The assumption of the Presidency of the Council of the European Union in the first half of 2026 offered a significant opportunity to strengthen Cyprus' international image, Elias Neocleous, Managing Partner of Elias Neocleous & Co LLC, states in an interview with InBusinessNews.
Commenting on the economy and the legal sector's role within it, Neocleous continues, "Overall, the picture is positive and at the same time realistic. The challenges are real, but the Cypriot economy and the legal sector show that they have the ability to adapt and continue to operate effectively within an ever-changing international environment," at the same time expressing the hope that the geopolitical unrest will subside and that normalisation will come about in international transactions and activities, which will also return the Cypriot economy to its normality.
"Our priorities remain the evolution of our technology-driven business model with the aim of improving the quality and speed of our services for the benefit of our customers," he adds.
How do you assess the course of the Cypriot economy and your sector during the first half of 2026? What developments stood out positively or negatively and to what extent were the predictions you made at the beginning of the year confirmed or overturned?
The first half of 2026 confirmed that the Cypriot economy, and by extension the legal sector that supports it, operates in an environment of increased complexity, but also of remarkable resilience.
Initial forecasts for a moderately positive course were broadly confirmed, although developments in the Middle East created an additional level of uncertainty, affecting both investment sentiment and the flow of certain cross-border transactions.
The assumption of the Presidency of the Council of the European Union was something that stood out, offering a significant opportunity for Cyprus to strengthen its international image and reposition itself as a reliable European destination for investment and business. This is also reflected in the maintenance of foreign direct investment, which remains at high levels despite the negative effects of the war. On the positive side, the return to normality of the tourist flow to Cyprus.
Overall, the picture is positive and at the same time realistic. The challenges are real, but the Cypriot economy and legal sector show that they have the ability to adapt and continue to operate effectively in an ever-changing international environment.
What are your expectations and priorities for the second half of 2026? Where do you see growth opportunities, but also what challenges do you believe will determine the course of the market by the end of the year?
We hope that the geopolitical unrest will subside and that there will be a normalisation in international transactions and activities, which will also return the Cypriot economy to normality.
Our priorities remain the evolution of our technology-driven business model with the aim of improving the quality and speed of our services for the benefit of our customers.
At the same time, the challenges are equally clear. The lack of specialised human resources is an ever-increasing issue, especially in areas that require a combination of legal and technological knowledge. At the same time, the need to modernise state bureaucracy and procedures remains critical, as it directly affects the speed and efficiency of transactions.
Overall, the second half will be determined by the ability of all parties involved to adapt in a timely manner, investing in both technology and people, within a more modern and functional framework.
To what extent have geopolitical developments, and in particular the crisis in the Middle East, affected the economy in general and your industry in particular? Have they created more risks, upheavals or even new opportunities?
Geopolitical developments, and in particular the crisis in the Middle East, have not only affected the general investment climate, but have also acted as a catalyst for a more substantial reassessment of risk by businesses and investors. The current situation has brought both pressures and opportunities, as expected. What has stood out is the speed and maturity with which businesses have reacted, adopting a more structured approach.
In practice, we saw an increased volume of requests that were not just about new investments, but mainly about reviewing existing structures, such as group restructurings, transferring activities within the EU, reviewing exposure to specific jurisdictions and strengthening intergovernmental frameworks, which shifted legal work from a transactional to a more strategic advisory level.
At the same time, the initial uncertainty expressed by clients regarding Cyprus's position in the wider region was real. However, the country's management of the situation at the level of institutions, infrastructure and international positioning was reassuring.
The emphasis on compliance with European standards, the operational continuity of services and the speed of response of professional bodies reinforced the perception that Cyprus is not a "regional risk", but part of a stable European framework.
In this sense, a more complex opportunity has emerged, namely not just attracting new investment, but repositioning activities with a long-term perspective. Clients are no longer looking only for tax efficiency, but for jurisdictions that can withstand crises. And that is where the value of the legal and institutional environment is truly judged.
If you could point to one intervention from the state or market that would strengthen the resilience of the economy in the second half of the year, what would it be?
If I had to single out one intervention that could substantially strengthen the resilience of the economy in the second half of 2026, it would be the accelerated and substantial modernisation of public administration, with an emphasis on digitising processes and reducing bureaucracy.
In an environment where speed of decision-making and predictability are critical factors in attracting and retaining investment, the existing complexity of procedures often acts as a deterrent. Delays in approvals, lack of interoperability between authorities and reliance on manual processes are not consistent with an economy that seeks to be internationally competitive.
For the legal and wider professional community, this translates into additional operational costs, uncertainty and difficulty in properly planning cross-border transactions. Very often, the value of legal advice is not tested at the level of analysis, but on whether it can practically "work" within an administrative system that has not yet fully adapted to modern needs.
The intervention, therefore, is not only about technology as a tool, but a broader change in mindset, namely the transition to a more flexible, transparent and efficient state, which acts as an accelerator and not as an obstacle to business activity.
In a period of international uncertainty, internal functionality becomes a competitive advantage and this is perhaps the most immediate and controllable area in which we can invest as a country.
(Source: InBusinessNews)
