“We are not competing with Tel Aviv, we are competing with other European countries,” Invest Cyprus CEO George Campanellas said during a one-on-one roundtable at the agency’s office in Nicosia. told CTech. “Your startup country is in Israel, what do startups do? They scale up. Start looking at Cyprus as a location, and that’s the gist of what we’re trying to do with Israel, which is to make Cyprus fit into the scale-up plans of Israeli tech companies.”
Last month, CTech received an invitation to visit Cyprus on behalf of the Cyprus Investment Promotion Agency, Cyprus Investment Promotion Agency, to learn more about its recent efforts to transform it into a European technology hub. Geographically so close to Israel and with the opportunity to enter the EU market, it was a trip too good to pass up. The country has always been known for lax tax laws and lax regulations, but this time it felt different. The country has high hopes for its post-pandemic future, and it was meant to show us what awaits.
“What we have been trying to do over the last few years, and it has been moving very rapidly lately, is to develop Cyprus as a hub for technology companies,” explains Campanellas. “The ‘office in name only’ model was discontinued years ago. We are no longer talking about PO boxes. I need an entity. ”
Today, Cyprus has a population of about 920,000 with a median age of 38. Due to its location in the Mediterranean Sea, it has long served as a trading post in the East and enjoyed industrial success in the maritime sector. It now makes up her 7% of the country’s population. GDP. Major trading partners include EU member states Greece, Germany, Italy, France, UK, Israel and China. Its legal system is based not only on English common law principles, but also on European law as laid down by the EU.
Its status has always meant it is an attractive option for companies wishing to enter the EU market and obtain regulatory licenses that can be easily administered in other countries. Where the country has found success at sea, it now wants to find success again in the ever-expanding tech startup space.
Invest Cyprus is dedicated to attracting and promoting foreign direct investment into the country. We work with government authorities and the private sector to maintain and extend the country’s international standards in the legal and operating environment for doing business. It is clear that government agencies are eyeing the award. In other words, the vision of Cyprus 2035 is to help the country become a place where people can move to live and do business. The FDI (Foreign Direct Investment) rate has reached €22.2 billion ($23.8 billion; NIS 81 billion) over the past decade, largely thanks to the shipping and travel sectors. More recently, investments in communications have been driving growth.
CTech’s visit to Cyprus helped us get a first-hand understanding of the state of the company and what it plans to attract more talent from around the world. We visited Cyprus companies NIPD Genetics and ecommbx in the biotech and fintech industries respectively and explored the University of Nicosia. Forever visionary, this institute has the world’s first degree with ‘Metaverse and NFT’ due to start next year.
“NFTs are the most interesting area in the crypto space,” said Antonis Polemitis, the university’s CEO, of the technology focus. “Perhaps it will replace Facebook.”
Founded in 1980, the University of Nicosia became the first university in the world to offer a Master of Science degree in Blockchain and Digital Currency in 2014 and the first institution to accept Bitcoin for tuition payment. Its “Institute for the Future” division recently embarked on a partnership with his Binance Charity, the philanthropic arm of cryptocurrency and blockchain infrastructure provider Binance, to provide scholarships for the program. According to Polemitis, students at the University of Nicosia come from Greece, Cyprus, USA, UK, Israel, Lebanon and Australia, in that order.
CTech was also invited to visit the Troodos Observatory, which is currently under construction and designed in hopes of bringing international “space travel” to the country. Scheduled to open in the summer of 2023, it will be an astronomical center working in collaboration with other European and international organizations. Reid will also collect data for research to share with NASA, according to Elena Tsolakis, her architect.
So while Cyprus is working to attract businesses and young talent to the country, it has become clear that much of that effort has relied on importing immigrants to tackle high-paying technical jobs. Invest Cyprus acknowledges that efforts at the government level to improve the education of local Cypriots are inadequate. “We haven’t seen any real reform in our education system yet,” Campanellas tells his CTech. “But tech companies are part of society, and these companies have a lot of his CSR programs.”
It is concerning given how much emphasis is being put on outside talent to fill the positions the country wants. If someone from the UK, US or Israel secures a highly paid position, it could foster resentment from locals who feel they are missing out on opportunities. Without swift action by the government and the current tendency of universities to favor students from abroad, it could be years before Cypriots finally catch up with immigrants from other countries. ”
One of the companies that has settled in Cyprus is Israeli social trading and multi-asset investment firm eToro. Shortly after its establishment in 2007, eToro opened an office in the city of Limassol. It acts as the Group’s European brokerage arm, serving clients throughout the Member States of the European Union. R&D and marketing activities remain in Israel, but his Cyprus office is home to 250 of his people from all over the world.
“I think Limassol is closer to Tel Aviv and Nicosia is closer to Jerusalem,” joked eToro Chief Operations Officer Avi Sela. The company held his CTech in a seaside town about 40 minutes from Nicosia to better understand the incentives to set up stores in Nicosia. “Very business-friendly and open to innovation. You can find people here who actually introduce and test new technologies and are willing to listen and evolve.”
An attractive feature of Cyprus, apart from its 15% corporate tax rate and access to European markets, is the fact that it can serve as a testing ground for products and services. By its nature as an island, Cyprus offers what Invest Cyprus calls a “low-risk test market” for Israelis to make improvements before expanding further.
According to Sela, eToro’s office is made up of both local and overseas-educated personnel. Apparently, it is common in Cyprus for locals to be educated in key locations such as the UK or the Netherlands and then return to settle in a few years later. It is based in Limassol, classified as a ‘global city’ by the Cities Research Network.
The city has proven popular for Israeli companies looking to relocate to Cyprus. There are about 1,000 Israeli families in the area, and he keeps one of his three Chabad Houses in the country to foster the Jewish community.
“Cyprus has been a good host to us over the years,” Serra said. “Cyprus has turned out to be very important to us. They have the right mentality. They are talented. A lot of focus. Good match.”
CTech’s visit to Cyprus helped change the way we think about what the country wants to achieve in the future. First and foremost, we want to tarnish our reputation as nothing more than a tax haven. Once established offices are set up by foreign companies, we hope to foster an environment for innovation comparable to Israel. We want to keep the tourism and maritime sector while increasing opportunities for fintech and communication. The hope is that it will become a legitimate option for businesses that can take advantage of everything the country has to offer.