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CBC publishes credit institutions’ interest rates for July 2024

by THEFUTURE.TEAM

September 11, 2024

The Central Bank of Cyprus (CBC) has released its latest report on the interest rates offered by credit institutions across the country for July 2024, shedding light on the economic landscape in a period marked by evolving global financial conditions. With interest rates playing a critical role in shaping the borrowing and investment behaviour of businesses and individuals, these figures offer valuable insights into the health of the Cypriot economy.

According to the CBC’s data, interest rates on deposits remained relatively stable compared to previous months. The interest rate for new deposits with a maturity of up to one year held at an average of 0.82%, while overnight deposits for households saw a marginal decline, reaching 0.04%. This slight decrease in overnight deposit rates reflects the broader market’s conservative approach to short-term liquidity, a common trend as economic uncertainty continues to weigh on the eurozone.

For businesses, the rates on overnight deposits remained flat, standing at 0.00%, underscoring the low-yield environment that has persisted for much of the year. This pattern aligns with European Central Bank (ECB) policies, which have kept interest rates subdued to manage inflationary pressures while stimulating investment. As a result, businesses and investors are navigating a challenging environment where low interest rates offer limited returns on traditional savings, potentially pushing them toward riskier, higher-yield investments.

On the lending side, the CBC’s report highlights a slight increase in interest rates for new loans. The interest rate for loans to households for consumer credit increased to 5.80%, up from the previous month’s figure of 5.69%. Meanwhile, loans for house purchases were offered at an average rate of 4.34%, a modest rise compared to June. This uptick, while not dramatic, signals potential concerns around inflationary trends and the cost of borrowing for households.

For businesses, the lending environment remained dynamic, with rates for loans up to €1 million rising to 5.74%. This upward movement reflects broader economic shifts, as businesses face higher borrowing costs in the wake of inflation and tightening global financial conditions.

Cyprus Showcases Its Business Advantages At 2024 London Event

by THEFUTURE.TEAM

December 5, 2024

Cyprus seized the opportunity to present itself as a premier destination for high-net-worth individuals (HNWIs) at the ‘Non-Doms: The Cyprus Private Client Offering Gathering 2024,’ held at the iconic London Stock Exchange. The event attracted over 150 participants, including professionals from the UK and experts from Cyprus, all gathering to explore Cyprus’ business advantages.

The gathering aimed to strengthen ties between the international investment community and Cyprus, highlighting the island’s competitive tax regime and wealth management opportunities. The central focus was Cyprus’ strategic appeal for non-domiciled residents, particularly as changes to the UK’s tax framework prompted many HNWIs to reconsider their tax and residency options.

A Shift in Global Tax Dynamics

With the UK government’s decision to abolish its long-standing non-dom tax regime, Cyprus stands poised to become an attractive alternative. The UK’s new residence-based system, set to take effect in April 2025, could direct more wealthy individuals and businesses toward jurisdictions like Cyprus, known for its fiscal benefits and strategic location in the Eastern Mediterranean.

Marios Tannousis, CEO of Invest Cyprus, and George Pantelis, former Director General of the Finance Ministry, addressed how Cyprus is uniquely positioned to capitalize on this shift. Their presentations underscored the island’s stability, tax benefits, and favorable environment for both personal wealth and corporate operations.

Key Highlights from the Conference

One of the highlights of the event was the panel discussion titled “Cyprus: A Destination of Choice for HNWIs, Their Families, Companies, and Employees.” Experts like Christos Neokleous, Consultant at Tsirides Law, outlined the simplicity of doing business in Cyprus, emphasizing the ease of setting up companies and understanding the regulatory environment.

Andreas Andronicou, Partner at PwC Cyprus, discussed the significant tax advantages for both individuals and corporations looking to operate from Cyprus, especially within the European and global markets. The country’s legal framework, based on the English Common Law system, was another focus, with Melina Dionysiou, Director/Head of Corporate at Totalserve, explaining its business-friendly aspects.

A Strategic Business Environment

Cyprus’ status as an international business hub is further reinforced by its competitive tax rates, skilled workforce, and advantageous legal system. These factors, combined with its prime location, make it an ideal choice for companies seeking to expand into new markets. Moreover, the conference highlighted the island’s growing appeal to foreign investors and companies, with opportunities ranging from tax-efficient corporate structures to residency-by-investment programs.

As the world moves toward greater tax competitiveness, Cyprus is keen to attract international clients seeking efficiency and flexibility. This year’s event comes at a crucial moment, as the UK’s changes to its non-dom tax regime create new openings for Cyprus to solidify its position as a leading destination for wealthy individuals and businesses.

Global Appeal for High Net-Worth Individuals

Cyprus’ tax benefits, wealth protection solutions, and modern legal structures were the focal points of the final panel, which also explored investment opportunities on the island. Experts such as Sara Eojourian, Head of Wealth Management at Athlos Capital, discussed the array of investment solutions that Cyprus offers, particularly for HNWIs. These services not only provide personalized wealth management but also come at competitive costs, making them an attractive option for international investors.

Conclusion: Cyprus, an Attractive Option for International Clients

In conclusion, Cyprus is increasingly recognized as a top destination for both high-net-worth individuals and international businesses. Thanks to its competitive tax system, business-friendly legal environment, and strategic location, Cyprus is solidifying its status as a prime hub for foreign investment. As global tax policies continue to evolve, Cyprus remains well-positioned to provide attractive opportunities for clients and businesses seeking stability, efficiency, and significant fiscal benefits.