gold magazine issue 64 first 10 pages

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Gold

ISSUE 64 | jUly 17, 2016 | br

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ISSUE 64JUly 17, 2016PRICE €2.00

CRISIS OROPPORTUNITYFOR CYPRUS?The impact of the UK’s decision to leave the EU on key sectors of the island’s economy

INVESTMENTNatasa Pilides

on her roleas ciPa d-g

FIDUCIARY SERVICEScfa presidents

christos Michael & george Savvides

INTERVIEWSborys humeniukgeorge Mountisrichard Spencer

PLUSbusiness briefing,what’s On, books,

opinion & More

34 | GOLD | The Business Magazine of Cyprus

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CRISIS OROPPORTUNITYFOR CYPRUS?The impact of the UK’s decision to leave the EU on key sectors of the island’s economyBy John Vickers

www.goldnews.com.cy | GOLD | 31

| COVER STORY |

There can be few people in Europe who, upon learning the result of the UK ref-erendum on EU membership on the morning of June 24, were not shocked and concerned. First and foremost was the British Prime Minister himself – David Cameron had called the referen-dum early, such was his confidence in a “Remain” vote – but it has been suggest-ed that even those leading the “Leave” campaign were not actually expecting to win. If ever the saying “Be careful what you wish for” was appropriate, it was about what hap-pened on June 23, 2016.

For months, business leaders, econo-mists, foreign heads of state and oth-

er high-profile figures had been warning the British people that a vote to leave the EU would have possibly disastrous short-term consequences for the country and an uncertain, quite likely negative long-term impact on their standard of living and the UK’s economic future. 52% of voters chose to ignore them but within days, the pound had fallen to a 30-year low, share prices were plummet-ing, the Conservatives were involved in replacing David Cameron and almost all the Parliamentary Labour Party had expressed the desire for their own leader, Jeremy Corbyn, to resign. Two of the Leave campaign’s most visible advocates

also found themselves out of the picture – Boris Johnson, previously expected to replace Cameron, was deserted by Michael Gove who stood for the post himself (and lost), and Nigel Farage, whose entire political life had been based on getting the UK to leave the European Union, announced that, having achieved his aim, “I want my life back”. Not sur-prisingly, they were both castigated by European Commission President Jean-Claude Juncker, who described them as “retro-nationalists, not patriots”, adding that “A patriot would not leave the boat when the situation becomes difficult.” He also noted that the Leave campaign-ers “had no plan of where to go on from here.”

Uncertainty is the buzzword these days as it was not only those in

the Leave camp who had not planned for the day after a win for their side; the Government had not drawn up any con-tingency plans either. David Cameron has said that Britain will not invoke

Article 50, which will start the exit pro-cess, until it has a new Prime Minister, whose name will be announced on September 9 but the EU has responded by saying that no talks can begin until Article 50 is triggered. Until then, it would appear that market and currency chaos is going to be the norm, followed by two years of negotiations conducted in an atmosphere that cannot be predict-ed at this moment.

As a member of the EU, Cyprus will be affected by Britain’s exit in the

same way as its 26 partners but what, precisely, does that mean? On the follow-ing pages, you can see what two leading economists have told us, as well as the views of several others with a direct inter-est in the impact of the UK referendum

result on this country. There seems to be a consensus that, for the time being, little or nothing will change. The weak-er pound sterling may dissuade some Britons from choosing Cyprus as their summer holiday destination in 2017 and thereafter and it may make them spend less than they might otherwise have done on the island in the coming months but they have already paid for their ac-commodation and, in many cases, have booked an “all-inclusive” package, which essentially means that they don’t need to spend a single euro if they don’t want to.

One area in which Cyprus may keenly feel the absence of the

UK around the EU table concerns tax matters. Many of the big players in the EU are in favour of various forms of tax harmonisation, including a Common Corporate Tax Base (CCTB). This is not a development that Cyprus supports, not least because one of the island’s key sell-ing points to investors is its low 12.5% rate of corporation tax. In this, Britain

was a strong ally and many observers have pointed to the fact that, without its support, it

will be harder for Cyprus to ‘stand up’ to pressure on the issue. It is notewor-thy that, in one of his first comments after the referendum result, Chancellor George Osborne announced that he intended to propose a reduction in the UK’s corporation tax rate from 20% to 15%.

In terms of trade, the UK and Cyprus have longstanding and close economic

ties. Cypriot exports to the UK comprise 10% of the country’s total while trade in services between the two countries represents 20%. It is thought that the UK’s decision to leave the EU will cer-tainly affect Cyprus’ exports in both the long and short term, although everything will ultimately depend on what kind of deal the UK concludes with the EU and

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T H E B U S I N E S S M A G A Z I N E O F C Y P R U S

I S S U E 6 4 J U L Y 1 7 , 2 0 1 6

C O N T E N T S6 | EDITORIAL

8 | BUSINESS BRIEFINGEconomic & Business Highlights of the past month. 12 | MY WAY Petros Livanios’s management style.

13 | FIVE MINUTES WITH… Charalambos Samir

16 | THEY SAID WHAT?A selection of the month’s more memorable utterances by Cypriots in the public eye.

OPINION40 | Brexit: The Aftermath By Michalis Economides

FEATURES18 | Cyprus Fiduciary Association IInterview with outgoing President George Savvides.

22 | Cyprus Fiduciary Association IIInterview with incoming President Christos Michael.

34 | Getting Used to the New NormalInterview with Borys Humeniuk, Ukraine’s Ambassador to Cyprus.

40 | AntiCIPAting Investment OpportunitiesNatasa Pilides on her new role as Director-General of the Cyprus Investment Promotion Agency.

44 | No Retirement Plan Ninos Hadjirousos FCA has no intention of stopping work yet.

46 | Interesting TimesInterview with George Mountis, Managing

50 | Wishful Thinking or Real Potential?Cyprus needs to do more if it is to become a major player in the global fund Industry, says Christopher Stuart-Sinclair.

52 | €21 Trillion and Counting...EFAMA Director-General Peter De Proft on Europe’s thriving fund industry.

54 | International Funds SummitPhotos from the event.

58 | One Year OnDr. Christoforos Hadjikyprianou, CEO of

year of the Microsoft Innovation Centre.

60 | Learning never EndsCIM Deputy Director-General Yangos Hadjiyiannis on two new courses.

COVER STORY

26 | Brexit: Crisis or Opportunity for Cyprus?

The possible impact of the UK’s decision to leave the European

Union on key sectors of the island’s economy.

40

62 | Reinventing the Accounting ProfessionInterview with Richard Spencer, Head of Sustainability, ICAEW.

65 | The Importance of SubstanceBy Constantinos Katchamis

68 | IN GOOD COMPANYFuelling the talent engine at Staroil.

60

76

80 | WHAT’S ONGold’s guide to the best cultural events of the coming month.

82 | A DAY IN THE LIFEStelios Anastasiades.

71 | BUSINESS CLASSNatalia Rudakova

72 | MY COLLECTIONRoger White and his ‘self

75 | BOOKSHELFFive of the best new business titles.

76 | LUNCH WITH GOLDFiona Mullen, Director, Sapienta Economics.

46

82


| EDITORIAL |

John Vickers,Chief Editor

[email protected]

Going…Going…Gone

hen 17,410,742 people state that they want something, it would be foolish to ignore their wishes. On the other hand, what should be done about the 16,141,241 who have stated the opposite view? In a democracy, the size of the majority does not matter and, in theory, a single vote would still have won the day for the Leave campaign in the UK’s June 23 referendum on whether to remain in the European Union or to leave it. It is probably just as well that the difference was more than a million votes, though a recent

poll has already suggested that 1.7 million people now regret their decision to support Leave.Following the unexpected turn of events regarding the successor to David Cameron and a new Prime Minister being installed in 10, Downing Street on July 13 instead of the planned September 9, Theresa May has made it clear that she is determined to make the best of the situation created by the vote to leave the EU and that there is, essentially, no turning back.

The result of the referendum was of considerable interest to Cyprus, given the island’s his-torical, cultural and commercial ties with the UK and the fact that a sizeable British expatriate community exists here (you may even belong to it). It was, therefore, perhaps inevitable that this issue’s cover story would deal with the so-called Brexit, despite the fact that any ideas about its potential effect on Cyprus are obviously premature. We sought the views of two economists, as well as those of others with links to both countries, and we present them on pages 26-33. You will also see that, in several of this month’s interviews, we could not resist asking the subjects for their opinion about the vote, which appears to have taken everyone by surprise.

It’s not all Brexit in this issue of Gold. Indeed, there is far more about Limassol in the extra publication that you will have received with the magazine. But in addition to interviews there with Mayor Andreas Christou and LCCI President Costas Galatariotis, the main part features an extensive discussion with Ukrainian Ambassador Borys Humeniuk (page 34), the outgoing and incoming Presidents of the Cyprus Fiduciary Association, George Savvides and Christos Michael respectively (pages 18-24), with Natasa Pilides, the newly appointed Director-Gener-al of the Cyprus Investment Promotion Agency (page 40), veteran accountant and parliamen-tarian Ninos Hadjirousos (page 44), the Managing Partner of Delfi Partners, George Mountis (page 46) and many more.

Plus, you have two magazines for the price of one – and a new lower price at that. And it has nothing to do with Brexit! Enjoy your summer.

MANAGING DIRECTOR George Michail

GENERAL MANAGER Daphne Roditou Tang

MEDIA MANAGERElena Leontiou

EDITOR-IN-CHIEF John Vickers

JOURNALISTSArtemis Constantinidou, Voula Loizou

CONTRIBUTORS TO THIS ISSUE Michalis Economides, Christos Karaolis,

Constantinos Katchamis, Fiona Mullen, Savvas Savouri,

ART DIRECTION Anna Theodosiou

SENIOR DESIGNERAlexia Petrou

ASSISTANT DESIGNERStephanie AndreouPHOTOGRAPHY

Emma Louise Charalambous, Jo Michaelides, Andreas Loucaides

MARKETING EXECUTIVE Kevi Chishios

SALES MANAGER Irene Georgiou

SALES EXECUTIVE Stavros Epifaniou

OPERATIONS MANAGER Voulla NicolaouSUBSCRIPTIONSMyria Neophytou

PRINTERS Cassoulides Masterprinters

CONTACT5 Aigaleo St., Strovolos 2057, Nicosia, Cyprus

Mailing address: P.O.Box 21185, 1503, Nicosia, Cyprus

Tel: +357 22505555, Fax: +357 22679820e-mail: [email protected]

subscriptions: [email protected]

ISSN 1986 - 3543PUBLISHED BY IMH

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ISSUE 64JULY 17, 2016PRICE €2.00

CRISIS OROPPORTUNITYFOR CYPRUS?The impact of the UK’s decision to leave the EU on key sectors of the island’s economy

PPRICE PR €

INVESTMENTNatasa Pilides

on her roleas CIPA D-G

FIDUCIARY SERVICESCFA presidents

Christos Michael & George Savvides

INTERVIEWSBorys HumeniukGeorge MountisRichard Spencer

PLUSBusiness BW B

Opinion & More

T H E F I R S T N A M E I N G O O D M A N N E R S

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ARISTO REPAYS €283 MILLION

Aristo Developers Ltd has announced the completion of an agreement with the

Bank of Cyprus for the full repayment of all the Group’s loans to the Bank,

amounting to €283 million. Through a debt-for-assets swap arrangement, Aristo

Developers has transferred properties to the Bank, which amounted to at least

scale Venus Rock Golf Resort project has been included in the exchange, the

implementation potential of which is now increased and accelerated.

CO-OP NPLS BELOW €6 BILLION

The Cooperative Credit Institutions (Co-ops) have stepped up the pace of re-

structurings, reducing their non-perform-ing loans to below €6 billion, some six

months before the target date. Coopera-tive Central Bank CEO Nicolas Hadjiyian-nis said, “We are well within our targets for a loan restructuring of over €1 billion

in 2016 and we are very pleased with the huge progress achieved,” he said, adding

that the Co-op sector has achieved re-structurings totalling €1.4 billion or 13,000

accounts in the past 12 months.

€32 Million Loan for UCY Campus ExtensionThe University of Cyprus has been granted a €32 million loan by the Council of the Europe

to 2023, the university will be expanded and modernised. The loan will enable upgrades to cam-pus infrastructure. “The science and innovation centre will be designed, the energy centre for

previous phase of the campus development.

NPLS

BUSINESSBRIEFING

EDUCATION

FIDUCIARYONEWORLD

Acquires Freemont Group -

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Ceremony PostponedThe 5th CIPA International

Investment Awards ceremony hosted by Gold, which was due to be held on 23 June 2016, was postponed by the Cyprus Invest-ment Promotion Agency (CIPA) and Gold magazine due to that

week’s tragic events caused by for-est fires in Cyprus, The event will now take place at the Presidential Palace, Nicosia, on Wednesday. 7

September 2016.

Eurofast and the Cyprus International Institute of Management (CIIM) recently signed a Memorandum of Understanding to seal their cooperation. Both organisations have agreed to develop a relationship, helping CIIM stu-dents and graduates develop their employ-ability skills by gaining experience. CIIM’s Undergraduate and Graduate Programmes include an internship as an option to help

students gain relevant work experience and have a realistic opportunity for on-going em-ployment. Eurofast will host CIIM students for a period of three to six months. Over the years, Eurofast has been cooperating with educational institutions in Cyprus and in other countries creating a network of future job can-didates who have experience working with the company.

C P d

CO OP NPLS

13,295

VEHICLE REGISTRATIONS IN

SOME 11,188 WERE PASSENGER SALOON CARS.

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VEHICLE REGISTRATIONS IN

SOME 11,188 WERE PASSA ENGERSALOON CARS.


MATTHEW The returning British High Commissioner,

Matthew Kidd, presented his credentials to

President Anastasiades

the heart of my second mission will be support

a settlement of Cyprus’ own division.” Kidd served as BHC from

2010-2014.

KOCH The Maritime Academy Cyprus has appointed Capt. Eberhard Koch, Chairman of the ÖL

Shipping Group, as its Chairman. Capt. Koch is a dedicated advocate of Cyprus and enthusiastic

about “giving back” to the island that has been his

home for almost 20 years.

Qualco Group, a leader in the development of software

and the provision of services for the Credit and

Debt Portfolio Management, has appointed Andreas

Manager for Cyprus. He will be responsible

for developing and implementing commercial

strategies for the local market.

PEOPLE

ECONOMIDES KRANOS CHAMBERSFIELD IN ISRAEL

LEGAL

The Interna-tional Law firm Economides

Kranos Chambersfield has announced its global expansion through a new physical presence in Israel. The firm now has offices in Cyprus, the UK, Sin-gapore, Albania, Bahrain and Israel. Founder and CEO, law-yer Michalis Economides,

a member of the Cyprus Bar Association and a Barrister of the United Kingdom, said that the objective of Economides Kranos Chambersfield law firm is to form a global presence that will provide a full range of integrated litigation and corporate solutions, tailor-made to each customer, that will enable them to perform

effectively in any jurisdic-tion.” The firm, through its subsidiary corporate provider company, KnightsWorth, now offers corporate and fiduciary services in more than 20 jurisdictions. Economides Kranos Chambersfield follows a customer-driven philosophy, based on the notion “Think globally but act locally”.

LARNACA AIRPORT HONOURS GLAFCOS CLERIDES

On the occasion of the celebrations for the tenth anniversary of Hermes Airports President Nicos Anastasiades unveiled a plaque in the terminal building in honour of the late President Glafcos

Clerides. Meanwhile, Larnaca Airport was highly commended as the Best European airport in providing services for people with disabilities, during the 12th General Assembly of the Airports Council International (ACI) – Eu-

commended airport for the Accessible Airport

Award was also recognised for “the positive travelling experience it gives to people with dis-

with accessibility standards”.

LARNACAAIRPORT

TOURISMCYPRUS EXPECTS

3 MILLION TOURISTS THIS YEAR

Close to 3 million tourists are expected to visit Cyprus in 2016, according

Yiorgos Lakkotrypis, Minister of En-ergy, Commerce, Industry and Tourism who noted that, although occupancy

prolonged gradually by a few weeks in March and November, in order to maintain the momentum. He was

speaking before the result of the UK referendum, which many observers

-bers from next year.

Cyprus raised €120 million in revenue this year from civil marriages that

took place on the island, with couples mainly arriving from the UK, Israel,

Lebanon, Russia, and other Eastern European countries. According to

of the Cyprus Tourism Organisation (CTO), it is a market that has not been taken seriously in the past. The num-ber of civil marriages is around 8,000

year, with anything between 10 and 60 additional guests staying on the island

for the wedding celebrations.


BUSINESSBRIEFING

AVIATION

Charlie Airlines, the Cyprus-based subsidiary of Russia’s

-ernment €1.2 million to use the brand name and logo of Cyprus Airways, which sus-pended operations at the

years of existence. Charlie -

plication for a domestic air

BEST TALL BUILDING IN EUROPE

J ean Nouvel’s White Walls, home to EY Cyprus’ Nico-sia Office since November 2014, has been named the Best Tall Building in Europe 2016, by the Council on Tall Buildings and Urban Habitat (CTBUH). It was selected

among 132 buildings due to its distinctive char-acteristics, including the natural flow of light, perforated walls, lofty balconies and the internal espaliered gardens. The 67metre-high building is one of the tallest structures in Cyprus. White Walls will now compete for the title Best Tall Building Worldwide, which will be announced in November 2016. The striking building was chosen in 2014 to house the new Nicosia head office of EY Cyprus, which occupies all eight floors of its office space. A company statement notes that the choice of Jean Nouvel’s tower was “in line with EY’s global operating model and the broader concept of a ‘Workplace of the Fu-ture’, based on both its unique aesthetic and its enhanced functionality that encourages teaming, flexibility and collaboration.”

House Resolution on EU Russia

The House of Representatives approved a resolution on July 7 calling for the lifting of the sanctions imposed by the European Union on the Russian Federation. The resolution was approved by 33 votes in favour. The ruling Democratic Rally party DISY abstained. The resolution noted that “the sanctions imposed by the European Union against the Russian Federation have proved counterpro-ductive and in no way have helped to solve the crisis in Ukraine.” Following the vote, a statement issued by the Embassy of Ukraine in Nicosia described the resolution as “definitely not favourable to the promo-tion of traditionally friendly and constructive Ukraine-Cyprus relations.”

IN THE NEWS

Orion Airways is in the

and commercial licences with a view to starting

December 2016. Orion Airways is a Cypriot airline,

an international investment fund based in Switzerland,

and Larnaca.

Etihad Airways recently cel-

of its non-stop Larnaca-Abu

every Monday, Wednesday

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The first issue of the quarterly magazine Accountancy Cyprus to be published under a new collaboration between the Institute of Certified Public Accoun-tants of Cyprus (ICPAC) and IMH will be available shortly.

Accountancy Cyprus is arguably the oldest magazine in Cyprus, having been pub-lished continuously by ICPAC since 1982 with the objective of keeping its members up to date with the latest developments in the accounting profession. ICPAC remains the publisher of the magazine while IMH is responsible for its editorial content, de-sign, printing, distribution and commercial management. The cover story of the July issue of the magazine is “The Future of Cyprus as an International Business Centre.”

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Accountants of Cyprus (ICPAC) on

Edate energy-related news from Cyprus

and the rest of the world. The portal, which is the result of cooperation between the Cyprus

and IMH, aims to present well-rounded and objective information on all energy-related issues for businesses, professionals and consumers in Cyprus and to promote all the organizations, bodies and companies active in the broader energy sector.In addition to daily rolling news, EnergyNews.com.cy sends out a weekly newsletter to thousands of recipients keeping them fully updated on energy-related developments.

H oliday car hire company Goldcar has opened a franchised branch in

main entrance of Larnaca International Air-port. It follows recent openings in Bucharest, Corfu, and Cancun. Commercial and fran-chise director Manuel Nunez said that the new franchise opening continues to drive Goldcar business growth worldwide.The company currently operates in 13

Europe and in other international destina-tions.

PUBLICATION

NEW IN CYPRUS

gold magazine issue 64 first 10 pages

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