the next steps to improve Cyprus’ FDI attractiveness by leveraging the insights gained through this survey.”
Following the discussion on survey results, H.E. U.S. Ambassador to Cyprus, Judith Garber, gave a keynote speech where she referred to Cyprus as ‘a natural center of innovation’ and said that ‘it was great to see that shown in the results of the EY Attractiveness Survey Cyprus 2022’.
Antonis Oikonomou Public Sector Director for Microsoft Greece, Cyprus, and Malta proceeded with a speech on ‘Good practices and impact of digital innovation’.
The second panel discussion focused on the ‘Role of innovation and digital in driving attractiveness’. It was moderated by George Kousis, Executive Director and Chief Technology and Operations Officer, Bank of Cyprus with the participation of Kyriacos Kokkinos, Deputy Minister for Research, Innovation & Digital Policy of the Republic of Cyprus, Dr. Nikolas Mastroyiannopoulos, Chief Scientist for Research & Innovation of the Republic of Cyprus, Andreas Neocleous, CEO, CYTA and Maria Markidou Georgiadou, Managing Director, Cyprus Seeds.
This was followed by a message from Ms. Annita Demetriou, President of the House of Representatives of the Republic of Cyprus, and an insightful talk by Famke Krumbmüller, EY EMEIA Leader, Geostrategic business group, who spoke on the ‘increasing importance of Geopolitics for business leaders’. During her speech, Famke stressed that ‘we’re going through a fundamental structural change which creates both risks and opportunities that businesses will need to assess’.
The third roundtable discussion focused on ‘Developing a sustainable growth model for Cyprus’. It was moderated by Nick Nicolaou, Partner, Assurance, EY Cyprus with the participation of George Lakkotrypis, Former Minister of Energy, Commerce and Industry, Theodosis A. Tsiolas, Permanent Secretary, Directorate General for European Programmes, Coordination and Development (RRF), Andreas Assiotis, Vice Chairman of the National Economic and Competitiveness Council of Cyprus and the Chairman of the Steering Committee of the country’s Long Term Economic Strategy and Irene Georgalla, Head of Economic Diplomacy, Ministry of Foreign Affairs.
Christos Paschalides, Senior Economic Advisor/Member of the European Commission Recovery and Resilience Task Force, gave a keynote speech on EU’s Perspective and Priorities.
Finally, a fourth panel discussion, moderated by Panayiotis Thrasyvoulou, Partner and Head of People Advisory Services, EY Cyprus, on ‘Reframing education and redesigning the future of work’, was joined by Yiannis Mourouzides, Director General, Human Resource Development Authority of Cyprus (HRDA), Marios D. Tsiakkis, Secretary General Cyprus Chamber of Commerce and Industry, Maria Theodorou, Head of Human Resources Department of the Cyprus Employers & Industrialists Federation (OEB) and Professor Eleni Stavrou, Director of MSc HRM, University of Cyprus.
Ronald Attard, Country Managing Partner, EY Cyprus, in his closing remarks, referred to the findings and recommendations of the survey while stressing the vital contributions by participants. Mr. Attard noted: “Cyprus emerges as an attractive destination, with a marked improvement compared to our 2020 survey and rising optimism regarding further improvement of the country’s attractiveness over the next three years. We have identified a wide range of areas where we need to focus our efforts and improve, but there is no doubt in my mind that technology, sustainability and skills are the fields where investors will be focusing in the coming years. Foreign investment is a unique tool and a prerequisite for transforming our economy, by opening up new dynamic sectors, creating wealth and jobs and subsequently setting Cyprus on a sustainable growth path. With this in mind, EY is committed to establishing the Cyprus Attractiveness Forum as a flagship event that will regularly assess Cyprus’ progress in attracting FDI, identify and analyse emerging trends, exchange insights and ideas and together help formulate proposals that will place Cyprus at the forefront of investors’ interest.”
To read the full EY Attractiveness Survey Cyprus 2022 visit EY Attractiveness Survey Cyprus 2022 | EY – Cyprus.