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Cyprus aiming to be more attractive for international shipping investment

Cyprus aiming to be more attractive for international shipping investment
The role of the shipping industry in reaching a settlement of the Cyprus problem will boost the prospects of the island nation’s shipping sector, the country’s President Nicos Anastasiades told the Cyprus Union of Shipowners in Athens on 10 October.

“The contribution of Cyprus’ shipping to achieving this target was invaluable, which confirms it is a priceless capital for Cyprus and one of the most important pillars of economic growth accounting for 7% of gross domestic product,” he told the union which represents ships under the Cyprus flag. Cyprus’ economy will grow 2.9% this year after expanding 1.6% in 2015, compared to a previous forecast of 2.7%, he said.

Anastasiades was making a flying visit to Athens to attend an event along with Greek president Prokopis Pavlopoulos for the Greek missing persons from the Turkish invasion in 1974. He was accompanied by the Transport Minister, Marios Demetriades and government spokesman, Nicos Christodoulides and later in the day flew to Cairo for the fourth tripartite meeting of leaders of Cyprus, Egypt and Greece in Cairo, which is expected to further deepen trade cooperation between the three countries.

Speaking at a luncheon hosted by the shipowners, Anastasiades said that in order for Cyprus to become more attractive for investment in shipping, it gave non-Cypriot companies, which are effectively controlled from Cyprus, the opportunity to opt for tonnage tax without having to register at the company registrar.

In addition, Cyprus is currently considering whether to go ahead with a legislative amendment to “exempt companies benefiting from the tonnage tax system from the obligation to submit financial statements,” he said. “It is a measure pushed forward and will have immediate results”.

Anastasiades said that “only recently,” the tax department issued a circular clarifying that interest revenue of shipping companies benefiting from the tonnage tax system is exempted from the special defence contribution levy.

In addition, Cyprus introduced the “non-domicile” special status in order to attract foreign high-income earners, the president said. “The main incentive these persons get is their exemption from the defence levy on interest, dividend and rent (income),” he continued.

He told the owners, the government has prepared a draft bill to create a shipping portfolio assigned to a deputy minister, “who will be responsible as an independent authority to handle all issues related to shipping,” Anastasiades said. “The aim is flexibility in decision making, improving services provided by the government, promoting Cyprus’s flag and strengthening cooperation with other private sector stakeholders in an attempt to strengthen Cypriot shipping and establishing (Cyprus) as a modern global shipping services centre”.

As part of the authorities’ effort to improve services to the shipping sector, Cyprus inaugurated in March a shipping bureau in Piraeus, to strengthen the capacity of the London bureau, and will set up another representation in the Far East, he said.

A solution of the Cyprus problem will help normalise bilateral relations between Greece and Turkey, the European Union and Turkey and Nato, he said.

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