Cyprus Business Now: financial literacy, unemployment, tourism, tax agreement

Business & economy wrap-up from the day beforeMax Fedorov, founder of the learning platform CoinTales.AI, is advocating for earlier financial education in Cyprus. Speaking to the Cyprus Mail, Fedorov argued that children should be taught fundamental economic concepts far sooner than the current curriculum allows. Fedorov, a software developer, noted that formal economics lessons often do not begin until the 7th or 8th grade. He believes this is too late, as younger children are highly receptive to learning. His platform utilises AI to create gamified, interactive content, making complex topics accessible and engaging for youngsters. By fostering a foundational understanding of finance, he aims to equip the next generation with the practical skills required for economic resilience. Cyprus and Sweden on Friday signed a protocol updating their bilateral double taxation agreement, bringing the treaty into line with OECD international tax standards and strengthening cooperation on tax transparency and the exchange of information. The protocol was signed on behalf of the Republic of Cyprus by Finance Minister Makis Keravnos, while Swedish Ambassador Martin Hagstrom signed on behalf of Sweden, according to a statement issued by the finance ministry. The ministry said the protocol amends the original 1988 Convention for the Avoidance of Double Taxation with respect to taxes on income. It explained that the revised agreement incorporates the minimum standards of the OECD’s Base Erosion and Profit Shifting (BEPS) initiative, introduces provisions relating to bilateral tax treaties and includes mutually agreed wording governing the exchange of tax information. Cyprus recorded a wider current account deficit in the first quarter of 2026, even as the European Union posted a stronger external balance, according to figures released by Eurostat on Friday. Eurostat said Cyprus registered a current account deficit of €1.3 billion in the first quarter of 2026, compared with a deficit of €0.8 billion in the fourth quarter of 2025 and €1.0 billion in the corresponding quarter of 2025. The latest figures also showed that Cyprus’ current account had narrowed to a deficit of €0.1 billion in the third quarter of 2025 after standing at €0.4 billion in the second quarter of the same year, before widening again over the following two quarters. Across the EU, the seasonally adjusted current account surplus increased to €113.4 billion in the first quarter of 2026, equivalent to 2.4 per cent of gross domestic product, up from a surplus of €99.2 billion, or 2.1 per cent of GDP, in the fourth quarter of 2025. The Cyprus Stock Exchange (CSE) Council on Friday released its official report detailing the market shares of its members for June 2026, as well as the cumulative figures for the first half of the year. This comprehensive data release provides transparency regarding trading activity, categorising performance both with and without the inclusion of pre-agreed transactions. The figures for the period spanning January 1, 2026, to June 30, 2026, highlight the relative standing of various investment firms operating within the market. For the first half of the year, CISCO Ltd secured the leading position, achieving a market share of 28.71 per cent when including pre-agreed transactions, and 33.41 per cent when these are excluded. Mega Equity Fin. Serv. Ltd followed in the rankings, recording 21.11 per cent market share with packages and 24.19 per cent without. Serious weaknesses in Cyprus’ system for licensing and supervising tourist accommodation are undermining efforts to upgrade the country’s tourism product, according to a new special report by the Audit Office, which found that only 23 per cent of hotels and tourist accommodation hold a full operating licence. The report, prepared under Auditor General Andreas Papaconstantinou, paints what it describes as a worrying picture of the sector, citing shortcomings in licensing procedures, supervision, inspection mechanisms and the management of subsidy schemes operated by the Deputy Ministry of Tourism. Papaconstantinou warned that “the effort to upgrade the Cypriot tourism product is being called into question,” pointing to the low proportion of businesses operating with full licences. The report found that 55 per cent of tourist accommodation operates without a full operating licence, while a further 22 per cent operates under temporary licences. The situation is particularly severe in the Famagusta district, where only 24 of the 241 tourist accommodation establishments, or 9.9 per cent, hold a full operating licence. Cyprus’ tourism sector is receiving growing attention in the Israeli media, with a number of leading news outlets reporting a partial recovery in visitor numbers following disruption caused by the conflict between Israel and Iran. Recent coverage has linked the earlier slowdown in tourism to the regional conflict while portraying Cyprus as a nearby, affordable, safe and welcoming destination for Israeli travellers. Israeli news website Walla reported that Cyprus’ tourism market is gradually recovering, with Israeli visitors playing a significant role in the rebound. According to the publication, Cyprus’ geographical proximity, frequent flight connections and Israelis’ familiarity with the island continue to make it a preferred destination, particularly for short breaks. The report also said that, despite a period of uncertainty, demand from Israeli travellers recovered quickly after flights resumed. Business news website Calcalist reported that approximately 590,000 Israelis travelled to Cyprus in 2025, representing an increase of 39 per cent compared with 2024. Freedom24 has won two honours at the 2026 FinTech Awards, receiving recognition for its pan-European retail investment platform and its artificial intelligence-powered compliance technology, the company announced this week. The European subsidiary of Freedom Holding Corp. received the Best Pan-European Retail Investment Platform 2026 award for its proprietary Tradernet platform and its presence across the European Union, as well as the AI in Finance Innovation Award 2026 for its Neo Compliance framework. The awards, presented by Wealth & Finance International, recognise companies driving innovation in financial technology, with winners selected based on expertise, performance and measurable impact within their respective markets. The Central Bank of Cyprus (CBC) continued to improve the sustainability profile of its non-monetary policy portfolios throughout 2025, according to its latest annual climate-related financial disclosures released this week. The report confirms that the bank has further reduced climate-related transition risks, with climate considerations now fully integrated into its investment processes, risk monitoring, and reporting practices. The bank’s total currency reserves stood at €1.77 billion at the end of May 12, 2025, which represents an increase of €153 million compared to the previous year. As part of its broader mandate, the bank aims to steer these portfolios towards a path of decarbonisation aligned with the 2015 Paris Agreement goals and the European Union’s climate neutrality objectives. To enhance transparency, this year’s disclosure includes scope 3 relative metrics for non-sovereign issuers for the first time, reported separately from scope 1 and scope 2 emissions due to ongoing data quality challenges. Cyprus has retained its place on the Paris MoU White List, with the Cyprus Union of Shipowners (CUS) saying the result confirms the continued quality and reliability of the Cyprus flag. The latest 2025 Paris MoU performance list, valid from July 1, 2026 until July 6, 2027, places Cyprus 22nd among 40 flag states on the White List, following 2,155 inspections and 65 detentions recorded during the 2023–2025 period. CUS congratulated the Shipping Deputy Ministry, the Cyprus Maritime Administration and the wider Cyprus shipping community, saying the result “reaffirms the exceptional quality and performance of the Cyprus flag” and emphasises the country’s commitment to maritime safety, environmental protection and regulatory compliance. The Paris MoU said its White, Grey and Black List is based on the total number of inspections and detentions over a three-year rolling period for flags with at least 30 inspections, with the 2025 results approved by the Paris MoU Committee at its 59th meeting. Demetra Holdings Plc on Friday announced the net asset value of its shares as of June 30, 2026, in a formal notification to the Cyprus Stock Exchange (CSE). The company stated that the net asset value per share stood at €2.5929 on this date. Regarding the fully diluted net asset value, the firm stated that it was not applicable. The Mall of Cyprus Plc on Friday announced that its board of directors has approved an interim dividend of €6,000,000 for the 2026 financial year. This payout will be distributed to shareholders who are listed in the register of members maintained by the company and the Central Securities Depository and Central Registry of the Cyprus Stock Exchange (CSE) on May 12, 2025. According to a regulatory filing, the board of directors reached this resolution after carefully assessing the financial status of the company. Each fully paid-up ordinary share will be eligible for a dividend payment of €0.018. Cyprus has made progress in licensing hotels and tourist accommodation, but more than half of tourist units have still never submitted an application, the Deputy Ministry of Tourism said this week. Responding to the Audit office’s report, the Deputy Ministry said it intends to comply with its observations, while stressing that the issue has been unresolved for almost three decades. The problem, it said, worsened between 2014 and 2018, following large-scale renovations and expansions by hotel units after the urban planning incentives announced in 2013. According to the Deputy Ministry, during the five-year transitional period provided for under the 2019 legislation, only 43 operating licences were issued. This meant that by April 2023, just 6 per cent of hotels had been licensed. The Cabinet has approved a bill requiring more balanced representation of women and men in the senior decision-making bodies of listed companies, marking another step in Cyprus’ efforts to align corporate governance with EU equality rules. Gender Equality Commissioner Josie Christodoulou said the bill, entitled “The Gender Balance in Managerial Positions of Listed Companies and Related Measures Law of 2026”, provides that members of the underrepresented sex must hold at least 33 per cent of all management positions in listed companies. Writing on her personal platform, Christodoulou described the approval as “another essential step towards equality between women and men”, saying the bill promotes balanced representation on boards through merit-based and transparent selection procedures. The proposed legislation brings Cyprus into line with Directive 2022/2381, the EU’s corporate board gender balance framework. Under the directive, large listed companies in the EU must meet one of two targets, 40 per cent representation of the underrepresented sex among non-executive directors, or 33 per cent among all directors, by June 30, 2026. President Nikos Christodoulides on Thursday said the construction sector was central to Cyprus’ shift towards a more sustainable development model, while stressing its role in housing, jobs and regional growth. Speaking at a dinner hosted by the Cyprus association of building contractors (Oseok) in Nicosia, Christodoulides said that “the transition to a greener and more sustainable model was a common goal of the state, the government and the private sector.” He said the sector’s importance went beyond its contribution to economic activity, as it supports employment, a wide range of related professions and businesses, regional development and “the environment in which citizens live and create”. Cyprus, he added, is going through a period of “substantial transformation”, with the demands of the modern economy, technological developments and sustainable development requiring a more flexible and effective state. This, he said, was necessary to support entrepreneurship, attract investment and promote growth, which in turn allows the state to pursue targeted social policy, adding that “the government is promoting a broad reform programme aimed at modernising procedures, reducing administrative burdens and using technology for the benefit of citizens and the economy.” Cypriot businesses are making steady progress in adopting Environmental, Social and Governance (ESG) practices, two years after the launch of the Interbank ESG project, with more than 1,200 companies having completed their assessment through the Synesgy platform. According to an announcement by Artemis Credit Bureau, which manages the project in cooperation with ICAP CRIF, a member of the international CRIF S.p.A. Group, a total of 2,319 businesses have so far been invited to participate in the platform. Of these, 1,213 businesses have completed the process assessing their level of sustainability. Artemis said the participation rate is considered particularly positive, given that the Cypriot market is still at a developing stage in terms of sustainability practices. Cyprus’ registered unemployed rose in June, with the increase driven mainly by accommodation and food services, public administration, education, and health and social work, figures released by the Statistical Service (Cystat) showed on Friday. The number of unemployed persons registered at district labour offices reached 10,056 on the last day of June 2026, compared with 9,153 in the same month last year. This marked an annual increase of 903 persons, or 9.9 per cent, according to Cystat. Compared with May, the actual number of registered unemployed also rose sharply, from 7,936 to 10,056. However, this partly reflects the seasonal nature of unemployment in Cyprus, particularly in sectors such as education and public administration. On a seasonally adjusted basis, which better reflects the underlying trend, registered unemployment increased more modestly to 10,656 persons in June, from 10,543 in May. Cyprus’ Industrial Turnover Index rose by 4.6 per cent in April 2026, reaching 143.1 units, according to figures released on Friday by the statistical service (Cystat). For the first four months of the year, the index recorded a cumulative increase of 3.4 per cent compared with the corresponding period of 2025. The figures are calculated using 2021 as the base year, meaning the index measures monthly turnover changes in relation to the average monthly turnover recorded during that year. Manufacturing remained the main contributor to industrial turnover, with its index reaching 149.2 units in April, reflecting an annual increase of 5.1 per cent. Central Bank of Cyprus (CBC) governor Christodoulos Patsalides this week participated in the European Central Bank (ECB) Forum on Central Banking in Sintra, Portugal, an annual gathering focused on monetary policy, financial stability, innovation and Europe’s economic future. The CBC said the forum, held under the theme ‘Shaping Europe’s future: innovation, growth and stability’, brought together central bank governors, policymakers, academics, economists and journalists from across Europe and beyond to exchange views on the principal challenges and opportunities facing the European economy. The central bank described the event as the ECB’s flagship annual forum, providing a platform for dialogue on monetary policy, financial stability, innovation and the future of economic growth in an increasingly complex global environment. In her opening address, European Central Bank President Christine Lagarde said the ECB had effectively gone “back to basics” after years of relying on extraordinary monetary policy measures in response to successive crises. “We can now focus on stabilising inflation with policy rates as our primary tool,” Lagarde said. Maritime company Safe Bulkers has approved a new quarterly dividend for holders of its Series C and Series D preferred shares, while also moving ahead with its fleet renewal and Environmental, Social, and Governance (ESG) plans. The board of directors of the New York-listed dry-bulk shipping company declared a cash dividend of $0.50 per share on its 8 per cent Series C Cumulative Redeemable Perpetual Preferred Shares and 8 per cent Series D Cumulative Redeemable Perpetual Preferred Shares. The dividend covers the period from April 30 to July 29, 2026, the company said. Payment will be made on July 30, 2026, to shareholders of record as of July 17, 2026.