Cyprus will try to improve tarnished image in West

Subject

Nicosia’s decision to revoke the citizenship of 26 foreign nationals.

Significance

Cyprus has tightened up its Citizenship by Investment Programme (CIP) with regard to certain controversial individuals out of a desire to strengthen relations with the United States and EU. This is particularly important given Turkish efforts to prevent Cyprus exploring for natural gas in its waters.

Impacts

• According to a finance ministry study, CIP made a positive but relatively small contribution to GDP during 2013-18.
• The construction sector benefited in particular, with employment rising by about 8%.
• The effect on property prices seems largely to have been confined to Limassol.
• The impact on Cypriot banking amounted largely to stabilising the sector and providing a new source of finance during the banking crisis.