Cyprus is one of the quickest ways to get residency or citizenship in the EU.
Walk down one of the quiet streets in Paphos on the south west coast of Cyprus and it’s likely you will see a local property developer’s for-sale sign in Chinese in the window. The soon to be crowned European Capital of Culture for 2017 along with Aarhus in Denmark, is one of the country’s most diverse cities and its home to an influx of wealthy Chinese immigrant investors.
After the Eurozone crisis in 2008, property prices in Cyprus dropped by around 15 per cent, this was followed by more doom and gloom in 2013 with a local banking crisis that forced the government to close down Cyprus’s second largest bank, inflicting huge loses on those with deposits exceeding €100,000 and restructure two more, in a bid to keep Cyprus in the Eurozone. But despite the negative prognosis at the time, the country today has reemerged with a clean bill of financial health.
That’s not to say that it hasn’t been a troublesome few years, according to the IMF, the Cypriot economy only started growing again in 2015 after annual declines of 2.5 per cent in 2014, 5.9 per cent in 2013, and 2.4 per cent in 2012. However, the outlook for this year remains positive with the economy projected to expand by 2.9 per cent, and by another 3.2 per cent in 2017, according to the University of Cyprus.
Cyprus’s housing market is also expected to continue to improve in the coming months, amidst continued economic recovery, improvements in the banking system, and increasing investor confidence due to the passing of new laws that over tax incentives and protect homebuyers from fraud.
The economic recovery is most evident in Limassol, where a new casino resort will be developed in an area west of the city, close to the city’s waterpark and shopping mall. Paphos also has redevelopment plans over the next 10 years, including a new marina, a new port and a network of new roads around the city. Another marina project is being developed in Ayia Napa in the east of the country. Its been reported that these projects alone will inject €1 billion into the local economy over the next 2-3 years, a major boost to an economy with a GDP of €17.6 billion, according to the World Bank.
Cyprus has been a global business centre since the 80s. Thousands of foreign companies are registered and operating on the island due to favourable taxation for offshore entities — made available to all companies with the accession of Cyprus to the EU in 2004.
“It’s also considered the safest country in the world among countries with a population of less than a million, this coupled with the year-round pleasant climate and a legal and business system based on the Anglo-Saxon model are all contributing factors to the rise in foreign investment in recent years,” says Akis Kyradjis, vice president of Arton Capital Cyprus, a global advisory firm that specialises in Immigrant Investment Programs.
Substantial natural gas discoveries in the Eastern Mediterranean, some of which are in the exclusive Economic Zone of Cyprus have also resulted in companies like Exxon-Mobil, Total, ENI, Qatar Petroleum to set up o ces on the island, in the hope of further exploration for gas and possibly oil.
“Cyprus is becoming a regional energy hub owing to its membership of the EU and the fact that it is a peaceful patch of land in a very rich but turbulent area,” said George Tsielepis, Managing Director of Costas Tsielepis & Co Ltd, a boutique tax and business advisory rm in Cyprus.
Apart from the energy sector, Cyprus’s hospitality sector has also bene tted from foreign investment with Limassol — home to the country’s main port, attracting shipping magnates of German and Greek origin. The latter are a late addition to an already bustling business community due to the problems of the Greek economy.
Yet despite all of these profitable sectors, one of the most valuable is the country’s citizenship-by-investment programme, which was established in 2013 to attract foreign investment. The programme was revised in September 2016 and is attracting considerable interest among wealthy foreign investors, as it is the fastest path to EU citizenship – three months to approval of citizenship applications. Moreover, the investment threshold for investment in residential property has been reduced to €2 million thereby making it more attractive. To obtain permanent residence in Cyprus, investors from outside the EU have to spend at least €300,000 on a property. They must also prove that they have no criminal record and are in good financial standing and agree to deposit €30,000 for a minimum of three years in a local bank account.
The Cyprus Citizenship by Investment Programme, launched in May 2013 to raise funds after the local banking crisis, is one of the quickest ways to get residency or citizenship in the EU.
Cost: Applicants must invest a minimum of €2 million in residential property of which €1.5 million can be liquidated after three years. Higher investment thresholds apply for investment in shares, bonds, financial products and other types of property. A residential property with a contract price of €500,000 has to be kept by the main applicant for life. The programme now allows parents of the main applicant and/or the spouse to secure citizenship as well by accompanying the application of the main applicant and by making an additional property investment of €500,000.
Criteria: This is a flexible plan with no need to live in Cyprus, provided you arrange your investments correctly.
Benefits: Citizenship gives you a Cypriot passport and the freedom to work, travel, and live anywhere within the EU. You also have visa-free travel in more than 150 countries, although Cyprus doesn’t belong to Schengen.