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The Brexit conundrum for expats in Cyprus

As the referendum on whether the United Kingdom is to remain a part of the European Union nears, many of the more than 24,000 British expats in Cyprus are hoping that the republic’s special relationship with the UK will lessen the possible disruptions caused by a Brexit.

British expats in Cyprus – and Malta – are in a somewhat different situation compared to those living in the rest of Europe, as the two islands share close ties with the UK through Commonwealth membership and their colonial past.

But even if the special relationship holds true for Cyprus and Malta, there remains general uncertainty over what a Brexit would mean to British expats living in the EU.

According to an investigation by The Times earlier this week, concern over those uncertainties could “lead to an exodus of British expatriates from the continent”.

About a hundred British residents of Spain leave the country every day, and uncertainty over things like continued healthcare benefits and the value of the state pension if Britain withdraws is set to bring a further increase in the number of those deciding to repatriate, the article said.

If the UK were to opt out, complications – in addition to healthcare and pensions – for expat Brits could also include restrictions on property ownership and doing business in their host country.

“The main problem with assessing what the situation might look like if the UK exits the EU is that we just don’t know – it’s uncharted territory,” research fellow at the London School of Economics James Ker-Lindsay told the Sunday Mail.

According to Ker-Lindsay, if the Leave camp prevails in the referendum, it will be followed by negotiations for an agreement on the new status quo, either between the UK and the union as a bloc, or between the UK and each individual EU member state.

“We don’t know what the terms of the exit will be, and we don’t know how long completing it might take,” he said.

He believes that the special relationship between the UK and Cyprus should mean coming to an agreement will be relatively easy.

“But what about the UK and Poland? Will we send the Poles back, and then will Poland send Brits back? We just don’t know how it’s going to end up working,” he said.

“Still, what’s interesting is that, even as most expats are retirees, who have taken advantage of the EU’s freedom of movement to retire overseas, opinion polls show that a majority of people in the 55 to 74 bracket harbour the most dislike for the EU. It’s a paradox of sorts.”

For retired chartered accountant and British expat living in Cyprus Brian Lait, such arguments are irrelevant.

“I have absolutely no concerns about Brexit, and believe that those who do are either scaremongering or haven’t studied the EU very much and are suddenly waking up to what it’s all about,” said Lait, who has written several articles in favour of a Brexit for the Sunday Mail.

“Has any member of the EU, or the so-called EU leaders, actually stated that Brits must leave the EU if the UK leaves? No. Similarly, the UK has not in any way, shape, or form threatened other EU nationals living in the UK with expulsion.”

Lait likened the UK’s possible departure from the EU to a divorce, noting that they are generally messy, “especially after 40 years of marriage”, and a settlement will take years to work out.

“But it will get done, and will in all probability be fine for those EU citizens currently in the UK, and the UK citizens in other EU countries.”

And what about the rest of the inconvenience likely to befall expats if the UK has voted to leave?

“I want my own country to have its own sovereignty,” Lait said.

“I’ll bear the pain of having to apply for a resident’s permit for example, if it comes to that, just as I did in 2001 when we arrived here.”

Similarly, marketing and business development manager at cyprusexpat.co.uk Penelope Hearns says she is “not worried about Brexit”, mainly because she feels it is unlikely unsuspecting expats will one day wake up to a difficult predicament.

“As with most changes in people’s lives, do the research, plan ahead, and don’t leave everything to the last minute,” she told the Sunday Mail.

Hearns feels the close ties between the United Kingdom and Cyprus – a long and difficult ‘special relationship’ – are a form of insulation against the risks a Brexit could pose for expats in Cyprus.
“Property ownership should not become more difficult, as the Cyprus government will not turn away potential buyers for property on the island,” she reasoned.

“They are desperate to revive the devastated property market, so will not place barriers there.”
But the health arrangements, she added, will have to be renegotiated.

“If the Cyprus government will not give reciprocal arrangements, then expats in Cyprus will have to purchase private health insurance, or be treated in the UK, and the reverse situation will apply for Cypriots in the UK,” she said.

And the issue of the fall in the value of the British pound because of a Brexit is but one scenario, with many factors that could affect the exchange rate, such as the Euro crisis in recent years, Hearns noted.

The bottom line, according to Hearns, is that Cyprus “had favourable agreements in place with the UK before it joined the EU, so many of those will remain”.

And changes after a Brexit would also take time to implement, she said.

“British expats in Cyprus will have at least two years to arrange their affairs, as the UK will still be a member for two years, whilst the haggling over agreements continues with the various EU governments. There is also the possibility of an extension to this two-year period, if all the EU members agree.”

But even if the impact of an exit is not as dramatic as some of the proponents of staying in claim it might be, and even if Cyprus’ close ties with the UK do allow for special treatment, additional red tape for British expats here is all but a certainty.

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