Still trying to fend off a reputation as being a money haven for the rich who want to hide their assets, Cyprus now is a key destination for investment funds for Asia who want to get on the doorstep of the European Union.

The island has a key location at the nexus of Asia, Eastern Europe, Turkey, Russia, the Middle East, North Africa and Greece and has offered Golden Visa citizenships to wealthy buyers of property and real estate and the Asian funds want to use the country’s EU passport for investments there and in other countries in the bloc, the financial news agency Bloomberg said in a report.

“There is an increasing trend for funds from countries who traditionally didn’t have strong economic ties with Cyprus such as China, India and even Japan, to establish a base in the country as their gateway to the EU,” Andreas Yiasemides, Vice President of the Cyprus Investment Funds Association, said in an interview in Nicosia.

The number of investment funds and assets under management have hit record highs, according to the Central Bank of Cyprus. At the end of March the number of funds rose to 123 from 110 at end December.
Total assets under management rose by about 29 percent to 4.45 billion euros ($5.24 billion) from 3.45 billion euros. In Dec., 2008 there were 55 funds with 1.23 billion euros in assets under management.

There’s also strong interest in being on the stock market there for alternative investment funds, said Cyprus Securities and Exchange Commission Chairwoman Demetra Kalogerou. “There are 60 applications at this moment for different fund structures,” she said. “Of these, 44 have been pre-approved, subject to fulfilling certain conditions.”

Having recovered from a 2013 economic crisis when bad investments in Greek businesses and heavy holdings in devalued Greek bonds almost brought down the banks – coming back largely because of a 47.5 percent confiscation of bank accounts of more than 100,000 euros ($117,900) authorized by President Nicos Anastasiades to get a 10-billion euro ($11.79 billion) international bailout, Cyprus also is planning more changes to get investors andasset managers to register and manage funds, Marios Tannousis, Board Member and Secretary of CIFA told the news agency.

That includes easier-to-understand tax tables for investment funds, a fast-track procedure for launching so-called registered alternate investment funds and the establishment of a new category of investment managers known as mini-managers who will be licensed to operate below current alternative investment fund manager thresholds, he said.

Cypriot legislation for establishing funds is much more flexible than elsewhere in Europe, but investors remain well protected, Yiasemides said. Costs in Cyprus are much lower than elsewhere in the EU and that is very important for small and medium-sized fund managers that Cyprus is seeking to lure.

“We can’t become Luxembourg from day one and so we aim to attract funds that take cost into account,” he said, referring to another EU country which has a reputation for helping big companies evade taxes.