Cyprus’s initiative to attract specialists from the diaspora through tax incentives has generated significant debate and divided opinions. According to the BBC World Service Business Daily program, the “Minds in Cyprus” project offers Cypriots who have lived abroad for at least seven years a 25% tax discount and additional benefits. However, despite the potential advantages, returnees and local residents point to possible risks — from social inequality to pressure on the housing market.
Tax incentives and criticism
The main idea of the initiative is to make returning to Cyprus more attractive for skilled professionals. Nevertheless, some Cypriots believe that such benefits may lead to conflict between local workers and those who return.
Pavlos Cleantou, founder of the IT company Parsectix, who returned to Cyprus 12 years ago, noted that coming back is a personal choice, and tax bonuses should not be the deciding factor. He emphasized that he chose to hire only Cypriots so that young specialists could build their careers at home rather than going abroad.
Housing challenges and new state measures
One of the most pressing issues remains the real estate crisis. According to Irini Piki, the government has already adjusted certain programs. In particular, young families under the age of 41 can now immediately receive state housing subsidies without the previous requirement of two years of residence on the island.
However, Piki did not clarify how the authorities plan to handle even a moderate inflow of 3,000–5,000 returnees. Experts warn that given the existing housing shortage, the situation could worsen if additional measures are not introduced.
Economic outlook and challenges
The initiative has also highlighted another problem — the division of Cyprus’s economy into two sectors. In Nicosia, traditional companies focused on the domestic market dominate, while in Limassol foreign firms prevail, with up to 90% of employees being expats, mainly from Russia and Ukraine. These companies serve international clients but have little interaction with the local economy.
Cleantou stressed that without a strategic approach, the government risks intensifying internal competition. According to him, Cyprus must build stronger ties with international markets; otherwise, companies will be forced to cut prices and quality to survive.
Attracting investment and global interest
Despite criticism, authorities insist that the program will help close staffing gaps in key sectors — IT, healthcare, education, and green technologies. According to Piki, the focus is not only on employees but also on entrepreneurs who may relocate their businesses to Cyprus.
During a recent roadshow in the United States, the delegation met with major companies in New York, Texas, and Silicon Valley. Executives were primarily interested in access to skilled talent, rather than tax incentives themselves.
Diaspora reacts cautiously
Some young Cypriots abroad view the program positively but are in no rush to return. For example, 28-year-old lawyer Nicholas from London said that career growth remains the decisive factor for him, while tax bonuses could only serve as an additional incentive.
Economists also suggest looking at the initiative more broadly. In their view, the diaspora contributes value not only through taxes but also through investments, knowledge transfer, and international networks. According to a Commonwealth study, the combined investment potential of diasporas in 56 countries exceeds $73 billion, opening new opportunities for startups and venture funds.
Temporary incentives and next steps
Under the government’s plan, tax breaks will last for seven years. Piki explained that this timeframe is intended to offset relocation and resettlement costs but emphasized that it would not create long-term inequality. At the same time, the program remains only a proposal — its implementation still requires parliamentary approval.