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Cyprus eyes mass industrialisation

The island state is set to emerge as the most lucrative investment-friendly destination

Cyprus has big-ticket projects in its masterplan as it gears up for a new industrial and investment profile. The strategically-located country at the crossroads of Asia, Africa and Europe, coupled with a foolproof infrastructure in the fields of communication, navigation and information technology is opening up for the world at large.
Its ambition is to revolutionise the industrial sector and ensure maximum incentives for potential investors. The island also eyes the tangible 500 million consumers right across the Mediterranean in Europe to maximise its market reach.

What makes Cyprus the indispensable destination when it comes to investment is its incentives, and the concern that the government has for the welfare and prosperity of businessmen. The EU-member state has the lowest double taxation in the region, i.e., 12.5 per cent, as well as double taxation treaties with more than 64 countries. Last but not least, it has an educated workforce and a modern commercial logistics and commutation network.
Cyprus is making extraordinary efforts to make it a magnet for world commerce in the region, and has much to benefit from its business-friendly policies as well as navigational edge. Likewise, the tourism potential is unprecedented as it attracts millions of visitors, and is one of the few destinations in Europe that has a tropical climate. The state of Cyprus is busy sponsoring a large number of projects, and wants to develop its base as an encouraging hub for industrialisation. Subsidies, incentives and tax concessions are some of the measures that the government has come up with to make it more attractive.

The government has taken a cue from successes in the tourism, education and construction sectors, and is now focusing on manufacturing. Under an 'integrated national industrial strategy', the ministries of commerce, energy, tourism and industry will work in tandem. This will be a boost to industrialisation plans thus helping convert the island-nation state into a buzzing smart destination. The aim is to account for 15 per cent of the GDP by 2030, making industrialisation the cornerstone of the economy. Presently, industry accounts for 7.9 per cent of GDP.

This policy is in relevance to EU industrial policies through focus on digital transformation, renewable energy and go-green projects. Cyprus has adopted this approach to be in tune with the best international standards as well as the requirements of the European Union. Part of the strategy is to open new vistas for finance and exports by broadening opportunities for foreign direct investment in high-tech and knowledge-based industries.

Presently, the fast-track visa programme is a major attraction for businessmen and investors. The government wants to build on that profile for new entrepreneurs. Similarly, the relevant ministries are working on plans to remove bottlenecks and red-tapism.

Cyprus has come a long way from being an agrarian economy to one that is industrialising rapidly. Some of the prospective industries are ICT, electronics, consumer products and heavy manufacturing. Pharmaceuticals, beverages, food, especially Halloumi cheese, and metallurgy are other avenues where Cyprus has made a mark for itself. The food industry is one of the most popular in the region accounting for more than 32 per cent of entire manufacturing. These are export-oriented products, ensuring foreign exchange for the state. Likewise, some 30,000 people - about 9 per cent of the workforce -  are employed in the manufacturing industry.

As Cyprus goes industrial, small and medium-scale manufacturers are its prime assets, and the relevant chambers of commerce and industrial organisations are in liaison for furthering growth and investment. The picturesque island in the Mediterranean is set to register itself as the most business-friendly destination in Europe and Asia.

- mehkri@khaleejtimes.com