By Antonis Antoniou
Over the past couple of years there has been extensive speculation about the future of the Cyprus Investor Programme in the industry of immigration agents. However, Cyprus has made sure that the continious improvements imposed on the programme are pointing in the right direction creating a transparent and solid environment for investors and industry professionals.
On the 15th of May 2019 the Cyprus government revised the Cyprus Investment Programme for the 5th time in its history, since it was originally launched back in the year 2011. For the records, at that time, the program name was the Cyprus Citizenship by Investment and the moment it hit the market it was considered as a milestone for the industry, as it was the first EU member state to introduce a CIP.
The truth is, during the last announcment of the ministry of interior in Cyprus back in March 2019, many investors and industry professionals felt bewildered about the new changes that felt like moving the goal post once again, making it hard for immigration advisors to score.
The changes however, had only a pure and geniune goal. To make the programme transparent for those who have chosen to doubt the due diligence practices used so far. This has made it stronger and more resilient in a World were political changes could affect the borders globally.
New procedures and enchanced due diligence were introduced which now help to calm the voices of doubt in the European political elite but will also give a strong sign of confidence for those who depend on the programme. Particularly, the new regulations now emphasize the government’s determination to support a transparent evniroment in the immigration industry as it will demand that new investors provide a valid Shengen visa and additionally scrutinise them through an accredited world famous profile report service check.These measures didn’t come by chance, but only after strong arguments in the press, claiming that rich investors with uncertain criminal history found refuge in the Cyprus programme. Something which the Cyprus government strongly rejected repeadetely, claiming that these were false allegations.
As a result, the additional measures of improved backround checks will now reinforce the environment within which the programme operates. The country, which bounced back from the major meltdown of the bank crisis of 2013, recorded one of the fastest GDP growths in the Eurozone. Many political analysts and economists consider this as an economic miracle and a case study for other countries to follow. The success story of Cyprus however, goes back to 2014, a year after the programme was revised for the 3rd time. At the time the government put in practice a number of reforms and encouraged investors to speculate heavily in real estate. To boost the economy a number of other reforms took place, however, foreign investors with big budgets were the result of the programme leading to a surge of HNWIs on the island, therefore making the CIP the backbone of the Cyprus economy.
During those years, an outcry of European political parties followed the success, as they saw an outsell of passports. Similarly, in the lifespan of the programme there were many arguments, mainly locally as to the benefits it gave back to society due to the fast property price increase on the coastline which was the result of the robust demand from HNWIs for seafront properties. This demand made it impossible for locals to compete with the shocking prices which in some areas reached an astonishing 15,000euros per square meter.
Some analysts didn’t hesitate to unconditionally judge the government for not being able to control this price race, despite the fact that all accepted that the market forces of demand and supply should have to work independantly and allow the market to adjust to the circumstances.
With the new revised regulations howevever, investors applying after the 15th of May 2019 are obliged to donate the amount of €75,000 into the Housing Society Bureau which will accordingly support low income Cypriots who struggle to climb the property ladder. The one-off donation was gratefully welcomed by all political parties and also created a positive feeling within the public who amazingly saw property prices quadruple in some areas.
In addition, an amount of €75,000 must now be invested in a start-up company which also creates a very positive enviroment for young enterprenuers who want to use Cyprus as a base for expansion in Europe. In fact, a list of very promising start-ups have been shortlisted giving the abiility to the investor to choose from a wide and diverse catalogue of mainstream companies. Some have very impressive resumes and business plans including one which is deveoping a patented drug to fight cancer.
Apparently now, flying a drone over the skyline of the city of Limassol, or Ayia Napa’s coastline one must not only wonder about the rapid progress of high rise buildings that were the result of the Cyprus Investor Programme, but also must accept that in the name of progress, Cyprus has agreed to welcome these HNWIs and help them make the island their second home. This naturally not only creates inflation but, as some claim, a new version of the island. I personally call it Cyprus Version 2.
A country that now has a golden opportunity to offer it’s award winning services to wealthy people from around the World, ranging from hospitality, to education and finance but not restricting itself from a wide range of services to accommodate the needs of these investors and their families.
It’s a lifetime opportunity for enterprenuers to welcome these people and make them feel like they are home. This recipricates the value they have brought to the island and caters to their desire to live, work and play in a world without borders. After all it’s all about the undisputable right of people to freedom.
That is why it sometime makes me believe that the Cyprus programme is still young, and we, as industry professionals ought to protect it by strongly encouraging and applying the principles of effective due diligence that will make people give us a vote of confidence and make the Cyprus Investment Programme a great option for investors.