For Lebanese businesses, struggling in the crisis, Cyprus offers opportunities.
Hundreds of Lebanese have simply up and moved to Cyprus. Others have decided to stay in Lebanon and partner up with Cypriot companies, in order the create a business bridge between the two countries.
Joumana Khoury Younes is helping to build these bridges. She is the owner of the Beirut-based “Confiden,” a Corporate Services & Consultancy firm dedicated to providing specialised assistance to clients, in matters related to their personal and business setup, management and development. Founded in November 2019 for “a good reason” Joumana told the Cyprus Mail over the phone.
“After 17 October 2019, the situation in Lebanon became very difficult and the economy collapsed entirely. Many of my friends and acquaintances were looking for a way out immediately. So I thought it was a sign for me to do something”.
Joumana explains that Cyprus was her first choice because “the island is very close to Lebanon and it grew on me since I started visiting it for vacations and I made a lot of friends”.
“Another good reason is the ideal geographical position of Cyprus, at the crossroads between Asia, Africa and Europe, making it an attractive business hub for international investors” she adds.
Joumana did not want to leave Lebanon but instead she was looking for a way to expand her business and increase her profit from her base in Beirut so she quickly set up a strategic alliance between “Confiden” in Beirut and “Emilianides Katsaros Group (EK Group),” based in Nicosia and Limassol.
But why would a Lebanese investor go to another Lebanese company instead of going directly to a Cypriot company? Joumana answers confidently “although the Lebanese and Cypriot cultures are very similar in many ways. But when it comes to business Lebanese investors have specific needs, and a total different market approach. It would be easier for another Lebanese to understand them and help them integrate and supply their needs in partnership with a Cypriot Company”.
“Such a partnership is truly a business bridge between Lebanon and Cyprus” she reiterates.
“We did not get the time to engage in proper networking due to the corona pandemic but so far things are looking great. We already have a considerable amount of clients” Joumana tells CM.
“Another good reason for Lebanese businessmen to deal with us is the travel restrictions that are currently imposed. Without the need to travel we are able to meet their needs and establish their companies in Cyprus,” she adds.
On the other side of the coin, a few Cypriot companies have their eyes on the Lebanese markets. Since the Lebanese economy has hit rock-bottom a few months back, the Lebanese banking system has gone into “hibernation mode” when it comes to providing services for clients and businesses.
Credit cards provide a good example. A customer that had an international spending limit of $5000 on his credit card before 17 October 2019 is now able to spend only $50 outside Lebanon with the same card. For customers and business owners alike this scenario is unbearable!
Many Lebanese have lost their trust in Lebanese banks and are now looking for banking services or e-wallets elsewhere.
“The financial services industry in Cyprus has many solutions to offer,” says Shavasb Bohdjalian, a stakeholder in multiple Cypriot financial companies in an interview with the Cyprus Mail.
“Cyprus is an ideal gateway for business operations, not necessarily related to the Cyprus investment for passport scheme,” said Bohdjalian, adding that one of the most effective and practical ways to secure the advantages of Cyprus as a business gateway, is the establishment of a Cyprus company, to be eligible to receive the services offered by Cyprus financial institutions.
Citing some examples of efficiency, Bohdjalian said “Lebanese exporters can route their business through a Cyprus subsidiary which will immediately qualify for trade finance from alternative finance providers such as Eurivex Trade Finance Limited (“ETFL”).”
Boyadjian also explains that “The Cyprus entities can open accounts with banks or Electronic Money Institutions (EMIs) licensed by the Central Bank of Cyprus (CBC) such as Sureswipe EMI, operating under the “Revsto” trade name, which offers very fast and efficient opening of e-wallets. The e-wallets can then be connected to unique IBAN accounts for SEPA and Swift transactions and secure MasterCard (physical and virtual) for their EU based employees.”
“An account with Revsto (https://www.revsto.com/) will also be useful to make payments to suppliers for direct shipment of goods to Lebanon through the Cyprus entity.” he adds.
Regarding future cooperation with Lebanese introducers, Bohdjalian concludes “due to the warm relations both at government level and at people level between Cypriots and Lebanese, the cooperation prospects are excellent and very promising.”