Russian companies have been increasingly leaving Cyprus as Western sanctions impact their ability to operate, the Russian state-controlled media outlet Kommersant wrote on Jan. 16.
According to Kommersant, many of the Russian businesses feeling the bite of Western sanctions have chosen to relocate to Russia or to countries friendlier to Russian business, such as Kazakhstan or the United Arab Emirates.
A massive leak of financial documents from Cypriot financial service providers in November 2023, dubbed "Cyprus Confidential," and a subsequent investigation by the International Consortium of Investigate Journalists (ICIJ) found that financial services in Cyprus actively helped Russian oligarchs and allies of Russian President Vladimir Putin evade sanctions.
Following the disclosures, Cypriot President Nikos Christodoulides said he invited financial crime experts to assist with investigations into sanctions circumvention.
There should be “absolutely no shadows” over Cyprus because it harms the ability to attract "quality" foreign investment, he said.
Recent reports also show that Cyprus' crackdown on Russian money may have been fruitful.
The Moscow Times said in December that the U.S. Federal Bureau of Investigation (FBI) had increasingly become interested in Russian business and oligarchs in Cyprus, prompting the departure of at least 10 of the largest Russian businesses operating on the island. It is unclear if the FBI's growing focus on Cyprus was related to the ICIJ report.
Cyprus has long been considered one of the primary destinations in Europe for Russian money.
The AP wrote that in 2013, 40% of the country's total deposits came from Russians. Despite Western sanctions implemented after the beginning of the full-scale invasion, Russian and Belarusian money has still flowed to the island nation.
The Russian influx to Cyprus has not just been limited to the economic sphere. Long a popular destination for Russian emigres, both Cyprus and the Turkish-occupied region in the northern part of the country have become seen the increased relocation of Russians since the full-scale invasion.
Almost 40,000 Russians settled in Northern Cyprus in 2023 alone, the Guardian wrote in September, out of a total population of 382,000 in the de-facto republic.