Cyprus Implements EU Rules to Screen Foreign Direct Investments, Enhances Business and Innovation

Strategic Insights -

Cyprus' parliament began debating a bill to screen foreign direct investments in strategic sectors, in line with EU rules designed to safeguard security and public order. The legislation aims to give the state the power to approve, impose conditions, block, or even reverse foreign investments deemed to pose risks. This move aligns with the country's broader strategy under Vision 2035 to foster cross-border partnerships, attract international investment, and accelerate the global competitiveness of its research and innovation ecosystem.

Key Takeaways:

  • The Cyprus parliament is debating a bill to screen foreign direct investments in strategic sectors, in line with EU rules to safeguard security and public order.
  • The legislation gives the state the power to approve, impose conditions, block, or even reverse foreign investments deemed to pose risks.
  • The bill aims to align with EU Regulation (EU) 2019/452, which establishes a framework for monitoring foreign direct investments into the European Union on grounds of national security or public order.
  • Cyprus' Vision 2035 strategy aims to foster cross-border partnerships, attract international investment, and accelerate the global competitiveness of its research and innovation ecosystem.
  • Recent business visits, such as the high-level visit to the United Arab Emirates, reinforce Cyprus' role as a forward-looking hub for artificial intelligence, deep technology, and innovation-led economic growth.
  • The 13th Invest Cyprus International Investment Awards highlighted the growing confidence in Cyprus as an investment destination, citing President Nikos Christodoulides' visit to the United States and the official visit of Indian Prime Minister Narendra Modi to the island.
  • Deputy Shipping Minister Marina Hadjimanolis paid a working visit to London to strengthen bilateral ties with the United Kingdom and promote Cyprus' bid for re-election to the council of the International Maritime Organisation (IMO) for 2026-2027.
  • The Cyprus Financial Literacy and Education Committee (CyFLEC) reviewed the progress of Cyprus' national strategy for financial literacy, focusing on assessing the work carried out by CyFLEC's Thematic Working Groups (TWGs) during the first half of 2025.
  • Artificial intelligence (AI) is transforming financial markets in Cyprus, bringing speed and innovation to the sector, but requires strong regulations, ethical safeguards, and human oversight to ensure technology serves the public good.
  • The National Bank of Greece launched its 16th Innovation and Technology Competition as part of its NBG Business Seeds programme, with over 8,700 submissions to date, promoting entrepreneurial creativity and technological innovation.
  • Cytacom Solutions Ltd, a subsidiary of Cyta, signed the renewal of its collective labour agreements for the 2025-2027 period, covering both monthly and hourly-paid staff, and confirming the strong cooperation and mutual trust between management and trade unions.
  • The board of directors of Mall of Cyprus approved an interim dividend of Pound 13.5 million, following a review of the company's financial position based on the provisional 2025 accounts.
  • Cyprus recorded a trade deficit of Pound 3.26 billion in the first five months of 2025, slightly up from Pound 3.18 billion in the same period of 2024, with total imports of goods reaching Pound 5.37 billion and total exports of goods reaching Pound 2.12 billion.

Statistics:

  • Cyprus' trade deficit reached Pound 3.26 billion in the first five months of 2025, up from Pound 3.18 billion in the same period of 2024.
  • Total imports of goods from January to May 2025 amounted to Pound 5.37 billion, rising by 13.7% from Pound 4.73 billion in the corresponding period of 2024.
  • Total exports of goods reached Pound 2.12 billion in the first five months of 2025, marking a 36.9% increase from Pound 1.55 billion in January to May 2024.
  • The construction production index in Cyprus reached 112.65 units in the first quarter of 2025, reflecting a 1% increase compared to the same period in 2024.
  • The output construction prices index reached 123.70 units in the first quarter of 2025, based on 2021 as the reference year.

Sources:

  • "Parliament on Thursday began debating legislation to screen foreign direct investments in strategic sectors, aligning Cyprus with EU rules designed to safeguard security and public order."
  • Cyprus Business Today: "Chief Scientist Demetris Skourides completes high-level business visit to UAE"
  • Invest Cyprus: "Chairman Evgenios Evgeniou addresses foreign investors at 13th Invest Cyprus International Investment Awards"
  • Press Release: "Deputy Shipping Minister Marina Hadjimanolis pays working visit to London"
  • Central Bank of Cyprus: "CyFLEC reviews progress of national strategy for financial literacy"
  • Cyprus Stock Exchange: "Senior Officer Eliza Stasopoulou highlights importance of regulations and oversight in AI"
  • Safe Bulkers: "Announces 5th annual scholarship programme for academic year 2025-2026"
  • National Bank of Greece: "Launches 16th Innovation and Technology Competition"
  • Cytacom Solutions Ltd: "Announces renewal of collective labour agreements"
  • Mall of Cyprus: "Approves interim dividend of Pound 13.5 million"
  • Statistical Service of Cyprus: "Trade deficit reaches Pound 3.26 billion in first five months of 2025"