The Central Bank of Cyprus (CBC) released its comprehensive 2024 Foreign Direct Investment (FDI) report on Thursday, painting a picture of a resilient and maturing financial landscape. While the headline figures show a “negative” balance, the underlying data reveals a significant improvement in transaction stability and a notable boost in investor profitability.
According to data compiled by the CBC and reported by Stockwatch.com.cy, Cyprus continues to operate as a primary gateway for cross-border capital, with inward investments consistently outpacing outward flows.
2024 FDI Performance: At a Glance
The following table summarizes the shift in Cyprus’s investment position over the last year:
| Metric | 2023 Performance | 2024 Performance | Trend |
| Net FDI Stock | €-34.9 Billion | €-41.9 Billion | Expanding Hub Role |
| Net Transactions | €-10.4 Billion | €-5.1 Billion | 50% Improvement |
| Rate of Return (In/Out) | 6.7% | 7.8% | 📈 Increasing |
| Total Inward Stock | €400.9 Billion | €373.6 Billion | Slight De-leveraging |
Understanding the “Negative” Balance
In the world of international finance, a negative FDI balance for a country like Cyprus is often a sign of strength rather than weakness. It indicates that the Inward FDI Stock (foreigners investing in Cyprus) is substantially larger than the Outward FDI Stock (Cypriot entities investing abroad).
For 2024, the net stock sat at €-41.9 billion. When excluding Special Purpose Entities (SPEs)—companies that move money through Cyprus with little domestic footprint—the net position drops even further to €-50.3 billion. This confirms that Cyprus remains a high-demand destination for international capital, particularly from European and American investors.
Profitability Hits New Heights
Despite a global trend of slightly lower investment volumes (partially due to a reduction in equity instruments), the profitability of investments channeled through Cyprus strengthened. Both inward and outward rates of return climbed to 7.8% in 2024, up from 6.7% the previous year.
This near-perfect correlation in returns is largely attributed to the mirrored balance sheets of SPEs, which dominate roughly 90% of the total FDI positions on the island.
The “True” Origin: Ultimate Investing Economies
For the first time, the CBC provided an analysis of the Ultimate Investing Economy (UIE). This methodology looks past “conduit” countries to identify the actual source of the funds.
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Europe: Remains the undisputed leader, accounting for €212.9 billion of the total inward stock.
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Top Partners: Russia maintains its position as the largest partner, followed closely by the United States, Luxembourg, and the United Kingdom.
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Asia: Under this new “ultimate origin” lens, Asia’s investment footprint in Cyprus appeared significantly larger than standard statistics previously suggested.
Sector Spotlight: Services and Finance
Unsurprisingly, the tertiary (services) sector remains the backbone of Cypriot FDI. Inward stock in services reached €367.3 billion, with financial and insurance activities representing the vast majority of this activity. This specialization reinforces the island’s long-standing reputation as a sophisticated hub for international financial services.
Source: Stockwatch.com.cy