Filenews 5 November 2021
The Cypriot government on Friday presented to the business community its new strategy to attract and facilitate the expansion of foreign companies in Cyprus, focusing on facilitating the processes to attract talent especially in the fields of technology, innovation, shipping, research and development, during a round table discussion at the Presidential Palace.
The new strategy was formulated after government ministers listened to the problems and demands of foreign businessmen, some of whom during the round table discussion expressed strong grievances about lengthy procedures or "inhumane behaviours" of government agencies, expressing the hope that the vision included in this new strategy will be incorporated by government agencies.
During his presentation, the Minister of Finance, Konstantinos Petrides, said that the vision for a new Cyprus is being realized and thanked the investors who chose Cyprus as a place of business, a place of residence and investment, consumption and expansion of their business.
"In collaboration with you we have tried to obtain a holistic incentive program to help expand your business in Cyprus," he said.
The Minister also said that after the investors indicated certain distortions such as the need to facilitate the process of settling workers, the need for tax incentives, the opening up of access to the labour market to the spouses of workers, the need for incentives to attract talent but also for fast licensing procedures, the Government incorporated all this into the incentive programme. He added that this is an example that government policy moves quickly without getting lost in bureaucratic procedures.
He also said that the programme will come into force from January 1, 2022 provided that two bills are passed by the House and noted that the Government is committed to tabling the bills by the end of the year.
The Minister also told investors that their presence in Cyprus enhances the resilience of the country's economy and contributed to mitigating the effects of the pandemic. "You are one of the factors that contributed both to a lower recession in Cyprus than in other European countries, but also to a faster recovery by 2022," he said.
For her part, the Minister of Energy, Trade and Industry Natasa Pilidou said that the new strategy and the Business Facilitation Unit is an upgrade of the Mechanism of Rapid Activity of International Companies that began in October 2020, which was embraced and succeeded despite the limited simplifications it introduced. He added that the Mechanism attracted 22 companies from around the world.
"So there is every reason to be optimistic about this new strategy, because it includes everything we have learned from you," he said, noting that the goal is not "just to introduce incentives, but to make people's lives easier."
Employment of third-country nationals
Interior Minister Nikos Nouris said that the government's strategy facilitates existing companies and is trying to attract more foreign companies wishing to do business in Cyprus.
"We believe that such a development will be a catalyst for the creation of growth momentum and conditions for the long-term strengthening of our economic prosperity," he said.
Regarding the employment of third-country nationals, he said that the new strategy cancels quotas for managers, specialists and key staff positions. Companies, he added, can freely employ any number of highly qualified third-country nationals under certain simple conditions. He also said that the new strategy further encourages family reunification in order to facilitate the employment of third-country nationals.
"By modernizing all the above procedures we are moving away from the bureaucratic procedures of the past by facilitating businesses and applicants from third countries," he said.
He said that as of January 1 of this year, almost 270 new companies have already been registered with the register and immigration department for the employment of third-country nationals with favourable provisions compared to 198 that were registered in 2020. On November 1, he said, nearly 600 residence permits were approved for employment purposes in foreign companies compared to 480 at the end of last year, which was an increase of almost 25%.
"We believe that the above reforms will directly contribute to the increase of liquidity and will create a large inflow of new capital from abroad," he said, adding that they expect additional jobs.
Deputy Minister of Research, Innovation and Digital Policy Kyriakos Kokkinos said in his speech that the new strategy establishes "a new kind of relationship, an approach to cooperation and dialogue on how to interact with each other".
He stated that the strategy includes an action plan with time frames "for dynamic implementation" and asked the companies operating in Cyprus to contribute and work closely together for the Cypriot digital transformation.
Highlighting the geographical position of Cyprus, Mr. Kokkinos stressed that the country is a natural choice to be recognized as the technological capital of the Eastern Mediterranean.
"We want to contribute and make a vibrant, sustainable pillar of the economy through working with you. Together, I firmly believe that we can co-create our future and shape digital Cyprus."
Foreign businessmen
Alexey Gubarev, co-founder of Bala, praised the advantages of Cyprus and referred to the islands technology initiative that aims to accelerate innovation and technological development in Cyprus with members of 140 companies employing 7,500 people in Cyprus. "We live here, we see Cyprus as a home and we want to grow with it," he said.
Hamza Afifi, BrainRocket's Public Relations Director, said his company began operations in Cyprus in 2020 and currently employs 300 people and aspires to reach 1,000 by 2022.
"Cyprus is in a strategic position in the middle of Africa, Asia and Europe," he said.
However, he added that during the operation of the company they faced challenges especially with the immigration department and added that the fast process will help the company to meet its needs. "When people take us to make an appointment in Limassol with the Migration Department it takes about two months, and if we had a quick process it would be very useful to attract talent from non-EU countries," he said.
In addition, Arthur Mamedov CEO of The Soul Publishing, a Limassol-based company with 400 employees, of which three quarters are local hires, spoke of a "fundamental improvement".
He also referred to the problems related to immigration as the company "shops talents around the world", noting that talents will not only look at pay but will consider how a country would help them settle and the path to citizenship.
Prabha Jha, Ceo of the MSCH Shipmanagement Group, said that since 2008 the Cyprus office has been operating 470 ships, making the office the largest shipping company in the world from an office, adding that the company contributed more than 30 million euros to the local economy.
It welcomed the new steps taken that allow for long-term work permits, family reunification and allow spouses to work. "These are steps in the right direction," he said, expressing the hope that the Ministers' vision "will reach the last person working in the Migration Department and any other departments."
Complaints about lengthy procedures
An Indian businessman who said he has been working in Cyprus since 1989 complained about the lengthy procedures in the various government departments.
He spoke of inhumane treatment in many government offices, said they should carefully choose their words for people of another colour, and expressed the hope that they could do better with a computer, "since dealing with some human beings in these offices is truly inhumane." He said that two months ago there were 160 calls in two weeks for a very simple matter to the Population Department to make an appointment, something they failed to do and they were forced to pay 200 euros to a mediator they found opposite the street and the matter was settled in one day.
"We came because many of us fell in love with the island, the nature of the people, the cultural heritage and the environment," he said, noting that he now moved his activities to Norway.
He also expressed his great disappointment about the destruction of the environment in Cyprus, the forest fires, the destruction of the coastline and the uncontrolled traffic problem, noting that "it seems that municipalities are absent, it seems that the government is indifferent. In conclusion, he called for Cyprus to set the protection of the environment "as a supreme need for the country".
