Cyprus has formally approved the creation of a national mechanism for the control of foreign direct investments (FDI), following a cabinet decision on Wednesday.

The move aims to strengthen the country’s protective framework, align with European Union standards on national security and transparency, and safeguard strategic infrastructure.

President Nikos Christodoulides had earlier described the initiative as a key institutional reform that would contribute to the strategic upgrade of Cyprus’ credibility and international reputation.

Following the cabinet meeting, Finance Minister Makis Keravnos confirmed the decision, stating that “this is a very important development directly linked to the safeguarding of national interests”.

Cyprus’ banking system liquidity fell by €4.5 billion in 2024 compared to the previous year, reaching €19.2 billion by year-end, according to data published on Wednesday by the Central Bank of Cyprus (CBC).

The figures were outlined in the CBC’s annual report titled The Implementation of Monetary Policy in Cyprus, covering developments in 2024.

According to the report, the portfolio of monetary policy bonds linked to the Asset Purchase Programme (APP) and the Pandemic Emergency Purchase Programme (PEPP) decreased by €1.1 billion during the year.

It stood at €6.5 billion at the end of 2024, down from €7.6 billion in 2023.

Banks have overtaken the government as the most influential force in Cyprus’ real estate sector, according to EY Cyprus’ latest annual survey.  

As mentioned in Philenews, the market continues to be driven by foreign investors from Israel, the UK, and parts of Europe and the Middle East, with demand linked to residence permits, personal security and quality of life.

The survey captures growing concerns within the industry, particularly over geopolitical tensions, high interest rates, and red tape.  

Cypriot insurance providers CNP Cyprialife and CNP Asfalistiki have officially been renamed ERB Cyprialife and ERB Asfalistiki, according to an official statement released on Wednesday.

The two companies said that this “marks the beginning of a dynamic new chapter in their long and successful journey”.

“This evolution reflects a natural continuation of their strong legacy, further strengthening the quality, values, and trust built with their customers over the years,” they added.

Cyprus’ hotel industry continues to face labour shortages despite a record year for tourism in 2024, with hoteliers urging targeted reforms to address staffing gaps and housing constraints.

Speaking this week at the annual general meeting of the hoteliers association (Pasyxe), president Thanos Michaelides said 49,592 people were directly employed in the sector this year, yet many hotels continue to struggle to find suitable and sufficient staff.

In response, Pasyxe is working with the Human Resource Development Authority (Anad) on a programme to reintegrate people aged 55 to 65 into the hotel workforce.

Unemployment in Cyprus stood at 3.6 per cent in May 2025, down from 3.7 per cent in April and 4.8 per cent in May 2024, according to data released by Eurostat on Wednesday.

The number of unemployed remained unchanged compared to April, while in May last year it was significantly higher. By gender, the unemployment rate in Cyprus was 4.4 per cent for women and 3 per cent for men. 

The seasonally adjusted unemployment rate in Cyprus is lower than the corresponding rates in both the euro area and the EU and ranks as the fifth lowest in the bloc. 

The Turnover Value Index of Retail Trade in Cyprus increased by 8.4 per cent in May 2025, compared to the corresponding month of the previous year, according to the state statistical service.

For the same month, the Turnover Volume Index of Retail Trade saw a rise of 10.0 per cent when compared to May 2024.

Looking at specific economic activities within the Turnover Value Index for May 2025, food, beverages or tobacco in non-specialised stores (supermarkets) recorded a value index of 141.3, representing a 10.4 per cent change compared to May 2024.

The Bank of Cyprus has received two major distinctions at the 2024 EMEA Finance Achievement Awards, recognising its €300 million green bond issued in April 2024.

According to an announcement by the bank on Wednesday, the awards were for Best Green Bond in Europe and Best Financial Institution Bond in Southeastern Europe.

“The distinctions highlight the exceptional success of the issuance, which attracted interest from more than 120 institutional investors and was oversubscribed by more than four times, reaching €1.3 billion,” the bank said in its statement.

Rising prices in raw materials, fuel, energy and basic food items are only the beginning of a more difficult economic cycle that lies ahead, according to Costas Melas, president of the Cyprus Borrowers Association (Syprodat).

In a statement released this week, Melas said that “it is of critical importance for the state to act immediately and proactively, with a comprehensive plan and not with fragmented or temporary measures at the last moment”.

“The need for systematic planning and economic shielding of both the state and society has become urgent, mainly because foreclosures continue and are intensifying”, the association president added.

Bird Aviation has signed a multi-year agreement with a leading European airline for the provision of heavy maintenance services on narrow-body aircraft, reinforcing Cyprus’ position as a regional hub for aircraft maintenance and repair operations.

The company confirmed that the work will be carried out at its facilities at the old Larnaca airport, and will be scheduled to accommodate the airline’s demanding flight operations.

According to the announcement, the deal follows a successful collaboration during the 2024/25 period, during which technical inspections and related services were delivered consistently and in line with high quality standards.

The Cyprus Securities and Exchange Commission (CySEC) on Wednesday announced that it has awarded a total of €1,000 to two university students in Cyprus as part of its annual academic prize initiative.

The awards are part of a programme aimed at promoting financial literacy among young people and are granted each year in memory of CySEC’s first Chairman, the late Frixos Sorokkos, who played a key role in the formation of the regulatory body.

According to CySEC, the initiative is designed to encourage student engagement with capital markets and support academic research, while also raising awareness of the commission’s work.

The Central Bank of Cyprus this week released monetary financial institutions (MFIs) deposit and loan statistics for May 2025, revealing a marked slowdown in deposit growth and a modest rise in lending.

Total deposits in May registered a net increase of €20.8 million, significantly down from the net increase of €492.9 million recorded in April 2025.

The annual growth rate of total deposits slowed to 5.8 per cent in May, compared with 7.6 per cent in the previous month.

One in three tourists arriving in Cyprus stay overnight in the north or opt for Airbnb – licensed or not, Pasyxe chairman Thanos Michaelides told the hotel owners’ association general meeting on Tuesday.

Michaelides said this meant thousands of arrivals at Cyprus’ airports left next to nothing in the Republic in terms of money.

“As a result, we are bearing this environmental burden, without any substantive benefit,” he said.