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Author: Prospectacy Business Services Team

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The Creation of a Sustainable Development Model is more necessary than ever

Yanna Raevskaya – Legal Department Manager at Prospectacy LTD

In recent years, Cyprus has embarked on an effort to diversify and expand the productive base of its economy, with the aim of creating a resilient and sustainable development model.

The multiple crises facing the country (inflation, energy, adaptation to the post-COVID era) make it necessary to accelerate this effort in order for Cyprus to emerge unscathed, and as strong as possible from this transition period.

To this end, the State’s policy focuses on attracting companies and professionals from abroad in key sectors, as well as strengthening existing pillars of the economy such as technology, education and research, health, renewable energy sources, financial and professional services, shipping, sports and the cultural industry. The extraction of know-how and capital in different sectors will lead to the enlargement and diversification of the productive base of the economy, creating horizontal multiplier benefits and quality jobs for the local population.

Necessary conditions for achieving these goals are the effective utilization and promotion of the country’s comparative advantages, the promotion of important reforms in the public sector, such as digital transformation and the modernization of the justice system, as well as synergies between the public and private sectors.

Rightly so, the Government, through the Ministry of Finance, announced the strategy for attracting companies to operate and expand their activities in Cyprus, which includes a series of incentives for businesses and professionals who wish to relocate to the country. Particularly important for enhancing the attractiveness of Cyprus are the provisions that facilitate access to the labor market for the spouses of professionals who choose to settle on our island. At the same time, the introduction of the Digital Nomad Visa and Cyprus Startup Visa Scheme strengthen Cyprus’ position as a destination for technology companies.

An ally in the State’s effort to attract investment is the domestic intellectual property regime (IP Box Regime). The IP Box Regime in Cyprus – which fully complies with OECD and EU guidelines – enables companies operating in our country to be exempt from taxation, at a rate that can reach up to 80% of of their profits, which fall under the IP Box Regime, which effectively reduces the tax rate from 12.5% ​​down to 2.5%. The regime includes patents, copyrighted software and other intangible assets.

Despite the difficulties it went through in previous years, the Cypriot economy showed resilience, while upgrading its position as a financial center. Our country brings together a series of characteristics that make it an attractive business destination. In particular, it has an extensive network of double taxation agreements that is constantly expanding, as well as a competitive tax regime. At the same time, it offers high-quality and low-cost support services, while an additional advantage is its geographical location and the fact that it offers access to developed markets in the Middle East and especially to the European market. At the same time, it guarantees a high level of quality of life, safety, mild weather conditions and a suitably qualified human resource. It’s no coincidence,

Building on its comparative advantages, Cyprus must move towards the new era with targeted reforms and policies, to strengthen its resilience in the face of external challenges, in a highly competitive and constantly changing business environment.

published by inbusinessnews

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The Impact of the Foreign Investor on the Limassol companies

In cooperation with IMH, Prospectacy proudly participated as the Main Sponsor at the 2nd Limassol Business and Investment Summit in Limassol, Cyprus. This event presented a wealth of information attempt to map the future of retail in Limassol. The main trends, challenges, and opportunities faced by retailers were in focus. Significant impetus is also recorded in the shipping sector where the potential for growth is huge. 

Entrepreneurship is synonymous with risk and uncertainty. As much as many try to deny it or reform it, change and entrepreneurship do not go together with “certainty”. The business person is the one who seeks change and invests in his country and abroad. It exploits it and invests in new products, new services, new methods and processes of production, new ways of distribution and new markets.

Entrepreneurship of Limassol

The decade we are going through is a milestone for the development of the local economy and entrepreneurship in Limassol, as the city of Limassol has seen unprecedented growth in recent years. Limassol has all the qualities to become the business star of the eastern Mediterranean, a city that attracts foreign investment and is slowly and steadily establishing itself as the headquarters of global multinational companies.

FDI is a key driver of economic growth and fortunately, Limassol has managed to attract significant investment in recent years. Of particular interest are global technological giants who choose the Cypriot city to install large data centers and international innovation centers, where after a few years many young Cypriots and young Cypriots with high qualifications will be working. The leading role that foreign companies will play in the coming years in the development of the economy will sharply increase demand with a positive impact on the country.

Trends, challenges, opportunities

After all, why do investors choose Limassol for large-scale projects? How can the city become even more attractive? Answers will be given by four key figures who will participate in a round table discussion as part of the 2nd Limassol Business and Investment Summit presented by Prospectacy Ltd and which will be held on June 3, 2022. The panel will include Max Portelli, CFO of BrainRocket and member of Techisland, Petr Valov, CEO of Exness and member of Techisland, Kevin Sweet, Vice President of Finance/Property CFO of Melco Cyprus and Oren Plotkin, Managing Partner of Emerland Real Estate by Gilad Shabtai.

The conference will attempt to map the future of retail trade in Limassol. The main trends, challenges and opportunities facing retailers will be in focus. A significant boost is also registered in the shipping sector, where the growth potential is enormous.

Education, industry and healthcare will be put under the microscope in an attempt to find solutions to the problems encountered in these industries.

A discussion will also be held regarding real estate. After all, a big challenge is balancing between attracting high-end international buyers and offering affordable housing to locals. Conference speakers will present overall the positive effects of the presence of foreign investors in the city and the ways in which the leading investment destination is called upon to adapt to the demands of the international market.

Who cares

The Conference to be held at the Parklane Resort & Spa, in Limassol, is considered one of the most important this year and is expected to attract the city’s business elite. It is aimed at owners, managing directors and other senior managers from businesses operating in Limassol, as well as government officials, diplomats, politicians, local administration and the media

Take part and get informed by the people in the decision-making centers about the main strategic goals, future development and prospects of Limassol. The Conference will also allow participants to understand how any expansion of their operations in the city will positively affect the course of their business. As last year, this year’s leading business event will also be an excellent opportunity to network and discuss with other Conference participants.

published by inbusinessnews

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Hosting Professionals from Ukraine and Russia

interview: Vasilis Zertalis – CEO of Prospectacy LTD

Individuals or companies escaping the war in Ukraine who choose Cyprus as their next destination will not only find protection and work. Many of them will be able to offer valuable experience and expertise to our country’s growing tech sector, says Vasilis Zertalis, CEO of the business services provider Prospectacy.

What role do you think Cyprus will take on as a business centre as a result of the Russia-Ukraine crisis?

In the past, when conflict has broken out in our broader region – such as the civil war in Lebanon and the war in the former Yugoslavia – Cyprus took in refugees and hosted employees from the affected countries. Indeed, many of them became Cypriot citizens and productive members of society. Right now, according to the UN Refugee Agency (UNHCR), around 3.4 million Ukrainians have fled their country, escaping mainly to EU member states. Some are expected to choose Cyprus as their next stop. Furthermore, it is likely that companies from Ukraine or Russia, some of which are already active in Cyprus, will choose to move their headquarters and staff to Cyprus. Beyond the humanitarian dimension of the issue, which is by far the most important, Cyprus could not only help the people fleeing Ukraine but also benefit from their expertise in a number of sectors.

Are there job/career opportunities in Cyprus for Russian and Ukrainian citizens? If so, in which sectors?

Ukraine has made a good name for itself in recent years when it comes to its performance in the technology sector, with Ukrainian tech workers considered among Europe’s best qualified. To prove my point, start-ups such as Grammarly, Readdle and YouScan, which are now popular worldwide, started in Ukraine and were later acquired by international conglomerates like Amazon and Snapchat. Furthermore, companies like Huawei, Siemens, Oracle and Samsung run research and development centres in Ukraine. As such, if individuals or companies from Ukraine choose Cyprus as their next destination, they will be able to offer valuable experience and expertise to our country’s growing tech sector. The same applies to Russian nationals, who are leaving their country due to uncertainty over the future of its economy and ties with the rest of the world. The recruitment of experienced, top quality human resources will help Cyprus in its effort to attract foreign companies and investments. Beyond the technology sector, it is a well-known fact that Cyprus is facing staff shortages across many sectors. As the Director-General of the Employers and Industrialists Federation (OEB), Michalis Antoniou recently pointed out, there are immediate staffing needs in the tourism, retail and hospitality sectors.

How can Cyprus become a technology hub and help companies from these countries move their headquarters?

Cyprus has many comparative advantages that make it an attractive headquartering destination for companies from around the world. Companies from Canada, the USA, Russia, Ukraine and Israel have already moved their corporate headquarters to Cyprus, which has helped boost not only the economy but also the island’s cultural diversity. Its geographic location, tax regime, highly educated local workforce, the use of the English language in the workplace, the high standard of the services sector, as well as the quality of life here are all taken into serious consideration by foreign companies. At the same time, the pandemic and introduction of remote working policies have further highlighted Cyprus’ advantages, leading more and more businesses and professionals to relocate to our country. The Government’s new investment promotion strategy is expected to contribute to the effort being made to establish the country as a leading destination for foreign companies and their staff. However, there is always room for improvement. The private sector and the State are once again being called to join forces to promote Cyprus abroad. At the same time, reform of the justice system is imperative so that we can boost our country’s competitiveness. Similarly, reducing bureaucracy is also key, in order to accelerate and simplify procedures. This could be achieved in conjunction with the state’s digital transformation.

As regards the challenge of recruiting human resources from Ukraine, I believe that solutions can be found so that they can start working in Cyprus straight away and become easily integrated into the workforce. As things stand, third country nationals wishing to be employed in Cyprus must present certification from their country of origin’s Justice Ministry, which is obviously hard for displaced Ukrainians to do. The OEB has suggested that these employees be initially allowed into Cyprus under a tourist visa, with the documentation process taking place at a later stage. The criteria for obtaining a Cyprus Digital Nomad Visa could also be broadened. This visa was recently introduced with the exclusive aim of attracting tech workers from third countries.

Which sectors have high investment prospects?

The Government’s new investment promotion strategy, which was published last October, indicates that Cyprus is focused on attracting companies operating mainly in the tech, maritime, innovation, research and development, biogenetics and biotechnology sectors, as well as in RES. Certain investments that have already been made in the technology sector have paved the way for the island to become a regional hub between Europe and Asia. It is worth noting that a recent study commissioned by Invest Cyprus showed that the economic impact of multinational tech companies operating in our country – such as Wargaming, Apella Games Ltd, Nexters, Easybrain, 3CX and more – reached €1.5 billion in 2020, with benefits felt across the entire economy, including the services, real estate, education, health and entertainment sectors, which increased state revenue even further. We must build upon this effort that has already begun, so as to further upgrade the country’s infrastructure to attract more innovative companies and renowned professionals, while also boosting Cyprus’ access to new markets within Europe and the wider region

published by invest cyprus

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Cyprus has a lot to gain from absorbing labor from Ukraine

Vasilis Zertalis – CEO of Prospectacy LTD

Due to its geographical location, Cyprus has always been a destination for hosting people who were forced to leave their countries due to war conflicts. For example, after the civil war in Lebanon and the Yugoslav wars, Cyprus hosted people and absorbed labor from the affected countries. Many of them are now Cypriot citizens and are productive units in the economy.

The ongoing war in Ukraine has created, according to figures from the UN refugee agency, 4.9 million refugees so far. Tens of thousands of these people will choose Cyprus as their next stop. Similarly, it is possible that companies from Ukraine or Russia, some of which are already active in Cyprus, may choose to transfer their headquarters and their staff to our country.

Beyond the humanitarian dimension of the matter, which is undoubtedly of the greatest importance, Cyprus can reap multiple benefits in terms of know-how and immediate needs, through the absorption of labor force from Ukraine and Russia. In particular, Ukraine has in recent years built a good name for its performance in the field of technology, while Ukrainian IT workers are considered among the most qualified in Europe. It is important to note that now globally known start-ups such as Gramarly, Readdle and YouScan started in Ukraine and were then acquired by international giants such as Amazon and Snapchat.

The attraction of human potential in the field of technology functions as reinforcement in the context of the effort to create a regional tech hub between Europe and Asia, in Cyprus. Already companies such as Wargaming, Apella Games, Nexters, Easybrain, 3CX have chosen our country for the establishment of their corporate base, taking into account the comparative advantages that Cyprus has such as the geographical location, the tax regime, the qualified domestic human resources, the high level of support services, as well as the quality of life. In fact, according to a recent study carried out by an audit firm on behalf of the Cyprus Investment Promotion Organization (Invest Cyprus), the economic impact of the presence of international technology companies in our country amounted to €1.5 billion in 2020.

In addition to the technology sector, Cyprus faces human resource shortages in several sectors. As the general manager of the OEB, Mr. Michalis Antoniou, pointed out in his statements, deficiencies also exist in the tourism industry, retail trade and catering, which makes finding solutions to facilitate the integration and direct employment of personnel from third countries necessary.

With the current data, in order to employ a person from a third country he needs certification from the Ministry of Justice of his country of origin, which in the case of Ukraine is difficult to do. OEB’s recommendation is that these personnel be accepted in Cyprus initially with a tourist visa and the certification process be done later. There could also be an expansion of the criteria required to obtain the Cyprus Digital Nomad Visa, a recently implemented measure aimed exclusively at attracting personnel from third countries, employed in the technology sector.

In recent years, Cyprus has made significant strides in establishing itself as a first-choice destination for companies and workers from abroad. However, there is always room for improvement. In this direction, the reform of the Judiciary is of major importance for strengthening our competitiveness, as well as dealing with the bureaucracy which can be achieved in combination with the digital transformation of the state, with the aim of speeding up and simplifying the procedures.

Evaluating the developments, as Cyprus we must move with speed, flexibility and implement targeted policies in order to attract more innovative companies and established professionals, while strengthening Cyprus’ accessibility to new European and regional markets.

published by inbusinessnews

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