In an ongoing bid to boost its recession hit economy, Cyprus has reaffirmed its position as a primary destination for foreign investment. The island received some $4.4bn in foreign investment last year, equal to a quarter of its total economic output.
A scheme set up in 2013 allows investors to contribute either €2 million towards property in Cyprus, or €2.5 million towards government bonds or companies. In exchange those investing have a chance to obtain Cypriot citizenship, often in as little as 6 months.
The scheme has proved particularly attractive to Russian investors seeking a way to join the European Union, benefitting from freedom of movement as well as the island’s privacy. Towns such as Limassol have become home to a number of Russian shops catering to this influx.
This is particularly surprising given the repercussions of the recession. The collapse of Cypriot banks hit wealthy Russian investors particularly hard, as only assets below €100,000 were protected. But the existing investors have largely stuck it out, and both parties are now reaping the rewards, with 90% of restructured bank loans also continuing to perform.
The political situation in Russia offers further incentive to move assets, if not to move out of the country altogether. Some wealthy individuals feel at risk from the instability of the current government, which has a track record of sudden confiscation and imprisonments
While there are some opponents to the scheme, the island has declared it an almost unmitigated success. The slide that reached its nadir in 2013 has been arrested, with growth up to 2.8% in 2016, making Cyprus one of Europe’s fastest growing nations. Russian tourism meanwhile is up 65%, providing a welcome boost to the local economy.
Other countries offer similar schemes to the one in Cyprus. Malta is a similarly inviting destination for potential investors, while the U.S. has maintained its EB-5 Immigrant Investor Program for almost 30 years. Proponents of these plans point to the money invested in otherwise struggling, local economies, providing jobs and reducing deprivation.
For more information on moving to Cyprus or anywhere else in Europe, do not hesitate to contact us. For further information on moving to the U.S., you can also visit our partners at Immigration Into America.