The beginning of 2025 has brought a significant revival in the investment sphere in Cyprus.
The island continues to attract foreign entrepreneurs who see it as a strategic centre for entering the European market.
According to the latest data, the number of foreign company registrations in Cyprus has increased significantly. Experts attribute this trend to the Cypriot government's consistent policy of improving the business climate and infrastructure.
In particular, from 1 January to 11 March 2025, 93 foreign companies were registered in Cyprus, which is 20% more than in the same period in 2024. In the first half of last year, around 200 companies were opened, creating 1.2 thousand new jobs. In 2022 (post-pandemic), 1,605 foreign companies were registered in Cyprus, an all-time record. In 2023, there was a decline with only 286 companies. However, 2024 was a year of recovery with 465 new companies by the end of the year. Experts believe that the number of new registrations in 2025 could exceed 2022 if the favourable trend continues.
Interestingly, the most active investors in Cyprus continue to be entrepreneurs from Israel, Ukraine, Russia, Lebanon, Belarus and the UK. In recent years, however, the Cypriot authorities have not limited themselves to traditional partners and are actively working to attract investors from new regions:
- Brazil - a memorandum of understanding has been signed with the state of Paraná to increase the number of South American companies on the island.
- Saudi Arabia and Jordan - there is a growing interest in investing in Cyprus in 2024.
- India and the US - there is a particular focus on energy, renewable energy and software.
To make Cyprus even more attractive to foreign companies, the government recently launched a major rebranding campaign. The international agency KREAB, which specialises in the image policy of states, has been hired for this purpose. The aim is to increase the confidence of international partners and get rid of the 'tax haven' stereotype. The authorities are also trying to prepare Cyprus for increasingly stringent European tax and financial requirements.
Although the corporate tax rate in Cyprus is set to rise from 12.5% to 15% from 2026, this will not discourage capital inflows. On the contrary, the move is seen as improving Cyprus' international reputation. It will allow the island to avoid accusations that it is an offshore zone with dubious tax policies. According to experts, the increase in the tax rate is insignificant and will not affect the attractiveness of the country.
It should be noted that the greatest activity in 2025 was recorded in the technology, finance and real estate sectors. In particular:
- IT and software development - fintech start-ups and video game companies are of particular interest.
- Real estate and construction - foreign investors are actively investing in residential complexes, commercial property and hotels.
- Hospitality - Cyprus remains a leader in Mediterranean tourism, so hotels and resorts continue to attract capital.
Foreign investment is expected to continue to grow in 2025 due to
- An improving business climate;
- Expansion of international partnerships;
- Strengthening Cyprus' position in technology and sustainable development.
If this trend continues, 2025 could be a record year in terms of foreign companies and capital inflows.