“Chinese investors are fast catching up with Russians when it comes to Cypriot passports,” a finance ministry source told the press.
The citizenship by naturalisation scheme was originally open to those investing €5 million in certain investments.
The amount has recently been cut to €2.5m but for a narrower range of investments, with the aim of supporting the real economy. Bank deposits no longer qualify, for example, and there is a cap on government bond investments.
Whereas Russians already have well established communities and a business presence on the island, new Chinese investors keep a much-lower profile. Visitors from China were limited to just 27 people in August according to the Statistical service.
“Most of the Chinese businessmen are already well-established in a world metropolis like London, so some of them do not even intend to make a serious use of their property even as a holiday resort,” an experienced real estate agent told the press.
Casino on the spot
That does not mean Chinese investors are not contributing to the economy, however. Business people from the world’s second-largest economy have been investing in hotels, for example.
A Chinese consortium plans a five-star hotel in the Sotira area of Famagusta, while Macau-based Melco is a strong contender for the Republic of Cyprus’ first casino resort.
“Melco is looking forward to continue exploring the emerging gaming jurisdiction and collaborating with the Cyprus Government for what it considers to be in the best interest of Cyprus,” according to one source.
Ho, Group Chairman and CEO of Melco, told the company’s shareholders in a statement.
The Melco-Hard Rock consortium is competing against NagaCorp, a company with Malaysian interests based in Cambodia that also depends to a great extent on Chinese tourists.
“The Group believes that its strategy to diversify its business geographically and expand into new casino markets will drive revenue growth in the long term,” NagaCorp stated in its 2016 interim report few days ago.
Philippine-based Bloomberry officially announced earlier this week that it has withdrawn from the Cyprus casino race, thereby confirming earlier press reports.
Chinese interest in investment abroad had been fuelled by the surprise currency devaluation a year ago in an attempt by the central bank to boost the country’s exports.
“Cash is still leaking out of China, and low interest rates in the US and EU have forced Chinese businessmen to explore less-traditional options like Cyprus,” a person within the consultancy industry told the press.
Chinese companies have announced deals on overseas assets worth $157.2 billion so far this year, according to Bloomberg.