Cyprus

Cyprus is the third largest island in the Mediterranean (after Sicily and Sardinia) with an area of 9251 sq kms.  It is strategically situated in the far eastern corner of the Mediterranean, at the crossroads of Europe, Africa and Asia, and in close proximity to the busy trade routes linking Europe with the Middle East, Russia, Central Asia and the Far East.

Cyprus’ prosperous economy is based on the free enterprise system.  In 2008 it was classified by the IMF amongst the 32 advanced economies of the world, its per capita GDP is, at EUR 20,793, just above the average of the European Union.  Cyprus is a major tourist destination as well service and financial centre.  From 1 January 2008, the country entered the Euro zone and adopted the euro and monetary policy is dictated by the European Central Bank.

The retail and consumer sector is developing very fast in Cyprus, especially following the accession of Cyprus to the EU in May 2004. This development has signaled a period of insecurity for companies in the industry where traditional boundaries that used to define geography, store types, trade channels, trading partners and organizations functions are very volatile.

In order to be successful, companies in today's complex and fast evolving retail industry must be able to respond quickly to the following challenges:

• Increased competition (New competitors are continuously entering the market).
• Changing consumer demands (Consumers are becoming more demanding and able to shop around in order to pay less).

Companies in the retail and consumer sectors must rethink their earnings strategies and look to new efficiencies to drive bottom line growth. Maintenance of margins through balancing costs and pricing will remain a challenge in this ever-competitive industry.

Large scale distribution is still not very developed in Cyprus, with retail trade being more dominant. The total turnover achieved by large scale distribution and retail trade represents 13% of the country's GDP and employs 15% of the active population. There are more than 3000 distribution outlets (from grocery shops to superstores) in Cyprus. 60% of these distribution outlets are retail shops and they achieve only 23% of the turnover. On the other hand, the superstores of the island alone achieve more than 40% of the sales.

Chains of shops like Orphanides, Carrefour, Alpha-Mega, Papantoniou and Metro. Furthermore, there are also parallel trade and private label stores islandwide such as Smart, Plus, Elomas and other Discount stores.

Franchise shops have been quite successful for the last few years: big fast food shops from America, international car rent companies and big brands of the clothing sectors have all set up their franchises in Cyprus.

The average end-customer is more aware of the global market and the demand for quality is growing bigger everyday.

By Road
Road transport is the most developed way of transport on the island. The modern roads connect the principal cities of Cyprus - Nicosia, Limassol, Larnaca and Paphos - together.  The road infrastructure quality is the same as the rest of the European Union. Left hand driving system exists in Cyprus. The network of secondary roads is narrow and poorly maintained. The road network of Cyprus comprises of 11,408 km of roads.

By Rail
There is no railway network in Cyprus.

By Sea
The principal trade port of Cyprus is in Limassol, located towards south of the island. The 2nd important trade port is in Larnaca, located towards south-east of the island. The ports of Limassol and Larnaca alone register two-thirds of the shipping freight movements. 55 shipping lines cover Cyprus in their regular routes.

By Air
Cyprus has 2 international airports: Larnaca and Paphos, situated at 50 and 150km respectively from Nicosia.  On average, these airports register a weekly traffic of 1249 flights, shared between 36 international air companies and 81 charter services.

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