What are the benefits if you invest in Cyprus?
During the last 20 years we have seen a rather remarkable expansion of numerous multinational companies as a result of fervent and continuous burst of international investments.
The rise of worldwide organization structure has triggered a convergence between several economies from states all around the world. As a result, most products and services are now available to almost every corner of the earth. This interest for all kinds of overseas investments continues to grow and it is actually the key factor that will eventually overturn the tide of the current financial downturn, by expanding the reach of even more companies to international markets.
Cyprus is, and has been for several years now, a key player in this burst of international investments. Boasting a strategic position right on the crossways between three different continents – Europe, Asia and Africa – an excellent financial infrastructure and one of the most advantageous tax systems in the Europe and Eastern Mediterranean, Cyprus has attracted the interest of numerous investors that want to expand their business overseas.
But why investing overseas is such a great idea? Here are 5 reasons that will give you plenty of food for thought.
1. Overdeveloped Markets
Markets that have been developing for decades eventually stall or at least satiate and need some time to recover – but corporations do not have that luxury. Their survival depends on their ability to preserve their growth and revenues.
In an overdeveloped market, of course, there is no other way of maintaining growth than expanding to other still developing markets. Such an expansion, of course, requires some careful planning, especially regarding the selection of the market.
On the other hand, even overdeveloped markets may gladly accept new products and services variety from other developed markets, while corporations are often willing to invest in such markets just to get a percentage of the market.
2. Advantages of International Diversification
In general, corporations tend to invest and expand to other markets in order to reduce their exposure to just one market and the unavoidable dangers of its cycles. For instance, if one country suffers from a prolonged recession while another country in a different region or continent experiences a phase of growth, a corporation operating in both economies will suffer much fewer losses and face less volatility risk.
This widely used and praised way of international diversification has been proven an excellent option for entities that wish to shield against local recessions and crisis.
3. Minimizing Expenses
Numerous corporations have been investing great sums of money overseas in developing countries like Tanzania, India, China and Brazil, seeking ways to minimize production costs and general expenses.
Such serious benefits are directly associated with the abundant cheap labor available in such still developing economies. Corporations with large and intensive production processes find it a prudent solution to invest overseas and create production units abroad, thus succeeding to minimize costs without sacrificing quality. Moreover, their cooperation with qualified and experienced tax experts from worldwide can save for new registered companies significant expenses.
4. Transportation Cost
A great number of multinational corporations sell a significant percentage of their products and offer their services to developing countries. That means that they are forced to spend large sums of money for the transportation and distribution of their products.
A great solution for cutting on transportation expenses is investing abroad and creating production units in the regions where these corporations sell their products. While such an investment entails considerable cost, it will eventually contribute to the company’s further development.
5. Tariffs and Quotas,
Many countries impose import quotas, custom duties and high tariff rates on foreign corporations. Import quotas limited the amount of products that actually reach a local market. Tariffs are taxes on imports imposed by governments either to increase their revenue or to reduce imports. One way companies use to handle such restrictions is to create production units in countries where they sell their products. Immediately, tariffs and quotas are out of the picture.
Why Invest in Cyprus?
Cyprus is a country that offers several advantages to companies and investors that are interested in expanding their businesses overseas. Considerably low taxation, excellent state services, simplified procedures and all of these under the shield of the European Union’s legislation. Cyprus is indeed an option worth considering. The only thing is to cooperate with a professional team of consultants. Request more information about what do you need in order to set up a company in Cyprus.
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