Cyprus remains attractive to foreign investors

The share of investors intending to enter the Cypriot market or expand their presence has risen to 67%. For comparison, in 2024 it was 57%, and in 2022 only 29%.

The most popular area for investment remains the sale of goods and provision of services: 48% of investors link their new or expanded projects to it. This is followed by research and development (21%), business services, including shared service centres and data centres (19%), corporate headquarters (17%) and sales and marketing (15%).

Among businesses already present in Cyprus, 62% plan to scale up their activity over the next year, and another 29% intend to keep their business at the current level. We explained how company registration in Cyprus works: step by step, with real timelines and documents.

Investors name the tax system as the country's main strength, rated positively by 90% of survey participants. Next come the high standard of living (82%), political and social stability (65%) and the skills of the local workforce (58%). Cyprus's geographical position is seen as an additional advantage: the island is in the European Union and at the same time in close proximity to the Middle East, which allows companies to use the country as a European base for doing business in the region.

Investors see the high cost of energy as the main drawback: half of the survey participants called this factor unfavourable for doing business. In addition, 38% of respondents noted limited access to financing and capital, 35% bureaucratic and administrative barriers, and 33% weaknesses in transport and logistics infrastructure. Another serious problem remains the shortage of skilled workers.

Information technology and telecommunications play an increasingly visible role in the Cypriot economy: over the last decade the sector has grown by about 15% a year on average, and today it accounts for 17% of accumulated foreign direct investment in the country.

In the view of survey participants, Cyprus needs to accelerate the development of its technology infrastructure and artificial intelligence: 62% of respondents rank this among the priorities, 59% expect more active support from the state, and 56% consider it necessary to raise workers' technology and AI skills. Interest in technology projects is growing, but the local market still lacks specialists with the necessary skills.

In 2025 foreign direct investment in Cyprus rose to €82 bn after falling to €75 bn a year earlier. The historical high was recorded in 2022, when the figure reached €83.3 bn. Financial and insurance activities accounted for 42% of investment, real estate for 25%, and IT and telecommunications for 17%.

About 60% of those surveyed expect Cyprus's investment attractiveness to improve further over the next three years. The most promising areas are seen as real estate, infrastructure and construction (23%), tourism and leisure (14%), IT and telecommunications (14%), and payment technologies and fintech (11%).

To maintain Cyprus's competitiveness, 40% of survey participants consider it necessary to carry out major infrastructure and urban projects, 37% favour stronger support for high-tech industries and innovation, and 32% favour reducing the bureaucratic burden. Another 47% of investors call for simpler administrative procedures in light of the rapid development of technology and artificial intelligence.