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Greece, Russia and the UK - do they remain the largest foreign investors in region?
Posted on: 4/28/2015 10:31:00 PM under General News
Tourism has long been a driving force of the Cypriot economy and arrivals as well as expenditure have seen an increase despite the crisis. In April 2014, arrivals increased by 11.4% year-on-year and revenues recorded a healthy rise of 20.4%.
Another recent coup for Cyprus in terms of FDI was the decision of one of the world’s leading hospitality and resort management companies, Buena Vista Hospitality Group, to base its regional headquarters in Cyprus and to develop the largest wellness resort in Europe with an investment of $300 million. The rapidly expanding investment fund sector is an exciting development in Cyprus and could become a multi-billion-euro industry. With a solid Mutual Funds framework in place and recently upgraded Alternative Investment Funds (AIFs) legislation, Cyprus has great prospects to establish itself as a new regional market and a thriving fund centre.
The majority of cumulative FDI stock has traditionally been invested in the country’s key three service sectors of financial services, real estate and wholesale trade – with Greece, UK and Russia being the largest foreign direct investors in Cyprus. FDI into Cyprus peaked at €2.5 billion in 2009, but fell back to just under €800 million in 2010-11, largely as a result of the global financial crisis. It must be noted that official statistics underestimate the true size of FDI, as they exclude investment generated by the large number of companies without a physical presence in Cyprus. In regard to FDI flows in Cyprus, the economic activity that attracted significant investments was the financial and insurance activities sector. In particular, there was an increase of €1,186 million in 2012, compared with an increase of €982 million recorded in 2011. Inward foreign direct investment in Cyprus was €979 million in 2012, according to revised data from the Central Bank of Cyprus.