What key areas of opportunity or growth do you see in your sector, and what are your expectations for Cyprus in 2020?
It is always difficult to accurately predict the future but I can identify several areas of potential growth for the legal profession in the year ahead. One of these is the managed funds sector. The continuation of negative interest rates is problematic for depositors who wish to protect and grow their wealth. This may lead them to consider alternative investment schemes where it is still possible to earn a return on their investment whilst enjoying the ‘safety-net’ of EU regulation. Additionally, Cyprus, as a low-cost and geographically well-placed venue, stands to benefit from funds seeking to relocate to the EU following the introduction of EU economic substance requirements. The fact that Cyprus banks have become extremely ‘risk averse’ to lending means that many larger projects will need to look towards managed funds and other alternative sources for finance. Innovative investment structures require high quality legal support and advice.
Another area I see as offering growth potential both for the legal sector and, for Cyprus as a whole, is the shipping industry. In December 2019, the EU Commission approved the prolongation of Cyprus’ unique tonnage tax scheme for a further 10 years. This removed a significant question mark from the sector and, echoing the sentiments of the Deputy Minister, I now expect the number of ships registered under the Cyprus Flag and the number of companies registered under the Cyprus tonnage tax scheme to continue with a pattern of steady growth. The legal profession should benefit from this.
The possibilities presented in the fields of technology and innovation should also never be ignored. Within the legal profession the technological revolution and the growth of AI, properly harnessed, can be used to enhance our existing client service and, to create new service offerings. These days, of course, all development must have at its core the concept of sustainability. The opportunities for the legal profession, business, and society as a whole offered by the EU ‘Green Deal’ strategy, and by the financial structure being assembled to support it, are numerous. Moving to a carbon neutral position will not only be good for the health of our environment and our citizens but, the innovation and investment that it will require has the potential to result in financial gain too.
Finally, the ‘elephant in the room’ that is Brexit cannot be ignored. The fact that the UK has indeed finally ‘exited’ the EU and, the belligerent tone adopted by the British government in its negotiations with the EU will be of concern to the many UK businesses which rely on the European market and to the UK ‘finance sector’ as a whole. This creates opportunities for the legal profession on many levels ranging from exporting and regulatory advice through to business relocations to name just a few.
It is never good to be complacent but I do see significant grounds for optimism in the year ahead both for the legal profession and for Cyprus in general.