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In this page: FDI in Figures | Why You Should Choose to Invest in Cyprus | Procedures Relative to Foreign Investment | Investment Opportunities


FDI in Figures

In a context where global foreign investment increased by 10.9% in 2013, in particular in Europe (+25.2%) and in Latin America (+17.5%), FDI flows to developing economies reached a new high of US$759 billion. However macroeconomic fragility and policy uncertainties are driving investors to caution.

In recent years, Cyprus was ranked among the top destinations in terms of attractiveness for foreign direct investment. The country gradually removed most investment restrictions when it became a candidate for accession to the European Union. Sectors such as financial intermediation could benefit from these initiatives and Cyprus began receiving a large amount of FDI annually.

However, the influence of the international economic environment has been significant. FDI, which had fallen sharply in 2008 and 2009, primarily due to lower investment in real estate, has since been struggling to resume growth and in 2012 should be affected by the crisis in Europe and the Greek crisis. In 2013 FDI reached only over USD 840 million.

Tourism, wellness activities, medical services, development projects of natural resources (oil, gas), research and technology are the most promising areas for future investments. Almost complete liberalization of foreign investment increases the country's attractiveness.

The United Kingdom, the Netherlands, Russia and Panama were among the major investors in Cyprus in 2013. This same year,  Financial and Insurance Activities, Professional, Scientific and Technical Activities and Wholesale and Retail Trade were amongst the top FDI sectors.

Information on the 2013 FDI influx in this region can be accessed in the Global Investment Trade Monitor published in January 2014 by the United Nations Conference on Trade and Development (UNCTAD).


Country Comparison For the Protection of Investors

  Cyprus Eastern Europe & Central Asia United States Germany
Index of Transaction Transparency* 8.0 7.0 7.0 5.0
Index of Manager’s Responsibility** 4.0 5.0 9.0 5.0
Index of Shareholders’ Power*** 6.0 9.0 5.0
Index of Investor Protection**** 6.3 5.9 8.3 5.0

Source: Doing Business - Last Available Data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment 201120122013
FDI Inward Flow (million USD) 2,3841,257533
FDI Stock (million USD) 20,66621,04721,182
Performance Index*, Ranking on 181 Economies 43--
Potential Index**, Ranking on 177 Economies 129--
Number of Greenfield Investments*** 957
FDI Inwards (in % of GFCF****) 57.740.317.8
FDI Stock (in % of GDP) 83.292.497.0

Source: UNCTAD - Last Available Data.

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

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Why You Should Choose to Invest in Cyprus

Strong Points
The country's strong points are:
- Its European Union membership and use of the Euro currency;
- A corporate tax rate among the lowest in Europe;
- A strategic geographical location at the crossroads of three continents and in particular giving access to Middle-Eastern markets;
- A prosperous and stable economy;
- a skilled, multilingual and low-cost workforce; and
- High quality infrastructures, especially in the harbor sector.
Weak Points
The country's main weaknesses are:
- The division of the island since 1974 and the difficulties in reaching an agremeent between the Turkish and Greek Cypriots. This could have a negative impact on the country's appeal in the long term.
- The limited size of the domestic market should also be taken into account. Indeed, the population is not over 1 million inhabitants.
Government Measures to Motivate or Restrict FDI
The Cypriot government has created a positive environment for business. The government's liberal policy has promoted investment development. Some measures constitute the key points of the country's appeal:
- The possibility of 100% foreign shareholding in almost all sectors of the economy;
- One of the lowest corporate tax rates of the European Union;
- An attractive tax environment. Cyprus has signed the double-taxation treaties with more than 40 countries; and
- Particularly competitive corporate establishment and operational.
Bilateral Investment Conventions Signed By Cyprus
Cyprus has signed bilateral convention with about 10 countries. To this figure, we have to add the 26 other European Union countries. On the Mediterranean basin, and out of EU, Cyprus only signed bilateral conventions with Egypt and Lebanon. 7 conventions can be found on the UNCTAD. They define the protection framework of FDIs in Cyprus for each signatory country.

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Procedures Relative to Foreign Investment

Freedom of Establishment
Freedom of establishment is guaranteed.
Acquisition of Holdings
Foreign investors based in the European Union can acquire stakes in a Cypriot companies, without any limit on the percentage of stake acquired or on minimum capital invested. Moreover, investors from the European Union can acquire up to 100% in the capital of companies listed on Cyprus Stock market except for the banking sector where such a percentage is limited to 50% only.
Obligation to Declare
Licenses are required when operating in some sectors of the economy like construction.
Competent Organization For the Declaration
CIPA - Cyprus Investment Promotion Agency
Requests For Specific Authorizations
Apart from the licensing procedures, there are no particular authorizations that are needed.

Learn more about Foreign Investment in Cyprus on, the Directory for International Trade Service Providers.

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Investment Opportunities

Investment Aid Agency
Invest in Cyprus
Tenders, Projects and Public Procurement
Tenders Info, Tenders in Cyprus
Globaltenders, Tenders & Projects from Cyprus
Ted - Tenders Electronic daily, Business opportunities in EU 27
DgMarket, Tenders Worldwide
Other Useful Resources
Focus Business Services

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Learn more about Investing in Cyprus on, the Directory for International Trade Service Providers.

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Last Updates: October 2014