The net Foreign Direct Investment (FDI) stock of Cyprus decreased further in 2021, with Russia being the top partner, according to a report published by the CBC on Wednesday.
Net FDI stock (outward minus inward) reached - €8.3 billion, compared with -€1.9 billion, in 2020. This was due to the fact that the decrease in outward FDI was greater than that in inward FDI, according to CBC.
Moreover, outward FDI stock reached €367 billion in 2021, compared with €398 billion in 2020. The said decrease was exclusively attributed to the decrease in equity as debt instruments recorded a small increase. The 88% of outward FDI stock in 2021 comprised of equity and the 12% of debt instruments.
Inward FDI stock amounted to €375 billion in 2021, compared with €400 billion in 2020. This development was mainly due to the decrease in equity and, to a lesser extent, the decrease in debt instruments. As regards the composition of inward FDI in 2021, it comprised of 84% equity and 16% debt instruments.
CBC notes that the Cyprus FDI stock, both inward and outward, is dispersed in all continents, with Europe being the dominant partner. Outward FDI stock destined to Europe amounted to €232,632.4 million in 2021, of which €125,517.2 million go towards Russia. The second most important continent, in terms of value, was America, with an outward investment value of €72.5 billion. As regards the euro area and the European Union the share of FDI destined to those groups in 2021 amounted to 12.4% and 14%, respectively.
CBC notes that in 2021 there is an amount of €49 billion which refers to unallocated data, meaning data that cannot be allocated to a specific country.
Concerning inward FDI, this is mostly channelled from Europe and, to a much lesser extent, from America. More specifically, inward FDI stock from Europe reached €299.384,2 million in 2021, of which €120,396.6 come from Russia. Inward FDI stock from America was recorded at €38 billion. The unallocated amount in 2021 reached €21.7 billion.
The share of inward FDI stock from the euro area and the European Union is much higher than the respective share of outward FDI in 2021, as it accounted for 29.2% and 30.8%, respectively.
"Although the number of partner countries for both inward and outward FDI stock is large, there is a high concentration in a small number of countries. More specifically, the top 10 countries responsible for both inward and outward FDI stock accounted for more than 81% of the total allocated stock, with Russia being the top partner for both outward and inward FDI," CBC notes.