Cyprus should further exploit its comparative advantages rendering the investment funds sector as a bridge for attracting investments in Europe from Middle East and Asia, Finance Minister Constantinos Petrides has said, addressing the Cyprus Investment Funds Association (CIFA) Annual General Meeting on Thursday.
“This sector is particularly significant considering that we are entering a new economic era which is changing the characteristic we’ve know until today,” Petrides said.
Recalling the Association’s medium-term target to boost assets under management from approximately €12 billion in end-2021 to €25 billion, Petrides assured that the government will stand by the sector which began in 2013.
“We will modernise it so that we can enter the new era,” he added, noting that the new era is associated with the shift from the reliance on cheap energy to the green transition which is a challenge.
“The green transition requires billions in financing and multiple investments from the private sector,” the Finance Minister added.
Petrides also referred to the need to attract investments complying with ESG requirements, recalling the government’s bid to introduce a green sovereign bond by the end of the year.
The Finance Minister praised the sector’s contribution to the Cypriot economy, noting that asset under management now are close to €12 billion compared with just €1 billion ten years ago.
He also highlighted that of the total assets under management, €2.5 billion are invested in the Cypriot economy, creating jobs and boosting income.
Moreover, Petrides highlighted that the Cypriot GDP marked a much less severe contraction during the 2020 COVID-19 pandemic, compared with the projections by economists both at home and abroad, who believed that Cyprus follows an undiversified model.
He also praised the collaboration between the public and the private sector and the cooperation between the Cyprus Securities and Exchange Commission and private investors.
On his part, CIFA President Andreas Yiasemides, said the association’s aim “is to render Cyprus one of the top hubs for investment funds both in Europe and internationally.”
He also noted that the sector has proved particularly resilient during the pandemic as not only did it not shrink but it continued to grow.
Yiasemides said in 2021 licensed entities marked an increase of 47.6%, adding that he is convinced that the sector growth will continue in a higher pace.
Cysec’s Vice President George Karatzias on his part said that the sector’s growth is associated with the introduction of a comprehensive legal framework in Cyprus during the last nine years, adding that alternative investments organisations (UCITS) in end 2021 invested around €309 million in energy, €110 in shipping, €47 million in sustainable investments, €30 in fintech, while investments in Crypto amounted to €9.4 million.