Cyprus may break its record for tourist arrivals from France this year, according to Deputy Minister of Tourism Kostas Koumis.

Speaking during a series of meetings in the French capital, Koumis, who is leading Cyprus’ delegation at the 2024 IFTM tourism exhibition, expressed optimism that arrivals from France could surpass last year’s figure of 80,000 visitors.

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According to a press release by the Deputy Ministry of Tourism, Koumis had discussions with senior officials from tourism organisations and airlines operating between France and Cyprus. The focus of the talks included the continued growth of the French market in Cyprus, which is expected to set new records this year, as well as visitor satisfaction and efforts by the ministry to promote niche tourism. 

At the IFTM exhibition, the Cyprus delegation hosted a breakfast featuring traditional Cypriot cuisine, in line with the “Cyprus Breakfast” initiative. Notable guests included Valerie Boned, President of the French Association of Travel Agents, and Lawrence Gaborieau, Director of the IFTM exhibition. The annual event is one of the largest and oldest professional tourism exhibitions in the world, attracting thousands of industry professionals.

The French market has seen a significant 25% increase in tourist arrivals to Cyprus from January to August 2024 compared to the previous year, and an impressive 217% rise compared to the same period in 2019.

Koumis highlighted that the French market had been slow to grow in Cyprus due to several factors, most notably the preference of French tourists for French-speaking destinations. However, he pointed out that in recent years, there has been a notable surge in French arrivals, with this year expected to set a new record.

“We must conduct a thorough analysis of the profile of the French visitor,” Koumis said, adding that recent surveys show French travelers are particularly conscious of environmental issues and green development. “They assess destinations based on sustainable practices, which is why green transition efforts are essential for the future of tourism.”

Koumis further emphasised the importance of continuing to attract French tourists in the coming year, building on this year’s high performance while considering evolving trends in visitor preferences.

“About 50% of French tourists prioritise sun and sea destinations, but we are also seeing a growing interest in lesser-known locations, which is a dynamic trend that extends beyond France,” he said.

In a significant move to bolster its international partnerships, Invest Cyprus has strengthened economic ties with India, one of the world’s fastest-growing economies. The collaboration aims to attract investment, boost bilateral trade, and create new opportunities across multiple sectors, marking a key step in Cyprus’ strategy to position itself as a global business hub.

As part of this initiative, the Cyprus Investment Promotion Agency (CIPA), operating under the Invest Cyprus banner, is working to deepen connections between Cypriot and Indian businesses, particularly in technology, renewable energy, and financial services. The move underscores Cyprus’ commitment to expanding its economic reach and building strategic alliances beyond Europe.

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India, with its vast market potential and growing influence on the global stage, is an attractive partner for Cyprus. By fostering closer economic relations with India, Cyprus stands to benefit from increased foreign direct investment (FDI), trade partnerships, and knowledge exchange in key industries.

The recent discussions between Invest Cyprus and Indian officials have highlighted shared economic interests and opportunities for collaboration in areas such as information and communication technology (ICT), energy, fintech, and pharmaceuticals. With its favourable tax regime, strategic geographic location, and robust legal framework, Cyprus offers Indian businesses an ideal gateway into Europe, the Middle East, and Africa.

Technology and Innovation at the Forefront

One of the key sectors highlighted in this partnership is technology. Cyprus has rapidly emerged as a growing tech hub, attracting startups, multinational companies, and investors looking to leverage its business-friendly environment and growing talent pool. For India, a global leader in IT services and innovation, this partnership opens up new avenues for collaboration, particularly in areas such as digital transformation, artificial intelligence, and blockchain technology.

The emphasis on technology aligns with Cyprus’ broader goal of establishing itself as a regional leader in innovation and digital economy initiatives. Through joint ventures and partnerships with Indian tech firms, Cyprus can further strengthen its capabilities in these areas, while Indian companies gain access to European markets and business networks.

Renewable Energy and Sustainability

Sustainability and renewable energy are also central to the discussions between Invest Cyprus and India. Cyprus is looking to diversify its energy mix and reduce its reliance on fossil fuels, and Indian companies, with their expertise in renewable energy solutions, could play a pivotal role in this transition.

The growing demand for clean energy solutions presents a prime opportunity for Indian firms to invest in Cyprus’ renewable energy sector, contributing to projects related to solar, wind, and energy storage. This partnership aligns with Cyprus’ commitments to the European Union’s climate goals, as the island nation seeks to accelerate its green energy transition.

The Cyprus government has submitted its proposed state budget for 2025 to the Council of Ministers, outlining three primary goals aimed at securing economic stability and fostering sustainable growth. This budget comes at a time when Cyprus is navigating a post-pandemic recovery while contending with global economic challenges, including inflationary pressures and geopolitical uncertainties. The proposed financial framework reflects the government’s commitment to fiscal responsibility, social welfare, and green development while seeking to strengthen key sectors of the economy.

1. Fiscal Discipline and Economic Stability

The first priority of the 2025 state budget is to maintain fiscal discipline and ensure economic stability. Cyprus has demonstrated resilience in recent years, recovering from the COVID-19 pandemic’s economic fallout and managing inflationary pressures. However, the government remains cautious about external factors such as rising energy costs and global market volatility.

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The budget aims to strike a balance between controlling public debt and continuing to support growth. Measures to improve revenue collection, manage public spending efficiently, and reduce the fiscal deficit are central to this goal. By adhering to fiscal prudence, the government seeks to safeguard Cyprus’ financial standing while maintaining investor confidence.

2. Strengthening Social Welfare

The second key focus of the 2025 budget is on enhancing social welfare and improving the standard of living for all citizens. The government plans to allocate substantial resources to healthcare, education, and social security, addressing inequalities exacerbated by the pandemic. Investments in healthcare infrastructure, digitalisation of public services, and expanded social protection programmes will be essential to this effort.

In addition, the budget includes targeted measures to support vulnerable groups, including low-income families, the elderly, and the unemployed. By increasing social spending, the government aims to ensure that the benefits of economic growth are shared across all segments of society, promoting social cohesion and reducing poverty levels.

3. Promoting Green and Digital Transformation

The third strategic pillar of the 2025 budget is the promotion of green and digital transformation, aligned with the European Union’s sustainability and innovation goals. The Cypriot government is committed to meeting its climate targets and transitioning towards a more sustainable economy. Investments in renewable energy, energy efficiency, and green technologies will form a significant part of the budget. These initiatives will not only help reduce Cyprus’ carbon footprint but also stimulate job creation in emerging sectors.

On the digital front, the budget outlines plans to enhance digital infrastructure and foster innovation across industries. By promoting digitalisation, the government aims to increase productivity, attract foreign investment, and make Cyprus a competitive player in the global digital economy. This includes the ongoing modernisation of public administration and further investment in ICT (Information and Communications Technology) to improve the efficiency of government services.

The Athens Stock Exchange, following a meeting of the Listings and Market Operation Committee, verified that all listing prerequisites for the listing of the Bank of Cyprus shares have been met and approved.

More specifically, according to the decision, “the Athens Stock Exchange, following today’s meeting of the Listings and Market Operation Committee, verified that all listing prerequisites are met and approved the listing of 443,457,297 ordinary shares of “BANK OF CYPRUS HOLDINGS PUBLIC LIMITED COMPANY” (ISIN: IE00BD5B1Y92) on the Main Market of the Athens Stock Exchange, according to art. 2 par. 4 L.3371/2005”.

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It is mentioned that trading will start on Monday, 23 September 2024.

As global markets keenly await the Federal Reserve’s next move, all eyes are on the central bank’s decision regarding interest rates. The Federal Reserve (Fed) is set to reveal its stance soon, and the decision comes amid a complex balancing act between controlling inflation and sustaining economic growth. The upcoming announcement is poised to have far-reaching implications for both domestic and global markets, with the central question being: Should the Fed raise rates, keep them steady, or take a more dovish approach?

Inflation Versus Economic Stability

At the heart of the Federal Reserve’s dilemma is the delicate balance between curbing inflation and preventing an economic slowdown. While inflation rates have eased in recent months, they remain above the Fed’s 2% target, keeping the central bank cautious. The inflationary pressures that emerged post-pandemic, driven by supply chain disruptions and increased consumer demand, have proven difficult to fully tame. Higher interest rates are the Fed’s primary tool to control inflation, as raising the cost of borrowing typically cools consumer spending and investment.

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However, higher interest rates come with the risk of slowing down the broader economy, particularly in sensitive sectors such as housing and manufacturing. There is growing concern that continuous rate hikes could stifle growth, leading to a potential recession. Several industries are already feeling the pinch of elevated borrowing costs, and further tightening of monetary policy could exacerbate this.

A Divided Federal Reserve

Inside the Federal Reserve, there appears to be a division of opinion. One camp advocates for further rate hikes, arguing that inflation remains a significant risk and that the Fed must take firm action to meet its price stability mandate. They argue that a failure to control inflation now could lead to more severe economic issues later, forcing even more aggressive measures.

On the other hand, there is a faction within the Fed that is cautious about overcorrecting. These policymakers stress the importance of allowing previous rate hikes to fully work their way through the economy before implementing additional increases. They point to signs of slowing growth and rising unemployment as indicators that the economy is starting to respond to earlier rate hikes and that further increases could prove counterproductive.

Market Expectations and Global Impact

The financial markets have been closely watching the Fed’s moves, with volatility reflecting the uncertainty surrounding the upcoming decision. Investors and businesses alike are grappling with how to position themselves in the face of possible rate changes. A rate hike would likely strengthen the US dollar, affecting global trade balances and commodity prices. Conversely, holding rates steady might signal a shift in the Fed’s approach, offering some relief to sectors reliant on lower borrowing costs.

Internationally, the Federal Reserve’s decision will also ripple through other economies, as many central banks tend to align their policies with the US to maintain competitive currency exchange rates and manage inflation within their own borders.

Tourist arrivals set a new record in August, reaching 554,923, exceeding the corresponding arrivals of August 2019, the record year for Cypriot tourism, by 0.20%.

According to Cystat, from January to August 2024, tourist arrivals totaled 2,758,627 compared to 2,648,795 in the corresponding period of 2023, recording an increase of 4.1%.

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Compared to the arrivals of tourists in August 2023, arrivals in August 2024 went up by 8.5%.

Arrivals from the United Kingdom were the main source of tourism for August 2024, with a share of 34.7% (192,424) of total arrivals, followed by Israel with 13.3% (74,032), Poland with 7.7% (42,650), Germany with 4.2% (23,068) and Sweden with 4.1% (22,508).

Returns of residents of Cyprus down 3.6%

Moreover, a total number of 192,756 residents of Cyprus returned from a trip abroad in August 2024 compared to 199,920 in the corresponding month last year, recording a decrease of 3.6%.

The main countries from which residents of Cyprus returned in August 2024 were Greece with a share of 39.1% (75,381), the United Kingdom with 6.6% (12,718), Russia with 4.4% (8,538) and Italy with 4.1% (7,926).

The Council of Ministers approved on Tuesday a proposal by the Energy Ministry regarding the electricity interconnection between Cyprus and Crete (Great Sea Interconnector – GSI), the competent Minister George Papanastasiou has announced.

In statements to the media on Tuesday afternoon, the Minister said that the Republic of Cyprus will pay €25 million per year for five years, strictly, to subsidize a possible increase in electricity bills, from 1/1/2025-31/12/2029 so that consumers will not bear the burden of this increase.

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Papanastasiou noted that the project will contribute to lifting Cyprus’ energy isolation, as it will connect the national electric energy system with the respective electricity systems and will increase energy security.

He went on to say that the project is particularly significant for growth and the prosperity of the inhabitants of the island, noting that the aim is to reduce the cost of electricity, through the electricity interconnection, by importing natural gas and via the use of renewable energy sources.

Moreover, he said that the project’s significance is verified by the fact that the EU approved its financing through the Connecting Europe Facility with the record amount of 657 Euros.

According to the Minister of Energy, the Council of Ministers decided that the Republic of Cyprus will pay €25 million per year strictly, for 5 years, to subsidize the increase that may occur in electricity bills for the right to recover costs during the construction period interconnection, i.e. from 1/1/2025-31/12/2029, so that consumers do not bear the burden of the increase.

This money will come from the Consolidated Fund of the Republic of Cyprus and more concretely from the pollution rights auction system and the first installment will be included in a supplementary budget.

“Today’s decision of the Council of Ministers is the culmination of many consultations with all the stakeholders and the clarifications that have been given so that the Republic of Cyprus has before it real data regarding the financial, technical and legal aspects of the project”, Papanastasiou pointed out.

He added that the Government demonstrated “the necessary responsibility and due diligence that should characterize the decision-making regarding projects of such scope, with the sole aim of serving the interests of the Cypriot people, to whom we are accountable.”

The Minister noted that in the immediate future, and based on the road map that has been drawn up, the Government will be in constant communication, both with Greece and with the European Commission, for the further progress of the implementation of the project, but also with parties that have already shown a real interest in participating in the project.

A meeting of all GSI stakeholders took place a week ago, at the Presidential Palace, under Cyprus President Nikos Christodoulides, to discuss the GSI issue.

Cyprus-based startup Avanti has successfully raised €300,000 through the crowdfunding platform Crowdx, marking a significant milestone in its growth journey. The funding round highlights the growing role of crowdfunding in the local startup ecosystem and Avanti’s potential to scale within the competitive tech landscape.

Avanti, which focuses on developing cutting-edge solutions in the travel and hospitality industry, attracted wide interest from both local and international investors. The successful crowdfunding campaign demonstrates the increasing confidence in Cyprus’ startup ecosystem and the willingness of individual investors to back innovative ventures.

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A Strategic Funding Move

Crowdfunding has become an increasingly popular financing mechanism for startups seeking to raise capital without relying on traditional venture capital or bank loans. Avanti’s decision to raise funds through Crowdx is particularly strategic, as it allowed the company to leverage a broad base of investors while also fostering a community around its brand.

The €300,000 raised will be directed towards product development, expansion efforts, and scaling its operations across new markets. The company is poised to enhance its offerings in the travel-tech sector, focusing on improving the customer experience and creating digital solutions tailored to the evolving needs of the hospitality industry.

The travel and tourism industry is undergoing a digital transformation, driven by changing consumer behaviour, sustainability demands, and the need for enhanced operational efficiency. Startups like Avanti, which are nimble and innovative, are in an ideal position to take advantage of these shifts, positioning themselves for growth in a rapidly evolving market.

A Boost for Cyprus’ Startup Ecosystem

Avanti’s successful crowdfunding campaign is also a reflection of the maturing startup ecosystem in Cyprus. While traditionally dominated by sectors like tourism and financial services, the island is increasingly becoming a hub for tech startups, bolstered by supportive government policies and growing access to funding.

Crowdfunding, in particular, has emerged as a critical funding avenue for Cypriot startups. Platforms like Crowdx have facilitated easier access to capital for early-stage companies, offering an alternative to more traditional forms of fundraising. This trend signals the growth of Cyprus as a hub for tech-driven innovation and entrepreneurship.

The European Union has approved a payment of €152 million to Cyprus as part of its Recovery and Resilience Facility (RRF), marking another milestone in the island nation’s post-pandemic recovery efforts. The payment, confirmed by the European Commission, is part of a broader package designed to support Cyprus in implementing reforms and investments that align with the country’s Recovery and Resilience Plan (RRP), particularly targeting green and digital transformations.

This payment is the third disbursement from the RRF to Cyprus, bringing the total amount received to €484 million, almost half of the €1 billion allocated to Cyprus under the EU’s NextGenerationEU recovery instrument. The financial injection will further boost Cyprus’ efforts to tackle the socioeconomic challenges posed by the COVID-19 pandemic, improve infrastructure, and support the energy transition.

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Economic and Structural Reforms

Cyprus’ RRP, which has been in place since 2021, is centred on key reforms to stimulate economic growth, enhance competitiveness, and ensure the nation’s long-term resilience. The reforms target critical sectors, including renewable energy, digital infrastructure, and the modernisation of the public administration system.

The latest tranche of funding from the EU underpins the government’s commitment to an energy transition, with specific investments in renewable energy projects, such as photovoltaic installations, energy storage, and smart grid technologies. The RRP also seeks to accelerate the digitisation of public services, a critical area for modernising Cyprus’ economy and enhancing efficiency.

Moreover, the payment is expected to fuel the green transition through investments in sustainable agriculture and energy efficiency projects. These initiatives are aligned with the EU’s overarching goals of reducing greenhouse gas emissions and achieving carbon neutrality by 2050.

A Broader Context of Recovery

The approval of this payment not only highlights Cyprus’ successful management of the RRF but also signals broader confidence in the country’s recovery trajectory. With its economy heavily reliant on tourism and services, Cyprus was hit hard by the pandemic. However, the RRF, combined with national efforts, has provided a critical lifeline, allowing the government to fund projects aimed at boosting economic resilience.

This latest EU approval underscores the pivotal role the RRF plays in driving forward economic reforms that promise not only short-term recovery but also long-term sustainable growth for Cyprus.

A recent report on the labour market in Cyprus has revealed a worrying increase in illegal employment, even as the rate of undeclared work shows signs of decline. The findings, which were discussed during a parliamentary session, have raised concerns among lawmakers and authorities alike about the ongoing challenges in combating labour exploitation and maintaining fair employment practices.

According to data presented by the Ministry of Labour, the issue of illegal employment—workers being hired without proper work permits or contracts—has escalated in recent months. This rise comes at a time when efforts to reduce undeclared work, where employees are not registered or insured, have seen moderate success. Despite progress in regulating the labour market, illegal employment remains a significant issue, especially in industries such as construction, agriculture, and hospitality.

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Understanding the Distinction Between Illegal and Undeclared Employment

Illegal employment refers to the hiring of individuals who are not legally permitted to work, often due to their immigration status or lack of proper documentation. These workers are typically vulnerable to exploitation, receiving lower wages and lacking access to basic protections such as healthcare and social security benefits. In contrast, undeclared work involves the employment of individuals who may be legally allowed to work but are not officially registered, depriving them of insurance coverage and other legal protections.

While authorities have made strides in reducing undeclared work, particularly through stricter inspections and penalties, the rise in illegal employment presents a new challenge. Lawmakers pointed out that illegal employment poses even greater risks, as it not only harms the workers involved but also undermines the integrity of the labour market and contributes to unfair competition among businesses.

Factors Driving Illegal Employment

Several factors contribute to the increase in illegal employment, according to the Ministry of Labour. One key driver is the influx of migrant workers, many of whom lack the necessary documentation to work legally in Cyprus. Without proper channels for legal employment, these individuals often turn to unregulated jobs where they are vulnerable to exploitation.

The growing demand for cheap labour, particularly in sectors like construction and agriculture, also plays a significant role. Employers seeking to cut costs may resort to hiring illegal workers, bypassing the legal requirements for contracts, wages, and benefits. This practice not only puts workers at risk but also creates an uneven playing field, where businesses that comply with legal standards struggle to compete with those exploiting illegal labour.

Efforts to Combat Illegal Employment

In response to these findings, the government has pledged to intensify its efforts to combat illegal employment. This includes increasing inspections, imposing harsher penalties on employers found guilty of hiring illegal workers, and strengthening collaboration with immigration authorities. Additionally, there is a push to create more pathways for legal employment for migrant workers, ensuring they can enter the labour market with proper documentation and protections.