WM issue 5

| 101 | OBJECTS OF DESIRE While providing a safe haven from the frantic pace of the outside world, our home is also a reflection of our individual taste and personality. Ideally, every object inside it should be one that we not only find useful but also cherish. And sometimes, there are items with no particular use which still bring joy into our lives, simply by existing. Finding the right furnishings and other décor for the home is not always easy. Fortunately, there are a number of select stores in Cyprus, whose expert personnel will use their well-honed experience and share their highly developed taste to present you with a carefully curated selection of objects of desire, helping you turn your house, apartment or penthouse into the home you will truly love and enjoy. Photos by TASPHO



O B J E C T S O F D E S I R E | 103 | Inspiring Concepts Emilia Hadjicosti, Director of ambiance & Co, reveals the thoughts that go behind the selection of the high-quality items in the store, while also underlining the importance of establishing relationships of trust as she shares her clients’ creative journeys. How long has your boutique been around? What made ative journey and with valuable experience, as well as the know-how of all you decide to enter this sector? members of our team, we are able to deliver ideal and tailor-made solutions. I have always had a passion for art and design. After complet- ing my studies in Milan, the capital of design, where I was What are your favourite picks at the moment? exposed to a plethora of artistic wonders, I was absolutely positive that I Frigerio’s new collection! And the new designs of Elmar kitchens are wanted to be part of the interior architecture world. As a result, ambiance exceptionally eminent. & Co was created, and I have been fortunate to be running this business successfully since 2001. As part of our commitment to provide luxury Is there any piece or special brand in your store that deserves spe- products and exceptional services, we have long-lasting partnerships with cial attention? Why? many leading designers from abroad that share the same ethos with us, pro- All of the brands have a story to tell, a concept to be inspired by, and viding the necessary elements that determine a modern and quality lifestyle. a lifestyle to be relished. Which brands do you represent? How do you view this sector in Cyprus? How does it compare We represent famous Italian brands that are pioneers in the luxury living with that of other European countries? sector such as Frigerio, Ivano Redaelli, Sangiacomo, Elmar, Riva, Frag, Since beginning, we have introduced many international brands to Vittoria Frigerio, Milano Bedding, Infiniti, Cutipol, Adriani e Rossi, the Cyprus market and we aim to continue driving design forward by Rosenthal, Effeti, Riflessi, Miniforms, MUSA, Talenti, Pierantonio Bonaci- showcasing the very best design houses in a relaxed, informal environ- na, Jesse, Riva1920, Mogg, Ochre, Penta, Melogranoblu, and more. All ment where clients can feel happy and peaceful. In our country, the are carefully selected to inspire a sense of contemporary design and luxury design sector in general is on a pleasantly growing path and one can living. easily see that buying behaviour is changing. But the pursuit of stand- ing out and being distinguished by the quality you offer will always How do you select which pieces and brands will be part of your store? be a constant factor, no matter where you are in the world. Contemporary and minimalistic lines, clean details and elegance have always been a sort of guiding light. Over the years, we have established re- What are your short and long-term plans? lationships of trust with our clients. Being by their side, we share their cre- Our philosophy has always been to deliver the very best in style, qual- ity and service to a long list of clients, something that has contributed to our international rise and reputation. ALL OF THE BRANDS HAVE A Do you have some tips for those who are now starting the decora- STORY TO TELL, A CONCEPT tion of their home? I believe ‘less is more’. And to be alert and observant. Think about TO BE INSPIRED BY, AND A your wished-for living environment, visualise the spaces and share LIFESTYLE TO BE RELISHED your needs and wants with a professional. Consequently, the mental picture you painted will guide you to make it a reality.

A Timeless Quality

O B J E C T S O F D E S I R E | 105 | Elias Ergatoudes, owner of Essere, reveals the secret of his store’s success as the exclusive furniture and homeware boutique in Nicosia continues to offer top-quality design choices to discerning clients after almost three decades of business. How long has your boutique been around? What EVERY ITEM AND EVERY made you decide to enter this sector? COMPANY WE HAVE Essere opened its doors in 1993. A passion for design IN OUR SHOWROOM and the awareness that it was lacking at the time was the deciding factor. Thirty years later, we are happy REPRESENTS A SMALL STORY that we took the risk. TO Which brands do you represent? REPRESENT For the last 30 years, we have represented top brands like Molteni&C, HIGH-END Giorgetti, Zanotta, Paola Lenti, Living Divani, Emmemobili, Glas Ita- BRANDS YOU lia, Tribù, Bonaldo, Saba Italia, Zimmer + Rohde, Glamora and Yo2 MUST BE AN among others. ABSOLUTE PROFESSIONAL How do you select which pieces and brands will be part of your store? Every year we go through a vigorous and exhausting selection process for the items we will display in our showroom. The furniture mix, as well as the colour palette, “obeys” the general concept for the season. Gen- eral trends do change from time to time; however, we always prefer to present designs that have a timeless quality, while at the same time incor- porating new materials and techniques, that stem from our companies’ extensive Research & Development activities. What are your favourite picks at the moment? During these perilous times, we must err on the side of caution, especial- ly in this current inflationary climate. Materials that don’t have a high production cost and, at the same time, are carbon neutral like wood, will continue to play a major role in our industry. Is there any piece or special brand in your store that deserves special What are your short and long-term plans? attention? Why? The short-term plan is to adjust as best we can to this increasingly un- Every item and every company we have in our showroom represents a stable economic environment. The long-term plan is always the same: small story you are trying to tell. Each of them holds a special place in to continue evolving our brand and offering the market high-end service our hearts. and products. How do you view this sector in Cyprus? How does it compare with Do you have some tips for those who are now starting the decora- that of other European countries? tion of their home? We live in a small country, and this creates all sorts of irregularities. Always have your budget in mind. There is no rush, you don’t have to However, one thing that remains the same, in any country, is that to buy everything at once. The best-looking homes are the ones that are represent high-end brands you must be an absolute professional. Any- furnished over time. Look for the best value for your budget. The Inter- thing short of that and you will be a shooting star that lasts a couple of net is a great friend of design, as you can get countless ideas. Once you years. This is a marathon, not a sprint. have finished doing all these things, pay us a visit at Essere!

| 106 | T R U S T S PUTTING THE Estate planning is not only about building RIGHT MONEY a portfolio or organising what happens to IN THE RIGHT your assets after your death. While that HANDS AT THE may be part of the issue, it’s mainly about ensuring a smooth transition of wealth RIGHT TIME from one generation to the next. Creating wealth requires vision, skill and By Georgia Constantinou-Panayiotou, Founding and entrepreneurship, not to mention a mixture of hard work, Managing Partner, Constantinou Panayiotou and good timing and luck. Retaining and protecting wealth also requires vision, along with a well-thought-out Trust and solid Co LLC – GCP LAW, Lawyer, Insolvency Practitioner, legal and professional advice. Member of Council of the Cyprus Bar Association There are so many complications involved in setting up a Trust that you must work with a lawyer who specializes in this complex legal area. To determine whether you need a Trust and, if so, which type you should establish, you should start by deciding exactly what you aim to achieve through a Trust. It can be set up to provide money for successive generations and earmark funds for certain family members, to preserve money which may otherwise be diluted or dispersed due to a divorce or a bankruptcy, to mitigate Income Tax, Capital Gains Tax or Inheritance Tax, to increase privacy or to avoid the delays surrounding probate. Trusts do not enjoy a separate legal personality as companies do. A Trust is the legal relationship between three key per- sons: The person transferring the legal title on the property is referred to as the Settlor, the legal owner of the asset is the Trustee, and the person receiving the asset and its benefits is the Beneficiary. THERE ARE MANY DIFFERENT KINDS OF PERSONAL TRUSTS BUT THEY ALL FALL INTO ONE OF TWO CATEGORIES: Inter vivos or Lifetime Trusts. These are created during the Settlor’s lifetime in order to transfer property to beneficiaries – typically family members and charities. These Trusts can be further categorized as revocable and irrevocable. Revocable Trusts can be changed or revoked during the Settlor’s lifetime and are generally for the primary benefit of the Settlor during that time. Irrevocable Trusts, on the other hand, generally cannot be changed or revoked. A will only comes into effect when a person passes away, but a revocable Trust established during your lifetime can also help your family if you become ill or unable to manage your assets. Testamentary Trusts. These don’t become effective until af- ter the Settlor dies. Typically, they are part of the Settlor’s last will and testament or arise under the terms of their revocable management Trust after the Settlor’s death. One of the most important decisions to make when setting up a personal Trust is who will be the Trustee. Your Trustee must be a strong, ‘trust’-worthy professional with independent judgment. Whoever

| 107 | A REVOCABLE TRUST ESTABLISHED DURING YOUR LIFETIME CAN ALSO HELP YOUR FAMILY IF YOU BECOME ILL OR UNABLE TO MANAGE YOUR ASSETS ONE MAY SAFELY CONCLUDE THAT CYPRUS IS AT THE FOREFRONT OF THE LEADING TRUST JURISDICTIONS AND AT THE CUTTING EDGE GLOBALLY is chosen must be fiscally astute. Furthermore, multiple Trustees can be 3. It allows the Settlor of a Trust to reserve powers to himself, designated to provide for the divergent interests to be represented. to retain a beneficial interest in trust property, or to act as the Cyprus is a hub for a significant number of High Net Worth Individu- protector or enforcer of the Trust, without any legal consequence als, whether residents on the island or not. It has a modern tax regime and on the validity of the Trust. an extensive network of double taxation avoidance treaties, allowing for effective tax planning. It has world-class professional and financial services 4. Cyprus International Trusts may be established with unlimited and a robust legal infrastructure founded on English Common Law. Ten years after the enactment of the International Trusts Law of 2012, I duration. believe that one may safely conclude that Cyprus is at the forefront of the leading Trust jurisdictions and at the cutting edge globally, with the most 5. It empowers Trustees to invest in movable and immovable favourable Trust regime in Europe, providing Settlors and Beneficiaries alike with the highest possible level of protection, assurance and flexibility. property both in Cyprus and overseas, including shares in companies incorporated in Cyprus. THE CYPRUS INTERNATIONAL TRUST IS DEFINED AS A TRUST IN RESPECT OF WHICH: 6. It provides for a uniform tax regime applicable to all persons on • the Settlor (whether a natural or legal person) is not a resident of Cy- the basis of a tax-residency test. In the case of a Beneficiary who is prus for the calendar year prior to the creation of the Trust; resident in Cyprus, the worldwide income and profits of the Trust • at least one of the Trustees is, during the whole duration of the Trust, a are subject to Cyprus tax. In the case of a non-resident Beneficiary, resident of Cyprus; and only income and profits earned from sources within Cyprus are • no Beneficiary (whether a natural or legal person) other than a charita- subject to Cyprus tax. Non-resident Beneficiaries will be subject to ble institution is a resident of Cyprus for the calendar year prior to the Cyprus taxation only on any Cyprus-source income. creation of the Trust. 7. Trustee services offered in Cyprus, may be offered only by OTHER ADVANTAGES OF THE CYPRUS INTERNATIONAL TRUST: 1. Asset protection. Trusts ring-fence the Settlor’s assets against any especially licensed fiduciary providers, i.e. licensed lawyers, accountants or CYSEC professionals. This offers extra professional claims. Unless the Court is satisfied that the Trust was made with the protection and assurance. intent to defraud persons who were creditors of the Settlor at the time when the payment or transfer of assets was made to the Trust, the Trust Life can be unpredictable. The world can be unpredictable. Creat- will not be void or voidable. The burden of proof of the Settlor’s intent ing a Trust allows you to adapt your estate plans accordingly. Great to defraud lies with the person seeking to set aside the transfer and any wealth can take many years to accumulate. The challenges to wealth court action must commence no later than two years after the assets were preservation are numerous, from ineligible beneficiaries, misman- transferred to the Trust. agement of assets and divorce to taxation and legal disputes. But with sound planning, these challenges can be mitigated, if not elim- 2. It establishes jurisdictional protection by providing that an International inated. By creating a Trust, you are putting in place a resilient plan to take care of your family and loved ones when you are no longer Trust containing a Choice-of-Law clause in favour of Cyprus law around or you lack the competence of being there yourself. Not is fully protected from unfounded foreign judicial claims as a matter of only can a Trust disentangle, clarify and facilitate asset distribution, public policy. it can also help you leave an enduring financial legacy.

| 108 | A D V E R T O R I A L A NEW MEANING OF LIFE AT SEA WITH TRIDECK he very quintessence of innovation, Azimut Yachts’ first ever Trideck Tsuperyacht defies the accepted norms of boat design to create extraordinary new spaces that redefine the concept of onboard living. With dimensions like never before and a design that breaks all the rules, the Grande Trideck is the magnifi- cent new Azimut Yachts flagship. THREE DECKS ++ONE Azimut Grande Trideck features a new living area never seen before on a yacht this size, the Sea View Terrace. The Sea View Terrace is an aft raised “mezzanine” deck, which is the latest addition to the traditional triple-decker. Thanks to this layout innovation, Grande Trideck offers four terraces: the sundeck, perfect for secluded sunbathing, then the up- per deck, where we find the main Outdoor Dining Area, next, the new Sea View Terrace, floating just a few meters above the water, and down below, the full-height beach area. Furthermore, one additional benefit of the aft raised “mezzanine” deck is the creation a Private Patio at the entrance to the salon, perfect to enjoy a complete privacy.

FOUR TERRACES REINVENT THE | 109 | WONDER OF LIFE AT SEA THE STYLE IS Azimut Grande Trideck features a new living area never seen before STREAMLINED, on a yacht this size, the Sea View Terrace. The Sea View Terrace is an aft raised “mezzanine” deck, which is the latest addition to the FAVORS traditional triple-decker. THE PURITY The innovative layout creates four terraces and a covered patio: the sundeck , perfect for secluded sunbathing, then the upper deck, AND home to the main Outdoor Dining Area, next, the stunning new CLEANLINESS Sea View Terrace, suspended tantalizing above the water, and down OF THE LINE below, a full-height Beach Club area at sea level. The introduction of the mezzanine creates space for an intimate sheltered Private Patio AND AT THE nestled between the Sea View terrace and salon. SAME TIME ENHANCES HERITAGE AND CRAFTMANSHIP THE The interior design by Achille Salvagni reimagines the use of inte- PERCEPTION rior spaces, leaving behind the traditional subdivisions to accom- OF AN EVER modate a more natural way of experiencing life onboard. The style is streamlined, favors the purity and cleanliness of the line and at HIGHER the same time enhances the perception of an ever higher quality. QUALITY OFFICIAL DEALER Tel: (+357) 24639600 (+357) 99626993 e-mail: [email protected] Website: www.bpyachting.com Locations: Limassol, Larnaca, Ayia Napa, Beirut

| 110 | I N T E R V I E W Emotional Connections Klitos Teklos, Senior Vice President, Global Creative Director at Estée Lauder Companies for ORIGINS/ADF/ LAB SERIES, talks about the concrete jungle that made his dreams come true, aesthetics, and the importance of being ahead of your time.

| 111 | New York is, without doubt, one of the them. As I define the creative universe for multiple brands, I tend to most dynamic and diverse cities in the draw inspiration and influences from what I’m working on. It’s very world and a cultural hub celebrated by much like acting; you have to get into the headspace of the brand and many generations of artists. Entranced its possible audience. It’s very important, however, to leave your per- by those big city lights, Klitos Teklos sonal taste to one side. If you are telling someone else’s story, it’s es- let the audacity of his youth guide him sential to create content that drives their authentic voice, not yours.” there, despite the fact that he had only Teklos’ globetrotting infuses him with inspiration. He has travelled ever seen it in films and magazines. extensively in the US, Latin America, Europe and Asia and has thus There was not the slightest doubt in his been exposed to multiple cultures and most importantly, cultural mind that he was doing the right thing nuances. “Other sources of inspiration for me are films, music and when he applied to study at the Pratt Institute in New York. architecture – there’s truly beauty and interest in everything,” he says. Teklos was lucky to experience both analogue and digital culture “You just have to be open and present.” when growing up, something that would ultimately shape his per- We are currently navigating very tumultuous times and observing ception and affect his creative persona. “The biggest contributing how many social anxieties are making their way onto sociopolitical factor in shaping me as a Creative Director was the duality of my agendas: sustainability, climate change, women’s rights, body posi- upbringing: having an analogue childhood and a digital adulthood. tivity, the underrepresentation of people with disabilities and many The analogue part was all in Cyprus and, since computers were not a more. I am eager to know how these issues affect Teklos’ brand phi- thing at the time, I was exposed to nature, to losophy. life experiences and human connections that “Art and commerce have always reflected were real, simple and tangible,” he reminisces the times we live in, from early paintings and adds. “The digital part was the chapter that and sculptures to current social media came with my studies and made technology A creative posts,” he begins. “The people that go and the world we live in today feel native and through these eco-socio-political anxieties, progressive. Being able to tap into both uni- director uncertainties and social awakenings are the verses has given me an incredible advantage, same people that are asked to like images a unique lens and a level of open-mindedness and buy products. So companies, brands that I truly value. It gave me imagination, cu- is a and, subsequently, campaigns need to con- riosity, empathy, awareness and adaptability, stantly evolve and reflect what’s happening. which are all needed to build a better founda- They must do it because they are respon- tion and instinct for communication. I work in sible for positive change through their storytelleran industry where you not only need to keep platforms and messaging. I have personally up with the times, but you also need to be the made sustainability, equality, identity, first and the best at it, so you have to nourish inclusion and diversity a big part of my that special skill that distinguishes you from mission at the company. I have maximized everybody else.”  In our sustainability in packaging across all 11 of When I ask Teklos to explain to me his mis- my brands with great success and within a sion, I am taken by the romanticism and ten- business, very short amount of time. We have imple- derness of his words. He reveals a true artistic, mented initiatives and partnerships to help altruistic nature; that of a man who has a duty the greatest the environment by sourcing ingredients to art and society first and puts himself last. “A challenge is responsibly, and by reducing waste and creative director is a storyteller – someone who material. I’m reflecting respect and rep- is able to combine artistic disciplines seamless- to resentation for all people, not only through ly in order to convey messages and emotions, my teams but also through my campaigns. create trends and desires, and transport the continuously I take very seriously that, with this kind of mind and senses,” he explains. “In order to power and influence, we must do our part do this successfully and at a global level, you be ahead in order to make the world a more positive, need to have exposure to the world, people and of your time accepting and caring place. And this must culture. You cannot communicate and sell an be done in a true and authentic way, other- idea, object or service to people, if you don’t wise consumers can see right through it.” have a way of understanding or connecting to At this point, I recall countless ads and cam-

| 112 | I N T E R V I E W paigns fronted by well-known celebrities There’s but that was back in the day when maga- and I am itching to ask about the im- truly zines were the only source of fashion and portance of celebrity endorsement of his beauty beauty information,” he explains. own brand campaigns. In reply, Teklos and interest “As technology has allowed unlimited is quick to clarify that, while a celebrity in everything. and oversaturated outlets of content, one face can fast-track awareness, it can only You just face – albeit a famous one – might not do so if the timing is right and the face have to be be enough. Today, consumers are not is relevant and embodies a certain vibe open and only savvy but they also have a very short and value that works for the brand in present attention span. A campaign needs to question. “It used to be that a celebrity stand out and connect emotionally with could make a brand or a product iconic them at an even greater level, in order to

| 113 | The lockdown forced us to re-envision fragrance and skincare through a digital lens make them not only remember it but also On the contrary, he discovered that remote trigger a purchase.” work can be effective, productive and flexi- Klitos Teklos has collaborated with count- ble, opening possibilities for people to have less brands across many industries and he choices, a better work/life balance and for cherishes every step he has taken in his ca- all businesses to have more humanity in reer and everyone he has come across who their approach and reinvent their creativity. believed in his potential. As he notes, each “The lockdown forced us to re-envision fra- moment was another milestone on the road grance and skincare through a digital lens. to where he is today, helping him establish Products that are highly sensorial and are himself as a force in the industry, an in- meant to be experienced through scent and dustry where, he says, you are only as good touch had to work a lot harder with their as your last project, so you have to outdo visuals, design and storytelling to make yourself every time. “The greatest challenge up for the lack of being able to see and try is to continuously be ahead of your time. A them in person. We made an impressive new fragrance takes about two years from pivot to cater to this, as self-care skyrocket- concept to shelf. That means it needs to ed during the pandemic and we needed to resonate with people two years after you’ve make sure we met demand and delivered come up with it. But things change so exceptional work based on this new set of quickly, people change habits, likes and parameters,” he recalls. “At my end, I made dislikes a lot faster than ever before. Our sure that our work was not simply reactive attention span is super-short, the world is but properly conceptualized, well-thought oversaturated and has gone through men- out and custom-designed for all digital plat- tal and physical fatigue. So the concept forms without losing its essence. I do like of being able to disrupt, stand out and the fact that we found ways to use our work drive interest is on a whole other level,” he and products to make people feel good and warns. “Cultural and regional nuances are enable their self-confidence and spirit, de- also increasingly challenging as one thing spite the hard times.”  might work in the US but will not nec- As human beings, of all ages and genders, essarily work in China, so you have to be we have one thing in common; we are well-versed in protecting the global image emotional creatures. We connect with one of a brand, while making sure it resonates another through stories and emotions, we at a local level. It all goes back to being carry them when we are uprooted from open, present and alert – it allows you to somewhere, cherish them when we believe be nimble, think on your feet and make the in or choose to fight for something. If there necessary changes, depending on whatever is one thing that Klitos Teklos is constantly the universe throws your way.” proving, it is that stories bring us together Indeed, when the COVID-19 pandemic and give us a once-in-a-lifetime chance to was thrown Teklos’ way, he did not cower. carry a message around the world.  

| 114 | T R U S T S GENERATIONAL Generational planning is the process of put- PLANNING: ting in place the arrangements to ensure that a person’s assets are passed in the man- CYPRUS WILLS ner desired to that person’s family and oth- AND TRUSTS ers. Whilst the figures range from country to country, it is probably a fair estimate that at least half of By Stelios Christophides, any European country’s population dies without leaving a Senior Lawyer, will. In many cases, this does not present an issue, where the laws that apply to a person who dies without leaving a will George Z. Georgiou (intestate) may result in that person’s assets being passed to And Associates LLC the very persons (usually his immediate family) and in such proportions as he would wish. However, it is also true that, in many cases, the application of the intestacy laws can result in an outcome that was neither envisaged by – nor would it be deemed suitable in the eyes of – the deceased. Typically, intestacy laws provide that the assets of the deceased pass to his spouse and children in specified proportions. When the deceased has no spouse or children, the assets might, according to intestacy law, instead pass to his nearest living relatives. In what situations would the outcome on the ap- plication of intestacy law not be appropriate? Consider the following scenario: V is 60 years old and widowed. With his wife, who passed away 3 years earlier, V has 3 children, X, Y and Z. X is aged 25, Y is 20 and Z is 14. V has accrued significant assets totalling €6 million. V is the sole owner of all those assets. Whilst X is a very responsible person who works diligently and takes his personal and professional responsibilities seri- IN MANY CASES, THE APPLICATION OF THE INTESTACY LAWS CAN RESULT IN AN OUTCOME THAT WAS NEITHER ENVISAGED BY – NOR WOULD IT BE DEEMED SUITABLE IN THE EYES OF – THE DECEASED

| 115 | TYPICALLY, INTESTACY LAWS PROVIDE THAT THE ASSETS OF THE DECEASED PASS TO HIS SPOUSE AND CHILDREN IN SPECIFIED PROPORTIONS ously, Y is considered by his father to be immature and irrespon- to pass directly to his three children – still not ideal as Y would sible – he seems to have become involved with the ‘wrong crowd’ still immediately receive assets worth €1.5 million (i.e. 1/3 of the and tends to fritter his money away unwisely and seldom plans for 75%). the future. Z is still in full-time education and is a conscientious student. Such a family dynamic is by no means uncommon and HOWEVER, IF V HAD SETTLED A CYPRUS TRUST DURING HIS LIFETIME, variations on this theme are commonly encountered when advising HE COULD HAVE LEGITIMATELY TRANSFERRED UP TO ALL OF HIS families looking to put a generational plan in place. So, what if V ASSETS INTO THE TRUST AND SET OUT THE PRECISE TERMS ON WHICH has no will or other generation planning tool? To understand why EACH OF HIS CHILDREN WAS TO BENEFIT, IF AT ALL, FROM THESE death without having left a valid will may be problematic, one TRUST ASSETS. FOR EXAMPLE, HE MIGHT HAVE PROVIDED THAT: needs to consider the outcome upon the application on the law of intestacy. • X, being the sensible sort, could receive an immediate payment Who inherits his assets when he dies, in what proportion and from the Trustee of, say, €500,000. Additional payments could when? In Cyprus, the law provides for what is commonly called be made to X as and when the Trustee deemed appropriate or, al- ‘forced heirship’, by which, on death, a person must leave a certain ternatively, the Trust could provide that amounts be paid to X at portion of his assets to his family and in the proportions prescribed specified periods. by the law (irrespective of whether he died leaving a will or not • Y should only receive payments from the Trustee if the Trustee and irrespective of whether his will stipulates otherwise). So, V has was satisfied that such payments were to be used in a useful man- died without leaving a will and the Cyprus intestacy law applies. Its ner. The terms of the Trust could provide for this by, for example, forced heirship provisions require that where a person dies: requiring that Y produce a business plan if he was to request funds • leaving a spouse and child(ren) or no spouse but child(ren): No for setting himself up in business. The Trustee could then evaluate more than 25% of the estate may be freely disposed of. The re- the business plan and decide, at his discretion, if it would be appro- maining 75% of the estate goes to the spouse/children. priate to use Trust assets to fund that venture. Any other payments • leaving a spouse only: No more than 50% of the estate may be out of the Trust could be stipulated in the Trust Deed as only freely disposed of. The remaining 50% of the estate goes to the being made when the Trustee was satisfied that they would not be spouse. used for wasteful purposes (e.g. gambled away or spent on friends taking advantage of him and spending his new-found wealth in a Therefore, V could only have freely dictated the terms of inher- wasteful manner). itance of 25% of his estate even if he had left a will. If V died • Z could benefit by Trust assets being applied by the Trustee to without a will, his entire estate would be passed directly to his three pay for his/her schooling and further education and living costs children in equal proportions (the portion reserved for Z, a minor, if choosing to complete studies abroad. Once Z became of adult would instead be held and applied for his/her benefit by the legal age, the Trustee could decide how to apply Trust funds for his/her guardian). In other words, the irresponsible and wasteful son, Y, benefit, depending on her circumstances and how he/she had devel- now immediately inherits a significant amount of assets (value €2 oped into adulthood. million) to do with as he pleases – not the situation V would have ever wished for and, in his eyes, a recipe for disaster. If V had left a The Trust terms could also allow for additional beneficiaries, for will then he could have freely dictated the terms of inheritance in example on the birth of any of V’s grandchildren and terms on how relation to 25% of his estate and the 75% of his estate would have such persons may benefit could also be stipulated in the Trust Deed or even left to the complete discretion of the Trustee.

| 116 | I N T E R V I E W LIVING THE DREAM Cyprus and L.A. are 7,364 miles apart. How did you end up there in the quest to realise your George Kallis is a man who fell irrevocably, madly, deeply in love… with dream? music. He allowed it to engulf him and give birth to his artistic persona, It’s been quite a journey around the globe! After fin- and it ultimately led him to Los Angeles, where he is now working as ishing my national guard service, I moved to Boston a composer on successful movies, collaborating with major directors to study at Berklee College of Music and then returned to London and production companies. He keeps shooting for the moon and never to complete my master’s degree at the Royal College of Music. I seems to miss. Here, he talks about the milestones in his career, the found employment there as a composer’s assistant almost immedi- Cyprus music/cinema industry and his own plans. ately after graduation, which led to my first film score engagements a few years later. In 2013, my wife and I decided to move to Los Angeles and I was offered a green card for extraordinary ability in the arts. This looked like the right option, since a lot of my work had started coming from L.A. and work-wise this also suited my wife also who is a post-production supervisor. Plus, we got to move to a sunny city with an entertainment industry focus, so it is work- ing out great for us. 

| 117 | When did you start composing, and what or who were your early pas- What does success and failure mean to you? Are these concepts firmly sions and influences?  linked to box office receipts and billboard rankings? Growing up in Cyprus, my family was a big influence. I started studying Today, I received literally the loveliest social media message “Your music the piano at around 7-8 years and the violin a little later but, at 13, I de- makes me feel better”. Surely, fanbase appreciation is the ultimate reward cided that I wanted nothing to do with music! I recall sitting at the piano, for any artist and, of course, if it comes with box office success, that is the upset because my piano skills were so limited and I couldn’t improvise as full circle! But it is not all fun and games. Working in the film business and, freely as I wanted. Sometime later, with the support of my drama teachers particularly, with other artists and creatives can lead to differences of opin- at The English School, I was given the opportunity to compose music and ion, hard deadlines and very little sleep. As a composer, I am part of a large songs for the school plays. Writing for theatre allowed me to be freely cre- team that consists of a director, editor, sound designer, producers, etc., and ative, so I found my love for music again. At 16 I submitted my first song we all come together for the best outcome of the film. But, to be perfectly to the national songwriting competition sponsored by Laiki Bank and I honest, I count my blessings that I can make a living doing what I love. won second prize. This gave me the confidence to write more and led to   a national prize in the Cyprus Folk Writing Competition with the song How would you describe the cinema/music industry in Cyprus?  Porizin and, a few years later, representing Cyprus at the Eurovision Song From an artistic perspective, Cypriots are massively talented as people and Contest in 1999. The rest of my career has been mostly focused on scoring we have a collection of innovative filmmakers and musicians. I think that, for the visual media, which includes film/TV scoring and music for trailers from a business and organizational perspective, there have been some great and advertising. My music influences ranged from Greek composers such things happening over the last few years, with a good competitive tax rebate as Hadjidakis and Theodorakis to film composers like Miklόs Rόzsa, Van- offered and productions from abroad are starting to take interest. So, my gelis, Basil Poledouris and Jerry Goldsmith, to name a few. As a teenager, hope is that, with new films being shot in Cyprus, the local crews are gain- I shifted into listening to heavy metal, following groups such as Black Sab- ing the training and experience that will allow them to handle more and bath, Iron Maiden and Metallica, bands that I still listen to today!  bigger films in the near future. During the pandemic, artists were the first ones to be cut from various budgets. Ironically, this should not have been You’ve worked with Disney, you won a Jerry Goldsmith Award for happening since people need entertainment even more during difficult Best Music for a Feature Film (for The Last Warrior), you recently times. I think that more effort from government bodies is needed to pro- completed the score for First Love, a film starring Diane Kruger and mote film and music and to support artists locally, as well as to help them Hero Fiennes Tiffin, which is due for release this summer and you’ve lift their careers further internationally. also worked for the popular After film franchise. What do you person-   ally consider to be the landmarks in your career? What are your main compositional challenges at this time? The big first step was meeting the prolific music supervisor Graham I am working on a quite few things as I am preparing to fly to Cyprus for Walker who, after hearing my demo, really believed in my music and rec- five weeks to spend time with my family. I am taking my work with me ommended me for the first two films, Joy Division (Momentum Pictures) on a mobile music studio which I am currently setting up! There’s nothing and Highlander: The Source (Lionsgate). I still had to put the work in, to like scoring Hollywood films in Protaras! Work-wise, I’ve just signed a receive the trust of the directors and producers but recommendations are all publishing deal with BMG/Luminary for some of my film music tracks. I we have in our industry. So, conducting a 90-piece orchestra for both films am also working on two films. One is another Voltage Pictures production, was a dream come true. There have been a few other landmarks over the which I cannot yet reveal details about. The other is called The Rage and years but a more recent one was working with Academy Award-winning is a survival thriller, produced by Ukrainian producers and shot in Russia. producer Nicolas Chartier (The Hurt Locker). Once I had started working Under the current circumstances, this was a difficult business deal to begin with director Castille Landon on the After series of films, I was told that he with but we have finally moved ahead. The film is fantastic and is directed was the executive producer. A week after I delivered the score for After Ever by Dmitriy Dyachenko – we worked together on all the Disney The Last Happy, I received a call from him. He explained how everyone was thrilled Warrior films. The music consists of manipulated sound design elements; with my scores and he wanted to recommend me to compose the music for example, taking organic recordings like flute recorders or orchestral for First Love. So, I am very happy that this introduction has led to a solid solos and filtering them through various plug-ins to create a unique and long-term collaboration, since we will be working on a new film together distinctive sound. Further to this, I have licensed some music for The Black soon. Phone and Black Adam trailers. The relationship between music and other forms of art – such as video MUSIC IS SO POWERFUL art and cinema – has become increasingly important. How do you see THAT IT CAN BRING this relationship yourself and how far does music relate to other senses than hearing alone? IMMEDIATE IDENTIFICATION Composers are also filmmakers, and the most successful music creators are OR REMEMBRANCE FOR particularly sensitive to dramatic story. We are not simply writing a piece NEARLY ANYTHING IT for an action scene or a love scene. There is an arc that a composer needs GETS ATTACHED TO to follow in order to help the characters and the story come to life. Music is so powerful that it can bring immediate identification or remembrance for nearly anything it gets attached to. For example, Jaws would probably not be as terrifying and iconic without that “dun dundun dun…” motif by John Williams. But music can be extremely therapeutic, and serve as inter- vention to accomplish physiological and neurological transformations too.

| 118 | R E A L E S T A T E HOW TO Home listings are one of the most no- BUY PROPERTY ticeable ways in which cryptocurrency IN CYPRUS WITH is being used in real estate and it is a CRYPTOCURRENCY strategy that is being used more and more to generate greater interest in the By Savvas Savvides – Lawyer, Partner, real estate market. Michael Kyprianou And Co LLC Given the growing popularity of cryptocurrency in Cyprus, purchasing real estate using cryp- tocurrency is a viable option in the current atmosphere. Developers are already offering properties for sale in bitcoin, which is becoming more common. It is now a reality that the global trend for cryptocurrency is growing, and the number of people willing to conduct transactions in crypto, or digital money, is growing too. There is also the option to convert cryptocurrency into fiat money for individuals who prefer to accept payment in the traditional manner using euros or other currencies. The purchase and sale of real estate is carried out as a standard transaction which appears as indicated below: • The buyer collects all the papers required for the purchase of the property; • The lawyer progresses with all due diligence processes nec- essary to check the legal status of the property to make certain that it is free from any charges and/or encumbrances; • An agreement is concluded between the purchaser and the seller in which the seller’s crypto exchange account is indicat- ed in the agreement; • The buyer transfers bitcoin or another type of cryptocur- rency through a system of smart contracts which operate on a legal level in the EU; • The seller receives a confirmation receipt; • The deal is fixed; and • The record of the change of owner is registered with the au- thorities, such as the Land Registry Office, etc. An immediate question that arises, is to how to convert the cryptocurrency into cash or the local currency if the seller does not wish to keep cryptocurrency. This can be achieved in various ways, even if you hold on to your bitcoins or other cryptocurrencies and sell them after several years. THE TRANSFER OF CRYPTO BETWEEN WALLETS OR ACCOUNTS THAT YOU OWN IS NOT TAXABLE

| 119 | SINCE THE EU DIRECTIVES HAVE BEEN IMPLEMENTED, TRADING WITH CRYPTOCURRENCIES IN CYPRUS IS LEGALLY PERMITTED Alternatively, if you do not wish to do this you can convert them Portugal, Switzerland (known for its incredible banking standards) into cash as below: and Germany. • Use a cryptocurrency exchange. Some platforms allow users to sell In Cyprus, the Prevention and Suppression of Money Laundering their bitcoins or other cryptocurrencies to other users. For example, and Terrorist Financing Law L188 (I)/2007, (the AML Law) was you can exchange your bitcoins for euros, US dollars or any other amended through the L13 (I)/2021 (the Amending Law) to harmo- fiat currency; nize domestic legislation with the provisions of the 4th and the 5th • Use Peer to Peer (P2P) exchanges that allow for the purchase and AML Directives (Directives (EU) 2015/849 and 2018/843). sale of cryptocurrency online, which means you can deal with them personally. However, if you choose to use this type of platform, you The 5th AML Directive made several amendments to the 4th AML need to ensure your safety/security; Directive (together the AML Directives) effectively extending AML/ • Use a cryptocurrency ATM. You can use a cryptocurrency ATM CTF controls to the following: to obtain physical cash. At present, cryptocurrency ATMs operate • Providers of exchange services between virtual currencies and fiat in over 76 countries and, consequently, it is becoming easier. How- currencies (Exchange Providers); and ever, bear in mind that not every cryptocurrency ATM allows you • Providers of custody services for virtual currencies (Custody Pro- to sell for local currency. In addition, ATMs have different buy and viders). sell units, supported coins and fees; • Use a cryptocurrency debit card. While such a card may not pro- As a result of the amendments introduced by the 5th AML Direc- vide for the conversion of cryptocurrencies into cash, it does provide tive, EU Member States are required to ensure that Exchange Pro- a way to then spend your cryptocurrency. It works like a regular viders and Custody Providers are registered, and the persons holding debit card and you can buy services and products online and offline. management functions or who are the beneficiary owners of provid- You can also withdraw cash from any ATM. ers are fit and proper. In Cyprus, the Cyprus Security and Exchange Commission (CySEC) has been designated as the competent super- When it comes to the question of whether or not cryptocurrency visory authority for matters relating to crypto asset regulations and is taxable in Cyprus and whether you have to pay taxes when con- has been provided with powers to regulate through directives. Since verting cryptocurrency, it seems that Cyprus is in a more privileged the EU Directives have been implemented, trading with cryptocur- position than other European countries. The reason is that funds rencies in Cyprus is legally permitted. It is, therefore, safe to say that deriving from Initial Coin Offerings (ICOs) are subject to taxes trading with cryptocurrencies in Cyprus is conducted according to in Cyprus since they are deemed to be taxable income. However, the rules of general Civil Law. Cyprus has one of the lowest and most attractive corporate tax rates Cryptocurrencies are a new trend that can easily be implemented at 12.5% and this is its greatest advantage in comparison with any in property transactions and it is becoming increasingly popular another European country. The transfer of crypto between wallets around the world. The property market has had to adapt so that or accounts that you own is not taxable. You can transfer your own sales can also be made with cryptocurrency. One of the most im- original cost base and dates by accruing and tracking your potential portant pillars of the country’s economy, which will continue to be tax impact when you eventually sell. considered as such, is the purchase and sale of properties. Conse- Comparing Cyprus with Malta, the latter is popularly known as quently, this adaptation was required and necessary. The most im- a ‘blockchain island’ since it does not impose capital gains tax on portant point to remember when investing in cryptocurrencies is to cryptocurrencies that have been held for a long time. There are, of consider your risk. You should also not forget to calculate the taxes course, many other crypto-friendly countries in the world, including and fees that you will need to pay in order to take a wise financial decision.

| 120 | W O R K / L I F E B A L A N C E

| 121 | Power W Couple as it difficult at first to combine two careers and two lives on one single path? Sharing Charalambos Prountzos: When we met in 2008, we were already both busy people, with our careers a Single going well. Our drive and ambition to be good at what we do and to succeed was something that we Path had in common. However, most important was our Gogo Alexandrinou, mutual belief that ethics should always prevail in Public Affairs our professional lives. This fundamental value has Advisor, Red Wolf PR guided us both throughout our professional careers. & Advertising Agency For the first couple of years, combining our personal and Charalambos and professional life was easy. However, in 2009 our Prountzos, Managing first daughter, Maria, came along and obviously this Partner, Prountzos changed our lives. At that point, I took the most & Prountzos LLC/ critical decision in my professional career: to start EY Law, Law Leader my own law firm. Actually, it was a decision that we CESA Region at EY, took together, despite the risks that came with it. reveal how they We felt that, if I didn’t make the move then, there keep their bond was a risk of leaning towards certainty instead of strong as they realising our full potential. We admire each other, balance challenging believe in each other and this has been a basic ele- careers with their ment of our relationship. parental duties and responsibilities. Have you always divided up household responsi- bilities? Photos by Gogo Alexandrinou: Over the years, we have sup- Michalis Kyprianou ported each other in critical career decisions and at certain junctures when one took on more responsi- bilities than the other. For instance, when I became the main TV news anchor on the state channel, CyBC, Charalambos gave me his full support. Then I supported him when he took over the Law Leader role for EY in the CESA Region, which entailed extensive travel abroad. And he did the same for me when I spent a full year setting up the first digital TV channel in Cyprus. We have had a lot of help from our families but the truth is that it has been ex- tremely difficult on many occasions to balance career and personal time as we are both perfectionists and fully committed.

THERE IS WE ADMIRE EACH OTHER, BELIEVE IN EQUALITY AND EACH OTHER AND THIS HAS BEEN A A UNITED FRONT BASIC ELEMENT OF OUR RELATIONSHIP AT HOME – – CHARALAMBOS Does the fact GOGO PROUNTZOS that you are ALEXANDRINOU both in a senior to feel able to share anything with us and speak openly about anything that comes to their minds. position make your Do you both understand the challenges of your partner’s marriage different from career? How important is it to support your partner’s career and feel that you are similarly supported? how it would have been if C.P.: To a very large extent, yes but even if we do not know the individual details, we understand that it is demanding and only one of you had such a sometimes has suffocating deadlines. For this reason, I find it important to show (and have) support as it removes extra stress role? from your partner. The stress of work is enough, there is no need to complain about the hours of absence, travelling, busi- C.P.: Possibly it does. Each couple has its own ness meetings outside working hours. G.A.: For me it is vital to have support from my partner. He is balance and codes of communication. There are a driving force but at the same time I consider him an objective and strict judge – so I trust him and I want his opinion! partners who feel comfortable with having a role in the How do you manage to make time for each other? background, focusing more on the family and the home and C.P.: With two kids and our demanding careers, it’s pretty hard but we work around it! Contemporary couples face challenges in that’s perfectly fine. For us, it was important to accept each finding time for one another. We have discovered a few ’strat- egies’ to spend more time together, such as having coffee early other as we were. And our careers were part of who we were in the morning after the kids go to school or arranging a ‘date’ when they are attending after-school activities. It might just be and what we wanted to be. It was never about money – that an hour but it’s the quality and not the quantity that counts. was also common between us. It was about doing the right Have you ever had to choose between accepting a new posi- tion and maintaining your home life? thing and doing it right. Now, we are both fine with the idea G.A.: Yes and it was not a difficult decision. My priority is my family and my kids. When I was younger, I had a different of stepping back at times to focus on our family and on each mindset and, in the past, I did sacrifice balance in the pursuit of a career. Now, I have taken a few steps back as I want to be fully other. We know it is an important period for our children and, present. for us, they are the top priority. But our children have shown great maturity and understanding and we are now prioritizing better than we did in the early years of our life together. Are your roles at home identical or do they complement each other? G.A.: There is equality and a united front at home. Charalam- bos is a big advocate of gender balance and diversity and his approach to family matters could not have been different. He wouldn’t be able to do differently with three opinionated la- dies in the house! I am usually more strict in terms of setting limits and ensuring that our children contribute to housework. Charalambos is, by nature, more calm and less strict but he always supports me when difficult conversations need to take place. However, when he gets serious, they both know they‘ve done something seriously wrong! We are both in favour of having a transparent relationship with our kids. We want them

| 123 | Art For Art’s Sake No matter how confusing and terrifying the times, we will always have – and need – art. This is its ultimate power and what makes works of art timelessly beautiful and essential. It is no exaggeration to state that galleries act as vessels of communication between the artists and the public; they are the beating heart of the world of art. On the following pages, four gallery owners discuss the importance of investing in art and enjoying it for its own sake. Photos by TASPHO And Michalis Kyprianou

| 124 | A R T Apocalypse Gallery, Nicosia “Art has always had an investment value”

| 125 | ‘S THE ARTS tionally. Art is always the first to feel WILL ALWAYS these shocks and be influenced either BE AFFECTED positively or negatively. I would say BY ECONOMIC that, where art is concerned, we ex- perienced a ‘golden age’ until 2010, as there was interest in – and love and demand for – art in general.” She goes on to explain that, in the international arena of luxury in- vestments and on the stock market, erendipity’ might be the best word to AND POLITICAL art has the potential to bring huge explain how Natasa Tofaridou became returns. “Art has always had an in- the Founder & Manager of Apocalypse TURBULENCE vestment value,” she admits candidly. Gallery, which started its operations in “Of course, as in any area of invest- 1987. AND ALL KINDS ment, the interested parties need “Art was always very close to my heart, to conduct their research diligently OF EVENTS although I studied at the Athens Uni- TAKING PLACE and not make random purchases. versity of Economics and Business,” As far as Cypriot contemporary art she reminisces before describing her is concerned, the work of the artists entrepreneurial journey as an adven- INTERNATIONALLY who defined the genre – Christo- ture. “Setting up this peculiar ‘job’ foros Savva, Adamantios Diamantis, was not exactly the easiest task. I spent Solomos Frangoulides, Michalis countless hours studying the work of Kashialos, Telemachos Kanthos, Cypriot painters, I learned about their Ioannis Kissonergis, Stass Paraskos, different techniques and styles and Lefteris Economou and others who then I started writing letters, inviting Don’t are no longer alive – certainly has them to take part in exhibitions. I also investment value. Of course, there are organized some solo exhibitions in forget living second-generation artists that Athens, mainly of Cypriot artists who one can invest in, too. When it comes were living there at the time.” that to younger artists, a collector should Tofaridou goes on to explain how she keep an eye on their development, art had set some unyielding principles for is their studies and their consistency in the gallery’s operation: she would stay the field. It is also important to note true to her promises, there would be that there are now important Greek consistency in payments and the gal- to be artists who have a strong presence on lery’s priority would be the promotion international art exchanges.” of high-quality exhibitions and artists. lived Tofaridou sets no red lines when it “Managing such a space is by no means comes to the style of the artists she easy,” she says. “It may seem so but it is works with. As she explains, quality not. First of all, the gallery space needs has no specific style and can be found to be sustainable and you are the one who needs to achieve this. You in figurative, conceptual or abstract art. “Of course, there are specific have to manage and make wise exhibition choices; you need to chase trends at various times which attract buyers and let’s not forget that and host events so that the space remains alive, relevant and open; the element of mimicry is always lurking. In the past, it was an ele- and finally, you have to be ready to deal with situations that affect ment that could determine sales. However, I believe that, especially the arts.” since the 2013 crisis, there has been a greater demand for contempo- Natasa Tofaridou is aware that art is, inescapably, a product of its rary works with a fluid style with abstract elements and image distor- time and the freedom of unfettered art can never be absolute, ei- tion.” ther due to socioeconomic or political reasons and restrictions. She Natasa Tofaridou is proud of Apocalypse Gallery’s artistic ride, closely observes developments on the Cypriot and international art which has continued for more than 30 years. “We have held unique scenes, always on the lookout for any gems that come her way. and beautiful exhibitions, we use history as our compass and move “As a sensitive sector, the arts will always be affected by economic into the new era with renewed power,” she says with great optimism. and political turbulence and all kinds of events taking place interna- “Don’t forget that art is to be lived.”

| 126 | AFRATM I L Y M A T T E R S

| 127 | Bluchip Gallery, Larnaca “The first rule of buying art: buy what you like!”have been a collector for most of my life. Having stud- ied Fine Art & Graphic Design, I have always had an eye for and a passion for art.” James Demetriou, owner and director of Bluchip Gal- lery, consciously chose to live a life in art. As a gallerist and a man who devoted his time to study the subject ‘Iof Art academically as well, he has engaged himself in their portfolio according to their specific taste, needs and budget. Demetriou is quick to outline the basic principles for investing in art and, unsurprisingly, what comes first is the individual’s personal spiritual hun- ger and the emotions evoked by the untranslatable works. “The first rule of buying art: buy what you like!” he says. “If the piece says something to you, inspires you in some way, or just brings back happy memories, then that’s the one for you. Always do your due diligence on any artist you are an endless artistic journey that continues to move up- interested in. There are many sites and auction houses that will show you wards and forwards through the operation of his own gallery. an artist’s track record regarding past sales and pricing. Speak to reputable “Bluchip gallery has been evolving since we opened our doors back in dealers and galleries. Provenance is key for current and future values.” 2018. From a stand-alone gallery, we are moving towards displaying our He is quick to add that art is an investment that can be enjoyed every sin- works for sale in other venues to give more people a chance to see the gle day. “You can freely choose how long a term you are looking to invest works in situ, such as in both Radisson Hotels and The Indigo Hotel in for. For example, you could invest in a blue-chip artist such as Banksy, Larnaca and, of course, in the QBlu Plaza where the gallery is currently where going by track records, you have a very good chance of making a situated,” he says and adds, “Managing and owning a gallery can be a chal- quick buck in the medium to short term but in the long term, too” he lenging and interesting occupation. Meeting people from all walks of life notes. “Or you may choose to go for an up-and-coming artist whose work who have a common love or passion – art, whether it be to beautify their is being sold by a reputable gallery at relatively low prices, giving you a homes and offices or as an investment. I enjoy the diversity. Art, for me, chance of making good on your investment, probably over a longer term. is the purest form of expression. As they say, ‘A picture paints a thousand The international art market is growing so there are many outlets ready words’.” to take your piece in and sell it for you, or you can go straight to auction Demetriou cherishes the unique relationship that he forms with each artist yourself. Artworks very rarely drop in value; art investments over the last through their collaboration. When art pulls people together, the connec- 10-15 years have outdone many others, with a steady longer-term yield tion is electric and lasts for life. “Seeing Bluchip’s international artists and and capital gain.” their work develop over the years and gaining worldwide recognition has Demetriou is totally in sync with developments around him; he sees been very rewarding. Even to be a tiny part of this makes you feel proud, change and adapts accordingly but he does not let it dictate his ways; he privileged and extremely happy for them,” he says affectionately. “It is marches to his own drum. “Since the rapid development of the Internet, very hard to choose favourites but, if I must, Remi Rough is one of them. the art market has been blown wide open!” he says. “Especially with the Watching his evolution from graffiti artist to more abstract contemporary latest NFT phenomena. You no longer need to go to a physical space or works has been a privilege. Another favourite piece is an auction house to see the artworks. Everything “Morons” by Banksy – I love the irony – and Matt can be done from your own private space. The Small’s “Patricia” will be dearly missed when she’s online market for art has been flourishing and ex- gone! Works by Faile, as well as Spanos’ amazing Provenance panding for years and many galleries and auction metal sculptures are also some of my favourite works is key for houses now exist purely online. Obviously, you in Bluchip.” can never replace being physically there in front of Bluchip Gallery primarily deals in world-renowned the piece, but it does come a close second with the urban contemporary artists that have an international current technology available today.” track record of consistent sales and international Demetriou’s future plans include free art tours of market value. The gallery has also been involved in and future all the works available on display, and the curation investing in new up-and-coming local artists and of more shows by both local and international introducing them to worldwide markets, as well as values artists, all part of his endeavour to convey the tan- offering art consultancy services, helping clients build gible and intangible value of art.

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| 129 | Golden Gallery by Kapatays, Nicosia ‘Investing in art “When to begin a collaboration and is a serious busi- investing promote an artist, the art should ness, given the serve his soul and the artist amounts spent in art, should also exude a similar aura. on art globally. there are “To begin a collaboration with Investors and col- an artist, I first have to aes- lectors must be thetically approve of the artist always cautious and find a liking for his or her and alert, since investing in art is art, otherwise it is impossible like investing in the stock exchange. definitely for me to exhibit their work. I There are definitely some golden look for a certain level of artistic rules to be followed,” says Andreas quality, both technically and Kapatays, owner of Golden Gallery some conceptually, the depth of their by Kapatays, and he elucidates: work, the meanings that their “Firstly, authenticity. The collector work wants to express, their must investigate with the help of a academic background and their trustworthy dealer, through muse- golden overall potential,” he enthuses. um listings or established galleries, “Equally important for me is the authenticity of the artwork, to to feel that there is a beautiful become familiar with the necessary rules to be chemistry between the artist and information, concerning provenance myself. Among my favourite and possible auction history. Anoth- artists, whose art is part of my er factor which must be taken into private collection, are Alekos account is the international career followed” Fassianos, Costas Tsoclis, Pav- of the artist, which applies to both los, Kostas Varotsos, Yiannis established and upcoming artists. Gaitis, George Lappas, Andreas Collaboration with the right gallerist Charalambides, Yiannis Stylia- is another key factor, since he or she nides and many more.” must be knowledgeable and aware of Kapatays considers technology the international art scene to be able to be a useful ally of many to spot the right artist and the right investment, at the right time, for each professionals, including those in the art sector. The online world, he says, customer.” offers a platform that enhances and helps exhibiting and promoting art to As he explains, given the fact that one has invested in high art, besides a greater audience, thus making art accessible to people who cannot visit a its aesthetic value, there is always the benefit of liquidity. “At any point, gallery or a museum. “However, when it comes to serious art collecting, I the artwork can be sold through galleries, auction houses or private sales, personally believe that a collector must have an ‘up close’ experience of the providing a substantial return, usually in the minimum time. The return artwork so that he or she can develop a personal and direct dialogue, for the percentage is around 10% every two years,” he explains. right decision to be taken,” he admits candidly. Kapatays’ journey in the fascinating world of art began when he was a Kapatays is a restless man and he does not place limits on where art can child. Surrounded by art lovers and exposed to the viv- get him. “Golden Gallery by Kapatays offers a idness of art and those who created it from very early high level of good investment art for all budgets, on, it was inevitable that he would delve into this in- quality services, including consulting and collec- dustry. “My grandfather was one of the first importers tion management, and above all, we aim to build and wholesalers of frames in Cyprus,” he explains. “So, Investing in interpersonal relationships with our customers,” he due to the family business, I had the chance to meet art- art is a serious says and adds. “Our goal is to promote culture and ists and grow fascinated with art from a very young age. satisfy all who those have supported our efforts in At 16 I purchased my first original artwork, now part of business, given the art world of Cyprus and abroad throughout the my private collection, from Cypriot artist Stelios Votsis the amounts years. Our future plans include the expansion of and, from then on, I developed a professional interest in our galleries locally and abroad, as we aim to con- this field.” spent on art tinue to offer to our audience high-level exhibitions Kapatays values the thrill he feels when he comes across globally and art.” a new work of art. After all, as he points out, in order

| 130 | AFRATM I L Y M A T T E R S Elena Christodoulides Melina Demetriou Anthi James Kalavanas Christoforou Alpha C.K. Art Gallery, Nicosia “Buying art is a personal and emotional decision”

| 131 | A lpha C.K. Art We trust market, as art is considered to be a valuable Gallery was our own alternative form of investment. “Art has long founded in 2013 aesthetic been viewed as an alternative asset class” and specializes appraisal Demetriou admits candidly. “It is a tangible in the curation, asset that is widely and easily accessible and promotion, and affordable. Fine art’s value can appreciate trade and valua- intuitive over time, the art market has less volatility tion of contem- reaction and fluctuation than other financial markets porary Greek and, in high inflationary periods, such as we and Cypriot fine to the are currently experiencing, it can be a good art. The four artwork, hedge against inflation. Art offers the value directors – Elena Christodoulides, James Christo- of personal enjoyment; it is an asset that can forou, Melina Demetriou and Anthi Kalavanas – are while be appreciated and displayed.” passionate about art, with academic credentials in trying to It can’t be denied that art does not exist the field, and many years of professional experience. appraise the independently of the social connections “We have curated, organized and presented hun- cultural in which it is embedded but extends into dreds of exhibitions, fine art auctions and charity the social realm, through its effect on so- art events,” says Kalavanas. “The Gallery currently and ciety and collective cultural identity. And represents over fifty Greek and Cypriot professional historical although the digital world’s domination is artists and its principals maintain professional and significance growing day by day, Christodoulides be- personal relations with many artists, curators, art crit- of artists lieves that the human transaction around art ics and historians, and other fine art professionals”. and their is not dead yet. Art speaks of the ultimate depths and working “While the pandemic confirmed that art with creative individuals is definitely not for the work buyers have a considerable willingness to faint-hearted. As Christodoulides explains, when purchase online, they still prefer to transact considering artists to represent, the team evalu- Art has with art dealers, and galleries continue to ates their academic qualifications and professional long been be their primary and most trusted source achievements such as exhibitions and placements for buying art. The best strategy for us, in collections, as well as a wide range of intangible viewed therefore, is to maintain a strong physical criteria, including the artist’s creative skill and imag- as an presence and develop strong digital sales ination, how inspiring and meaningful their art is, alternative and promotional channels,” she says and and the emotion it provokes. “We trust our own aes- asset class adds, “The two factors we feel will drive the thetic appraisal and intuitive reaction to the artwork, digitization of the art business in the coming while trying to appraise the cultural and historical years are the increasing influence of millen- significance of artists and their work,” she says. nials and the growing interest in crypto art “Buying art is a personal and emotional decision” and non-fungible tokens (NFTs).” adds Christoforou. “Even if investing in art is the Quality and uniqueness, authenticity and primary objective, you should buy an artwork that provenance, knowledge and transparency. you love and want to live with. Trust your personal These are the selling points and values that aesthetics,” he says in a passionate plea. “Buy quality guide the four directors as they seek to pre- and uniqueness; artists show their best art on the serve and safeguard the gallery’s status and biggest stages – museums, galleries, and art spaces. high level of quality and enable them to Study the artist and their work. Seek expert advice discover new talent with collectible signifi- and opinions. Consider pricing relative to the artist’s cance. “We will continue to showcase quali- career level, professional accomplishments, and pros- ty art, respect our clients, support our artists pects. Don’t ignore the potential risks and know that and care for our community,” Melina Dem- art is a long-term investment.” etriou says tenderly. “These principles have If we let the numbers do the talking, according to helped us build a successful gallery, earned the 2021 Art Basel & UBS Report, an estimated us a leading position in the market, given 167,349 Ultra High Net Worth Individuals around us the foundation to persist during difficult the world are important consumers in the luxury times and rewarded us with many successes.”

| 132 | I N V E S T M E N T REAL ESTATE AsLondon emerges from its OPPORTUNITIES: COVID-19-enforced hiberna- LONDON AS AN tion, we can now examine its INTERNATIONAL prospects as an international investment destination. Whilst INVESTMENT there are certainly headwinds DESTINATION that might dampen growth, London’s resilience, transparency and liquidity will ensure its con- By Marios Hajiroussos, tinued success in attracting international capital. CEO, Consulco Group Although forecasts for GDP growth are muted, the UK economy is likely to outperform the EU economy over the next two years. With more workers returning to their offices and visitor numbers picking up, London’s buzz has returned. Theatres are busy, res- taurants are full and hotels are charging premium rates in the face of high demand. In June, as the city and the country prepared to celebrate the Queen’s platinum jubilee, Regent Street and Oxford Street were bedecked with union flags, adding to the carnival feel. The hospitality sector was braced for its busiest period (over a four-day bank holiday) since pre-COVID-19 times. Infrastructure projects continue to enhance the city, moving Lon- don forward. In May this year, the long-awaited Elizabeth Line finally opened. This is a new underground railway line that will link Reading in the west with Heathrow, the West End, the City, Canary Wharf and suburban Essex in the east. Unlike the existing tube network, the Elizabeth Line benefits from full size carriag- es – with each train over 200m long. The line has dramatically improved connectivity across and through central London and brings a further 1.5 million people within 45 minutes of the central business zone. This project has already encouraged the construction of over 1,000,000 square feet of prime office accommodation around Paddington, Tottenham Court Road, and Farringdon – with more due to be completed this year. Despite recent tough times, punctuated by draconian lock- downs, values for prime commercial property have remained stable, demonstrating once again the city’s resilience in un- precedented times. After an initial sharp decline, values and rents for residential property have quickly recovered, both rising above their pre-COVID-19 levels. Although it may seem counter-intuitive, demand for office space – particularly from major occupiers – continues to sup- port rental values in prime locations. Companies need to offer their staff a high-quality working environment to tempt them back to the office, to retain staff and to attract new employees. This entails a modern office, with multiple amenities (such as showers and cycle racks), which meets/exceeds required levels of energy efficiency and is fit for the next 10 to 15 years. Despite the pandemic, the war in Ukraine and rising infla- tion, prime London residential property is set to enjoy five years of growth – both rental and capital. Furthermore, values for prime London offices and retail units are also forecast to

| 133 | LONG-TERM GLOBAL INVESTORS SEE LONDON’S POSITION BETWEEN ASIA AND THE US, ITS UNIVERSAL LANGUAGE AND ITS DIVORCE FROM THE EU AS POSITIVE ATTRIBUTES RESIDENTIAL SALES 5 YEAR SAVILLS FORECAST INCOME CAPITAL TOTAL PRICE GROWTH 2022 2023 2024 2025 2026 COMULATIVE ANNUALISED RETURNS RETURN RETURN RETURN FORECAST 2022-2026 Prime Central London 3.50% 6.00% 5.00% 3.00% 3.00% 22.21% Central London Retail 2.80% 3.90% 6.70% Prime Outer London 4.00% 3.00% 3.00% 2.50% 2.50% 15.92% 6.70% UK 5.50% 2.50% 2.00% 3.00% 3.00% 17.02% London Offices 4.00% 2.70% SOURCE: SAVILLS- UK CROSS SECTOR OUTLOOK - 2022 RESIDENTIAL SALES 5 YEAR EUROPEAN COMMISSION PRICE GROWTH 2026 COMULATIVE FORECAST 2022 2023 2024 2025 GDP GROWTH YOY 2021 2022 2023 2.30% 3.50% Prime Central London 8.00% 3.50% 3.50% 3.00% 3.00% 22.74% Cyprus 0.00% 2.70% 2.30% Prime Outer London 5.00% 3.50% 3.50% 3.00% 3.00% 19.33% EU 0.00% 4.10% 1.50% UK 4.00% 3.50% 3.00% 3.00% 2.50% 17.05% UK 0.00% SOURCE: KNIGHT FRANK: UK RESIDENTIAL FORECASTS - APRIL 2022 YE 2021 YE 2022 YE 2023 100.00 102.30 105.88 GDP GROWTH Cyprus 100.00 102.70 105.06 EU 100.00 104.10 105.66 Cyprus EU UK UK 107.00 YE 2021 YE 2022 YE 2023 which they believe will drive performance over the next 20 YE 2023 years. Not surprisingly then, sovereign wealth funds, insurance 106.00 GDP GROWTH companies and pension funds have all been active in the prop- 105.00 erty investment market over the past 12 months, maintaining 104.00 EU UK prime yields at their pre-pandemic levels. 103.00 Of course, London is not immune to the COVID-19 hang- 102.00 YE 2022 over of rising prices, staff shortages and resurgent inflation. It 101.00 is likely that interest rates will continue to rise as the Bank of 100.00 England attempts to tame the inflationary pressures and, for many residents, the cost-of-living crisis is real. The hospitality 106.00 YE 2021 sector and the building industry are already facing rising staff 105.00 costs and more expensive raw materials – and no doubt this trend will seep into other areas of the economy. We are not 104.00 complacent about this threat and our London Credit and 103.00 Property Investments Products have traditionally been good 102.00 hedges against inflation. 101.00 So, how can we protect our savings and take advantage of Lon- 100.00 don’s medium-term growth potential? As we look forward it is important to remember that London rise during 2022, with both providing income and capital growth. swiftly recovered from the 9/11 shock, the global financial Long-term global investors see London’s position between Asia and the US, crisis, political instability and the Brexit vote. We expect its its universal language and its divorce from the EU as positive attributes, resilience to ensure once again that it not only recovers from COVID-19 and Brexit but will continue as a leading interna- tional investment destination. As Cypriots living in a small country, it is natural to consider investing a proportion of our wealth abroad and London con- tinues to offer good medium- to long-term prospects. But, before you do so, please talk to our specialists who can deal with these tough questions and take the emotion out of invest- ing in property abroad.

| 134 | B U S I N E S S T A L K

the uk is here to help When the UK announced its intention to leave the EU in 2016, hardly a day went by without eminent media outlets predicting that the end was nigh: The UK would collapse under the weight of its financial isolation, while the EU would have to deal with a terrible precedent or see the most ambitious modern socio-political experiment fail monumentally. Of course, the doomsday scenarios did not come to pass. In May 2022, under the auspices of the British High Commissioner to Cyprus, members of the Cyprus- UK Business Association met with Her Majesty’s Trade Commissioner for Europe, Chris Barton CMG, to discuss the post-Brexit trade and investment climate between the two countries and examine future opportunities. APhotos by TASPHO bove the Nicosia residence of the outgoing British High Commissioner, Stephen Lillie CMG, graphite-grey clouds had gathered on an unseasonably windy day for the end of May to form a real English sky. The High Commissioner had agreed to host a meet- ing of minds between members of the Cy- prus-UK Business Association and Her Maj-

| 136 | B U S I N E S S T A L K esty’s Trade Commissioner for tea from Asia – caffeine being Europe, Chris Barton CMG. the most potent productivity Barton is only the third person drug – was the springboard of to be appointed to that specific the industrial revolution. post and, since 2021, his man- Back to 2022, where Chris date has been to work closely Barton was hailing the ben- with the country’s wider dip- efits of free trade as a driver lomatic network and lead a of economic growth and job coordinated effort to continue creation, as well as improv- the UK’s legacy of open trade ing living standards. “These after the divorce from the EU. are important at any stage, He was the first to arrive as the but doubly important at the members of the Cyprus-UK given moment for at least Business Association gradually two reasons,” he said. Those took their allocated seats at reasons, he added, involve the the dining table overlooking wider objectives related to the the bright green garden. Silver shared global political agenda plates with shortbread and to cut down carbon emissions mince pies were dotted across and the role that trade and the table; coffee and tea were investments play in deepening served. personal, cultural and political Three centuries ago, Britain connections. was arguably the most dom- Androulla Pittas, founding inant trading empire on the partner of corporate services Old Continent. While others company Avantium and Hon- were still trying to expand ter- orary President of the Associ- ritorially, Britain was building ation, observed that Cyprus a large network of merchants companies and consumers had and manufacturers. There are remained loyal to UK brands. even some theories that sug- “However,” she stressed, gest that trading in coffee and “from my experience with

“IF THERE ARE THINGS our clients, they have experienced er British companies did not have THAT WE CAN DO TO a lot of practical difficulties.” the financial muscle to invest in FACILITATE AND GROW Christina Jacovides has had to distribution networks in the EU, THE UK-CYPRUS TRADE deal first-hand with post-Brexit a broad spectrum of products was problems. The Vice-President of left behind. AND INVESTMENT the Association, who is Finance “Also, even though supply RELATIONSHIP, THERE’S Manager of MSJacovides Group, chain blockages are a worldwide a company that distributes phar- phenomenon, we are facing an A DEEPLY STRONG maceutical and wellness products, approximately 10% increase in COMMITMENT FROM told the gathering about major freight costs, which is affecting THE UK GOVERNMENT issues with product releases, due our goods and our competitive- TO SEE THAT HAPPEN” to the increased administrative ness,” Jacovides noted. “It would burden. “There’s a lot of paper- be good to get better prices on CHRIS BARTON work; there are inspections both freight or shipment routes from at the manufacturer’s and the the UK to Cyprus. There is a distributor’s sites that cause more strong demand for UK products delays,” she explained. “If routes and we would like to keep this are quarantined and we’re waiting business but, if the high costs for an inspection, we’re losing continue, we’ll have to reassess the valuable time.” Add to that ship- situation.” This was not stated as ment delays, the sudden addition an ultimatum but, rather, as an of VAT, custom duties and, in unavoidable conclusion. some cases, tariffs and the picture When talk turned to investments becomes even bleaker. To offset and the export of business ser- some of these issues, many British vices, the picture took a turn businesses have started looking to for the better. The Association’s rent warehouse space in the EU. Treasurer, Michael Tannousis, In 2021, for example, the Nether- who is Consulco’s Director of lands Foreign Investment Agency Investment Services, said that announced that half of the 500 more and more Cypriot investors global firms that were considering are looking to obtain London real investing in the country because estate, even in the face of Brexit, of Brexit were UK companies – COVID-19 and now, Russia, among them, all the Big Pharma trying to bully the West out of boys. However, since many small- Ukraine by turning off its gas sup- ply. “They are taking advantage of London’s maturity and liquidity,” he said and stressed that taxes are paid in Cyprus to illustrate that both economies are benefiting from UK real estate investment. On the issue of professional ser- vices, he said, “We were worried about financial passporting and there are still some grey areas with the FCA regulations, but, as of today, regulated funds have not been impacted negatively by Brexit.” “It is very difficult to isolate the impact of Brexit, given current events,” added the Association’s President, Marios Andreou, a Partner at PwC Cyprus. “And it would be useful if a big UK bank decided to set up their offices here,” Pittas chimed in. Positive developments have also been observed in the higher edu- cation sector. According to Panik-

| 138 | B U S I N E S S T A L K “WE WOULD LIKE TO KEEP THIS BUSINESS BUT, IF THE HIGH COSTS CONTINUE, WE’LL HAVE TO REASSESS THE SITUATION” CHRISTINA JACOVIDES kos Poutziouris, Rector of UCLan and a that this presented an opportunity for “MORE member of the Association, the absence Cypriot banks to use their mountains AND MORE of an agreement between the UK and of cash as loans to families wishing to CYPRIOT Horizon Europe – the EU’s key funding invest in their children’s education. “We INVESTORS programme for research and innovation have seen an increase in the number of with a €95.5 billion budget – has cre- Cypriots and of other Europeans choos- ARE ated uncertainty among British univer- ing to study in Cyprus,” he pointed out. LOOKING sities on their eligibility to participate in What is more, following Brexit, British TO OBTAIN European research programmes. This universities have started to open more LONDON has triggered a number of alliances and campuses in Europe, which offers Cy- partnerships with Cypriot institutions. prus universities an opportunity to join REAL “A couple of projects migrated from our consortiums and operate beyond local ESTATE” parent University of Central Lancashire borders. “We can play the so-called Eu- to Cyprus as an EU member state and ropean role,” he says, “because we offer MICHAEL TANNOUSIS we will act as principal investigators,” he British degrees and that’s an advantage noted. “This is being seen in other local to EU students.” universities as well.” “I’m a great believer in British educa- With the new fee structure of British tion,” said Marios Andreou, joining universities (up to £9,250 per year) the conversation and everyone round being prohibitive for a great number of the table agreed. “I think there’s an op- Cypriot and European students, and portunity for British universities to set Brexit taking the EU’s loan scheme up some kind of association in Cyprus, out of the picture, Poutziouris argued so that they can attract students who

wouldn’t otherwise go to Brit- be used to digitalise the public ain to study.” sector, invest in clean energy Barton beamed with delight and build the tech sector into a on hearing a real sense of pillar of economic activity. The optimism coming from the RRP plan will run in tandem members of the Association with Cyprus’ “Vision 2035”, and their commitment to fur- an evolving strategy to build a thering economic ties between resilient and sustainable econ- the two countries. “I wish omy, funded by EU Structural we had had this conversation Funds. This realm of plans two weeks ago, because I was and programmes is extremely speaking about all the British complex. International School opportu- “We could rely on expertise nities in Europe,” he quipped. coming from the UK to help Nonetheless, he acknowledged us make this plan come true. that customs issues remain a And, given that the EU wants thorny issue. “What we are to stop using Russian gas, really keen to do is to make opportunities arising from our sure that they’re as simple and hydrocarbons in the Eastern straightforward as possible. Mediterranean might now get Also, our ambition is to make some traction as well,” Andre- the UK border the best in the ou noted. “This could also help world, in terms of the ease of with finding a solution to the crossing,” he said. “That’s one Cyprus problem, if it’s dealt of the reasons why we have with delicately,” he added as an been deferring some controls afterthought. on imports to the UK.” The burgeoning startup eco- In 2021, the Cyprus Govern- system of Cyprus could also ment unveiled a 5-year plan act as a pole of attraction to draw €1.2 billion from the for UK investors, particular EU’s Recovery and Resilience early-stage venture capital pro- (RRP) Facility. The money will viders, who would also inject

| 140 | B U S I N E S S T A L K “WE HAVE SEEN AN INCREASE IN into the system valuable experience THE NUMBER OF CYPRIOTS AND OF as regards taking ideas to market. Poutziouris suggested that opportu- OTHER EUROPEANS CHOOSING nities for collaboration through the TO STUDY IN CYPRUS” Commonwealth would also send a positive message to the broader PANIKKOS POUTZIOURIS region that Cyprus is not merely in the EU corner but represents the best practices of British businesses. With headquartering spearheading the promotional activities of Invest Cyprus – the country’s investment promotion agency – there is also a unique opportunity to invest in private secondary school education. Andreou brought up the example of French software developer Murex, which chose to bring some 200 of its people and their families to Nicosia, based on the fact there was a French private school in the capital. So – what is British plan to promote trade and investments in this new world order? “We’re doing a lot of work to sup- port and encourage UK SMEs to export, by making sure that we’re providing clear advice,” Chris Barton explained. This includes using ‘export champions’ who act as advisors and

“GIVEN THAT THE EU WANTS TO STOP USING RUSSIAN GAS, OPPORTUNITIES ARISING FROM OUR HYDROCARBONS IN THE EASTERN MEDITERRANEAN MIGHT NOW GET SOME TRACTION” MARIOS ANDREOU strategically placed experts ing and business support to who understand local markets new startup founders across and can make connections Europe, helping them es- in both directions. “Then tablish companies in their we have financial support, local market and in the UK. through the British Business “We’re here to help,” he said Bank and UK Export Finance in a genuine, earnest way. “If – the UK’s export credits there are things that we can agency, whose stated mission do to facilitate and grow the is ‘to ensure that no viable UK UK-Cyprus trade and invest- export fails for lack of finance’, ment relationship, there’s a and we’ve many billions of deeply strong commitment pounds’ worth of facilities from the UK government to across Europe,” he said. see that happen. I’m a natural On the technology side, optimist, but I think there the Global Entrepreneur are really good grounds to be Programme offers mentor- optimistic.” “IT WOULD BE USEFUL IF A BIG UK BANK DECIDED TO SET UP ITS OFFICES HERE” ANDROULLA PITTAS

| 142 | I N V E S T M E N T GLOBAL The key liquid asset classes of equities, INVESTMENT credit and government bonds – the lion’s OUTLOOK share of institutional investors’ portfolio exposures – have all been falling this year. By Loucas Savva CFA, Consultant, Commodities (a much less widely held Aon Wealth Solutions asset) were a big standout as the Ukraine crisis and Russian sanctions worsened an already under-supplied crude oil market, and metals and grain prices also came under pressure. Equities and bonds do not fall in tandem very often, although we did observe something similar in late 2018 when the Fed- eral Reserve attempted to tighten monetary policy but then changed course after a poor market reaction and reverted to an easy stance. After all the years of stimulatory monetary pol- icy, this year’s tough talk from central banks is a major change and has fanned market turbulence. Ukraine and markets Russia’s invasion of Ukraine should be seen as an aggravating factor, rather than a causal one, in market declines, pushing commodity prices (particularly energy and grains) and expect- ed inflation higher, upping pressure on central banks to act. With sanctions on Russia still being tightened, commodity markets will likely remain nervous. Commodity demand is also key as this had been driving price gains before the war in Ukraine. China’s recent struggles with new outbreaks of COVID-19 are slowing its economy and, given its role as key commodity consumer, this is checking commodity de- mand-pull inflation. Will peaking INFLATION restore calm? Current market unease is based on more than rising inflation. The inflationary impulse is coming from multiple sources. Strains in supply chains still remain problematic (high trans- port and freight costs, order backlogs and delivery delays), although they may no longer be worsening. Just as concerning is the fact that tight labour markets are fuelling higher wages as businesses pass higher costs on in the form of higher prices. These are more persistent inflation-creating factors than high commodity prices, which could, in fact, be temporary. Our experience of high inflation episodes in the past shows that the longer inflation stays higher, the harder it is to bring it down and keep it down. Interest rates may then have to rise to levels which choke off economic activity, creating a risk of triggering outright recession. The fear of such negative economic outcomes is a major factor in the current market unease and this looks unlikely to go away. THIS YEAR’S TOUGH TALK FROM CENTRAL BANKS HAS FANNED MARKET TURBULENCE

| 143 | THE CHALLENGE NOW IS TO LOOK FOR RETURN GENERATORS WITH MORE INDEPENDENT DRIVERS Central bank tightening weakness is more marked, and the economy shrinks, taking us into Rates have only begun to rise but the much bigger damage to markets a recession. This is where the high cyclical leverage of corporate has come from the way interest rate expectations for 2022/23 as a earnings makes large outright profit falls likely. The persistent nature whole have leapt up. This has challenged asset markets at large, which of current inflation and the planned path for interest rates makes had benefited from the pandemic-driven move to zero interest rates a recession in 2023 appear more of a risk than would have seemed and plentiful liquidity. likely even a few months ago. This keeps downside risks in markets uncomfortable. The bond risk premium is back Caution on credit spreads Higher policy rate expectations have been pushing both the front-end Pressures on corporate bond credit spreads and credit default swap of the yield curve and longer-dated yields higher. Higher longer-dat- (CDS) spreads are often an early warning sign of poorer economic ed yields are, in part, reflecting a recovery in the so-called ‘bond risk conditions or, if they rise sufficiently, of a recession. The size of the premium’ – the added compensation that investors in longer dura- move so far does not yet signal economic trouble, falling well short tion bonds seek for unexpected inflation or interest rate shifts. For even of previous credit stress points which did not lead to a recession, many years, this risk premium has been very low and, in some coun- such as 2015-16’s energy price shock. tries, negative, reflecting huge central bank bond buying and little An eventual macroeconomic deterioration and less buoyant corporate fear of high inflation. On both counts, the position has changed, as profitability would widen spreads from current levels. Clearly, some central banks cease buying bonds and inflation/interest rate uncer- supports do remain, which reduces the likelihood of very large credit tainties rise. spread widening, but central bank support is far less likely to be seen again in a market sell-off. Equity risk premium less supportive Persistent inflation, rising interest rates, a withdrawal of central bank The significant rise in global mid- to long-duration bond yields has partial- liquidity and higher economic uncertainty are pushing market vola- ly eroded an important underpinning of the case for equities since the tility higher on an underlying basis. Higher volatility signals a more end of the financial crisis – the equity risk premium. This is the addi- changeable market environment, and one in which support from tional reward equity investors might reasonably expect over govern- governments and central banks is limited, given that much fiscal and ment bonds for the added risk. Thanks to low or falling bond yields, monetary policy ammunition has already been utilized due to the a high equity risk premium has been supportive for many years. pandemic. Earnings support likely to fade While the rise in bond yields takes away some support to valuations, Focus on DIVERSIFICATION equities are ultimately fuelled by profits (earnings). Higher market Elevated inflation and subsequent policy tightening are likely to create a valuations have been a big contributor to market gains in recent headwind for traditional 60/40-type portfolios. The interlocking shocks years but nobody can deny the impressive revival of corporate profits of Ukraine, higher inflation and rapid central bank action repricing have since the pandemic falls. That said, a part of this is pushed equities and bonds to become more correlat- a one-off, reflecting unusually buoyant economic ed. This is a good time to see which of the existing di- conditions created by huge monetary and fiscal About Aon versifiers in a portfolio might be expected to perform stimulus. well and whether some reinforcing is required. Just weaker or recessionary? Aon plc (NYSE: AON) exists to shape The challenge now is to look for return generators The trickier question is whether earnings growth decisions for the better – to protect and with more independent drivers. Most alternative asset classes, particularly in illiquid private markets enrich the lives of people around the will stabilise at a reasonable level which warrants world. Our colleagues provide our clients (e.g. real estate, infrastructure) do have independent in over 120 countries with advice and current market valuations or whether economic solutions that give them the clarity and drivers but many investors will have liquidity or fee conditions turn down faster, under the strain of an confidence to make better decisions to constraints which limit their use. In the liquid space, inflation-hit consumer, cost-burdened corporates, conservative hedge fund strategies will have low de- and the cooling effects of rising interest rates. A protect and grow their business. pendence on rising markets and some will directly For more information, please visit www. slowing economy can be ridden out without too aonsolutions.com.cy benefit from rising volatility and greater market un- much market risk. The bigger problem arises if certainty.

| 144 | F I N E D I N I N G Whatever your personal preference, there is certain to fInest be a high-quality venue ready dining to tantalise your taste buds in a charmingly luxurious setting somewhere in Cyprus. The island boasts a good selection of fine-dining venues that collaborate with top international chefs and their globally-branded chains. Enjoy our selected recommendations below to turn any dining experience into a special occasion. Vivaldi by Mavrommatis Situated inside the luxurious Four Seasons Hotel in Limassol and operated in conjunc- tion with the renowned Paris-based Michelin star awarded Cypriot Chef Andreas Mavrom- matis, this multiple prize-winning venue’s recipe for success is based on the simplicity of its market-fresh Mediterranean ingredients. Matsuhisa Limassol World-renowned chef Nobu Matsuhisa and the Amara Hotel in Limassol come together to set a new standard in Cyprus’ culinary life with a unique Japanese-Peruvian culinary experience and bespoke array of Nobu’s legendary signature dishes. Guests can enjoy their meals, including one-off signature pieces, in a space designed by David Rockwell.

Ristorante Locatelli | 145 | Also at the Amara Hotel, Ristorante Locatelli is the Cy- Armyra By prus-based incarnation of the revered London-based, Miche- Papaioannou lin-star restaurant headed by celebrity chef Giorgio Locatelli. It boasts a menu embodying Italy’s spirit of conviviality, Another fine choice at whereby the heart of cooking is defined as the enjoyment of the Amara Hotel, Army- quality food in good company. The al fresco dining experi- ra by Papaioanou brings ence also offered by the venue is highly popular. the vision and experience of Chef George Papa- ioannou and his brain- child, Armyra to Cyprus, with the freshest fish, seafood and many more culinary delights pre- pared with the region’s purest ingredients. The open-air fish restaurant sees diners serenaded by the waves as they enjoy the riches of the seas. Nammos LPM Restaurant Bar Limassol A brand-new arrival this summer is Located at Parklane, a Luxury Collection Resort and Spa in Limassol, and with Parklane Resort & Spa’s Nammos the Mediterranean as a backdrop, LPM Limassol is completely in tune with Limassol. The menu is a homage to the spirit of the place including seafood freshly sourced from the nearby local produce with seafood flavours waters. Inside you’ll find the hallmarks of all LPMs around the world: and quality meats. The wine and cock- bright art, flowers and crisp linen. The classic LPM bar overlooks the room tail list completes a culinary journey while an oyster bar allows occupants to view the open salad and prep-area. through the Mediterranean way of life Diners can also enjoy sunset dining on the terrace. from a brand that started life on the beaches of Mykonos and now enjoys a popular presence in prime locations from the French Riviera to Dubai.

| 146 | F I N E D I N I N G Le Deli Robuchon L’Atelier Robuchon Also at Ayia Napa Ma- L’Atelier Robuchon are known as being particularly rina, Le Deli Robuchon decorative Michelin Star restaurants, serving the late offers a casual yet sophis- master chef Joël Robuchon’s signature tantalising and ticated all-day dining fresh take on French haute cuisine in a stylish black and space, serving coffee, red environment. This chic addition to the global col- breakfast, lunch, dinner lection of venues, situated at Ayia Napa Marina, is no and snacks with eat-in exception to the rule. or take-away options and a patisserie. Le Deli also offers a carefully selected range of wines, teas, cheeses, pastries and breads all handmade with quality ingredients. Many of the products in the Deli were personally selected and championed by Chef Robuchon.

| 147 | Copyright © 2022 IMH All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the publisher

fifth edition

A Growing Headquartering Hub for Tech Companies Cyprus is home to a number of global ICT companies, using the island as a hub for soſtware development, systems integration, testing services, disaster recovery, research & development activities, project management and marketing & sales, while servicing clients in Europe, the Middle East, North Africa and beyond. Strategically located at the crossroads Well-educated workforce of Europe, Africa and Asia and tech-savvy talent A modern and dynamic EU & Strong and reliable Eurozone Μember State professional services Ideal location for tech companies Low cost to set-up and scale their business of doing business Wide and easy access to A thriving headquartering high growth markets jurisdiction High quality of life Efficient and transparent in a safe environment tax & legal framework Invest Cyprus, a state-owned, non-for-profit organization, provides hands-on support through a dedicated team, welcoming enquiries from international tech companies looking to establish their regional headquarters in Cyprus. Invest Cyprus www. investcyprus.org. cy