A Golden Visa program, granting residence status to foreign nationals who purchase property, has brought some 4 billion euros in revenue to Cyprus, outperforming by far a similar program that has been operating in Greece for the past three years.
Cypriot authorities raised the revenue over the past year thanks chiefly to purchases by wealthy Russians, according to sources. The condition for the acquisition of a Cypriot residence permit is for an investor to spend at least 2 million euros on real estate or 2.5 million euros on Cypriot government bonds or a company.
The sum of 4 billion euros is impressive, corresponding to 25 percent of Cyprus’s gross domestic product. This compares to the 2.8 billion euros in direct investment recorded in Greece last year, a sum that accounts for just 1.5 percent of the country’s GDP.
According to Cyprus Finance Minister Harris Georgiades, some 2,000 passports have been given to foreign nationals from non-European countries. Around half of these are believed to have gone to Russian nationals, Bloomberg reported, citing estimates by PricewaterhouseCoopers.
A similar Golden Visa program in Greece, which has been running since mid-2014, offers five-year residence permits to foreign nationals who spend more than 250,000 euros on real estate purchases.
The program has seen some success but not to the same extent as its Cyprus counterpart. The latest official figures, released in late January, show that Greek authorities have issued 1,573 residence permits to foreign investors in Greek real estate. Most of the visas (664) went to Chinese nationals, followed by Russians (348), Egyptians (77), Lebanese (73) and Ukrainians (67).
According to sources, the relative success of the Cypriot program can be partly attributed to traditionally strong ties between Russia and Cyprus and the relative swiftness of procedures in Cyprus (it reportedly takes just six months for a visa to be issued from the moment an application is lodged).
The success of the Golden Visa program in Cyprus is believed to have played a major role in keeping the property market alive following fears that a banking crisis could lead to its collapse.
Meanwhile the influx of Russian money in exchange for residence permits is something that has not been well received by the European Commission, according to sources.