Investment in Cyprus

Republic of Cyprus

Main article: Republic of Cyprus

2024: 7th largest direct investment in Kazakhstan - $777.3 million

In April 2025, the report of the UN Economic and Social Commission for Asia and the Pacific (ESCAP) was published, from which the volume of direct investment in Kazakhstan by the end of 2024 became known. Read more here.

2023: Reduced foreign investment

Data for 2023

2020: Investments from Russia to Cyprus for the first time in history turned negative - minus $1.5 billion

Direct investments from Russia to Cyprus in 2020 for the first time in history turned out to be negative - minus $1.5 billion. This means that Russian residents got rid of Cypriot property.

Vedomosti writes about this with reference to the statistics of the Central Bank of the Russian Federation. The regulator calculates the size of direct investments as the difference between the purchase (contribution) and the sale of financial assets - shares in the authorized capital, bonds, etc. Capital flows in the form of dividends and interest on loans are not reflected in the indicator. The representative of the Central Bank explained to the publication that the Bank of Russia only collects statistics and does not assess and analyze direct investments.

Investments from Russia to Cyprus for the first time in history turned out to be negative

For five years until 2020, direct investments from Russia to Cyprus were measured at $9-20 billion per year. In 2019, for example, they amounted to $14.4 billion.

Direct investments are made for further reverse investment in Russian companies. A Cyprus-based firm uses its share capital to acquire a stake in a Russian entity that subsequently reverses the funds through dividends or interest. The latter are considered to be part of the outflow of capital. In 2019, according to the Ministry of Finance, more than 1.9 trillion rubles were withdrawn to Cyprus.

This approach has long been possible thanks to the terms of the Bilateral Double Tax Avoidance Agreement (SIDN). It provided for a reduction in the income tax rate on dividends at source to five percent (instead of the standard 15), provided that the recipient is a resident of one of the contracting parties. Interest on loans was not at all taxed at the source. Since this year, the terms of the agreement have been revised at the request of Russian President Vladimir Putin - the withholding tax rates on dividends and interest have been increased to 15%.^[1]

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