Cyprus

As the easternmost member of the European Union, the Republic of Cyprus (ROC)  sits strategically at the crossroads of Europe, Africa and Asia. With a population of less than one million, this island offers a business-friendly environment and actively welcomes foreign direct investment (FDI) with a competitive corporate tax rate of 12.5% and other incentives. A highly skilled, English-speaking workforce and a well-developed legal and accounting infrastructure contribute to its investment appeal.

While economy relies primarily on service sectors such as tourism, finance, shipping and real estate, which together account for over 80% of GDP, the recent discovery of significant natural gas reserves has further driven FDI and fueled aspirations for a potential new driver of economic growth.

However, Cyprus also faces challenges. Public debt is on the rise, and the lack of economic diversification makes Cyprus vulnerable to external shocks.  Its financial and trade ties with Russia and Ukraine add another layer of risk. The island is also politically divided between the internationally recognized ROC and the Turkish Republic on the northeastern portion of the island, recognized only by Türkiye.