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CHAK Privatization Advances Under Revised Cyprus Investment Rules

by THEFUTURE.TEAM

February 23, 2026

Overview Of New Legislation

The Cyprus Parliament unanimously approved legislation that opens the way for the privatization of CHAK. Under the new framework, investor selection will no longer rely solely on the highest financial offer. Evaluation criteria now include qualitative factors, such as the investor’s business plan and its potential contribution to developing the stock market.

Emphasizing Strategic Investment Over Price

Christiana Erotokritou, President of the Parliamentary Economic Committee and member of DIKO, said the reform is important for both Cyprus’ economy and the future of CHAK. She noted that the exchange has not reached its full potential and stressed that the goal is to attract a strategic investor from a regulated market rather than simply sell a state asset. She also welcomed the Ministry of Finance’s decision to incorporate proposals submitted by DIKO during the legislative process.

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Ensuring Sustainable Market Growth

Haris Georgiadis, a DISY parliamentarian, added that the inclusion of qualitative parameters in the evaluation process is designed to secure the sustainable and positive growth of CHAK. This strategic outlook reflects a broader commitment to strengthening the competitiveness and credibility of Cyprus’ financial sector.

Institutional Reforms And Employee Protections

According to the Ministry of Finance, the legislation forms part of a broader capital market modernization plan. The law provides a framework for the gradual transfer of responsibilities related to the Central Securities Depository and the Central Register of Securities to a strategic investor, while maintaining operational continuity and safeguarding public interest.

Protection Of Employee Rights

Another critical aspect of the legislation is its provision for defending the labor rights of CHAK’s workforce. The bill ensures a smooth transfer of employees to the Ministry of Finance, or alternatively, facilitates compensation based on a defined early voluntary retirement plan, which further underscores the commitment to social responsibility during this transition.

Looking Ahead

The Ministry of Finance has expressed its gratitude towards Parliament members and, in particular, the Parliamentary Committee on Economic and Budgetary Affairs, for their collaboration in finalizing this important reform. The commitment to effectively implement the law underscores the government’s dedication to fostering an environment that supports long-term economic growth and stability in Cyprus.

The Future Forbes Realty Global Properties

Cyprus Among Lowest Corporate Investment Performers In The EU

Overview Of Eurostat Findings

Eurostat data show that Cyprus recorded a business investment rate of 16% in 2024, placing it among the lowest levels in the European Union alongside Ireland. The figure is lower than rates observed in several other EU economies.

Defining The Investment Metric

The business investment rate measures the share of operating profits that companies reinvest as capital expenditure. These investments include spending on machinery, technology, and buildings, which contribute to production capacity and long-term business activity.

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EU Trends And Economic Implications

Across the EU, the investment rate for non-financial corporations stood at 21.8% in the fourth quarter of 2025, the lowest level since the third quarter of 2015. Earlier data show that the rate increased from around 22% in 2014 to nearly 24% in 2018, before declining from 2021 onward.

National Disparities In Corporate Investment

Investment rates vary across member states. Hungary recorded 28.4%, followed by Croatia at 28.3% and the Czech Republic at 27.6%. Other countries, including Belgium at around 27% and Sweden at 26.9%, also reported higher levels. At the lower end, Luxembourg recorded 15.9%, the Netherlands 16.7%, and Malta 16.8%, alongside Cyprus and Ireland at 16%.

Conclusion

The data underscores significant disparities in reinvestment strategies across the European Union. For economies like Cyprus, the challenges are compounded by structural limitations and a narrower focus on service-oriented industries. To spur economic growth and safeguard future competitiveness, targeted policy interventions will be necessary to elevate business investment levels amid shifting global market conditions.