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Cyprus: Mediterranean pearl reviving its economic luster
February 8, 2015, 9:14 am
His Excellency Panicos Kyriacou

Long before Cyprus and Kuwait formally established diplomatic missions to each other in 2011, the two countries had trade links that go back to the early seafaring traditions and maritime history of the two peoples. “Our strategic location in the Mediterranean, close to mainland Europe and in the immediate neighborhood of Middle-East, means we have had historical and commercial links with both regions for centuries. We are closer to Africa and the Middle-East countries of Syria, Lebanon and Egypt than we are to Europe,” said His Excellency Panicos Kyriacou Ambassador of the Republic of Cyprus to the State of Kuwait at the start of an exclusive interview with The Times Kuwait.

The ambassador, who studied law at the University of Greece before moving to the United Kingdom to do his Masters in International and European Community Law, joined his country’s Ministry of Foreign Affairs in 1991.  “I received my initial posting to Nairobi, Kenya in 1992 and then to London. With my background in Law, I was then assigned to the European Union’s Permanent Representatives Committee in Brussels as Coreper 1, which handled the technical affairs of the Union. In 2007, I received my first appointment to the Middle-East as my country’s ambassador to Qatar. After my four-year tenure in Doha, in 2011, I was tasked with opening our embassy here and appointed as the first resident ambassador of Cyprus to Kuwait,” said Ambassador Kyriacou.

“The deep and abiding ties of Cyprus to the Middle-East gave rise to many social and cultural similarities, including in their traditions, customs, cuisines and other ways of life. For instance, as in the Arab world, family is the center of social life in Cyprus. New Year, Easter, Christmas and other events are more than just religious or cultural festivals for us; they are a time for immediate and extended families and friends to come together and share their kindred spirit. In our family, my wife and children have lived with me wherever I have been posted. It is only now, that they have grown up, that my elder son and daughter will live away from us in order to go to college.

“It is perhaps our shared customs and other societal commonalities that encouraged many Kuwaitis to seek shelter in Cyprus during the Iraqi invasion in 1990; they bought houses there and got to know and interact with local Cypriot communities. The strong people to people contacts that were established then led to growing appreciation for the Cypriot way of life and many more Kuwaitis now have homes and properties across Cyprus.

“Bilateral relations between our two countries received a boost in October 2013 with the official visit to Kuwait by the Cypriot President Nicos Anastasiades. The president was accompanied by a high-powered delegation that included ministers of foreign affairs, finance and energy, as well as over 60 leading Cypriot business representatives. During the visit a series of bilateral agreements were signed between the two sides, including on double-taxation and in areas of health, tourism and education. Addressing a business forum jointly organized by the Cypriot and Kuwait Chambers of Commerce and Industry, the president said that ongoing restructuring and rejuvenating of the Cypriot economy meant that the country would continue to be a reliable partner and an attractive destination for entrepreneurs and investors.

“Since the presidential visit, there have been a number of initiatives by Cypriot business people to explore the Kuwait market with a view to setting up business here. There are also several construction companies from Cyprus who are actively looking to participate in the development projects being undertaken by Kuwait. The embassy here and the Kuwaiti embassy in Nicosia are doing everything we can to facilitate the growth of bilateral trade and commerce between our two countries,” noted the envoy. 

Following the impact of global financial crunch in 2008 and the European banking crisis in 2012, the Cypriot economy is now steering a clear and steady path towards recovery. Despite challenges, the country with its strong track-record in attracting foreign direct investment (FDI), is once again gaining the attention of international investors and charting its way to growth and development.

The ambassador added, “In late 2013, Cyprus announced a series of incentives to drive property growth and real-estate developments by offering permanent residency permits to third country nationals who invest over US$350,000 in the country’s property market. Additionally, foreigners can buy an apartment or villa for around $100,000 or more and use it as holiday-home or as a real-estate investment with lucrative appreciation potential, without the need for any permission or clearance from the government.”

However, the ambassador emphasized that there was an important caveat that people who want to invest in Cypriot real estate should be aware of. “The international community has recognized the de jure authority of the Republic of Cyprus over the entire island and its waters. “This poses a problem for potential investors who might unknowingly buy property, or be misled into buying realty, in the occupied part of our island.

While the real estate sector with growing global investments in residential, retail, hospitality and leisure properties continues to be the mainstay of the reviving Cypriot economy, tourism, banking and financial services, and the huge potential from offshore drilling of hydrocarbon reserves are also fueling the country’s steady economic recovery.”

Elaborating further on investment opportunities in Cyprus, Ambassador Kyriacou said, “With various sectors of the economy ripe for investments and strong growth prospects, Cyprus can be an enticing investment proposition for Kuwaitis. Besides having one of the most competitive corporate tax structures in Europe and low income and labor taxes, Kuwaiti businesses looking to invest in Cyprus can also take advantage of the bilateral double-taxation agreement that exists between our two countries. Additionally, Cyprus also has a liberalized FDI policy, transparent regulatory framework and special incentives to entice investments, including the option of permanent citizenship for those willing to make investments of US$2.5 million or more in the Cypriot economy. “

Pointing out that tourism plays a significant role in his country’s economic growth, the envoy noted, “With 340 days of sunshine a year, millions of tourists from around the world flock to Cyprus each year giving the country one of the highest ratio of population to tourism arrivals in the world. In 2013, the tourism sector, which accounted for 12 percent of our national GDP, drew more than 2.4 million visitors to Cyprus and brought in over US$2 billion in revenue.

“Though its land area is smaller than Kuwait, Cyprus is an island of geographic contracts. Within half an hour’s drive you can go from sandy beaches to pine-scented mountains; you can enjoy basking on sunny beaches in summer or go skiing on snow-clad slopes in winter. With a history spanning over 10,000 years, Cyprus is both a modern European country and a land dotted with historical and archeological sites that bear witness to ancient Greek, Roman, Byzantine and Ottoman eras in our island’s history. 

“The Cypriot tourism sector is rapidly expanding and diversifying its portfolio of products. Increasingly the country is being promoted not only for its scenic landscape, traditional hospitality and sustainable tourism, but also for its high-end travel and leisure products, including health and beauty spas, luxury marinas and 18-course golf-links.

“In line with this push to offer attractive and differentiated tourism products, the government plans to launch new marinas and integrated waterfront developments in tourist hubs such as Larnaca, Paphos and Ayia Napa. The new projects are expected to complement the existing exclusive Limassol Marina, which has proven to be very popular with the international crowd. Sport tourism is also likely to get a further boost with the plans already underway to increase the number of 18-hole golf-links from the current four to eleven, and make Cyprus a destination of choice for golf-lovers around the world.

“Our long and enduring relations with Kuwait have made Cyprus a preferred holiday destination for many citizens and residents here. Since last October, travel between our two countries has become even more convenient with Gulf Air beginning thrice-weekly direct flights from here to Larnaca.  Kuwait Airways may also start scheduling flights to Cyprus once new planes are added to their fleet and you also have the option of flying to Cyprus on several regional airlines.

“To further enhance people to people relations we are also looking at bilateral cultural exchanges. The embassy is planning to hold a Cypriot Food Festival in April, where we will bring renowned chefs from Cyprus to provide local palates with a taste of our cuisine. We are also eager to have a musical troupe perform here and to organize an exhibition of products from Cyprus in the immediate future. Moreover, with the aim of expanding tourism to Cyprus, we are talking to various stakeholders, including airlines, hotels and travel promoters, to offer a unique travel package to those wanting to visit Cyprus,” said the ambassador in conclusion.

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