I have been living in Limassol since March. A few months in, the tourist excitement has worn off and I am starting to see things through an entrepreneur’s eyes. I chose Cyprus for the sea, the sun and the clean air, but also for something far less poetic: the way the state treats people who do business. I wrote separately about why I moved to Cyprus.
This is not a piece meant to praise one country and bash the other. I have been building businesses in Romania since I was 18, from popcorn to software, and I will keep working with people there. It is an honest comparison from someone who now has a foot in each place. Some things work better here; others clearly work better back home.
1. The state’s attitude: clear, stable rules
The first thing that surprised me in Cyprus was not a low tax or a quick procedure. It was the feeling that I know the rules of the game from the start and that they will not change halfway through the match. When you ask how something is done, you get an answer. When you do it, you do not wake up three months later to find that everything has changed in the meantime.
It is not a paperwork-free paradise. There are forms, there are queues, there are civil servants having bad days. The difference is in the tone: the state seems to start from the idea that an entrepreneur is a partner who brings money and jobs, not a suspect to be policed. I have found fairness and transparency, and that is worth more than any tax incentive.
In Romania, my problem was never the level of taxes as such, but how unpredictable they are. Last year I wrote that overnight tax changes are killing business, and things have not calmed down since. When rules change through emergency ordinances (government decrees that take effect immediately, before parliament debates them), sometimes from one month to the next, you cannot plan three years ahead. And without long-term planning, you do not build anything serious.
2. Labour taxes: salaries people can actually live on
I will not quote figures here, because they change and every situation is different. But the overall impression is clear: in Cyprus, the tax burden on employees’ wages is more reasonable. That means something very concrete. With the same budget, you can pay someone enough to live well on their salary, without schemes, without half the money paid under the table, without awkward negotiations.
To me, this is the test of a healthy society: a person who works honestly should be able to live decently on their salary, and the employer should be able to afford paying them that way. When the gap between what an employee costs and what they take home is too large, both sides lose, and the state ends up encouraging exactly what it says it wants to fight: grey-market work.
In Romania, at the start of this year, social contributions were shifted from the employer to the employee, and companies and workers had to rush to redo calculations and contracts. Perhaps the intention was good. The execution left many entrepreneurs feeling they are always the last to know.
3. Language: English opens doors
Officially, Cyprus speaks Greek and Turkish. In practice, English is used everywhere: at the bank, at the lawyer’s, at the accountant’s, in many public offices. It feels almost like a second official language to me. For anyone working internationally, that changes everything. Contracts, correspondence and conversations with partners can happen in the same language you use with clients abroad.
Say you run a software company with clients in Germany, the United States and Israel. In an environment where everyone, including the administration, works comfortably in English, you no longer need translations for every document. It sounds like a detail, but over time it saves you whole days and a lot of frustration.
Here Romania has an asset we underrate: young Romanians speak excellent English, often better than their peers in Western Europe. The problem is that the state still works almost exclusively in Romanian, and a foreign investor feels it from the very first form.
4. People and society: openness and calm
Limassol is an international city. Next to the Cypriot selling you coffee you will find British, Russian, Israeli, Lebanese, Greek and Romanian people. Everyone is relaxed, open, used to foreigners. Nobody is in too much of a hurry, and at first that drove me mad. Now I am starting to think part of that calm comes from people not living in fear of what the state will spring on them next month.
In Romania, the energy is enormous. I have worked with people who learn a new technology over a weekend and can build products that compete globally. What is missing is trust. The state looks at entrepreneurs with suspicion, entrepreneurs look at the state with fear, and ordinary citizens look at both with distrust. I once wrote about what a fair society means to an entrepreneur, and this comparison confirms the idea: trust is infrastructure, just as important as motorways.
5. What Romania does better
It would be unfair to suggest everything back home is bad. There are things Romania does better than Cyprus and better than many Western European countries:
- The internet. Connection speeds and prices in Romania are among the best in the world. After a few months here, I appreciate that more than ever.
- Digital talent. Romanian developers, designers and marketers are very good and learn fast. It is no accident that many big tech companies have opened offices in Bucharest, Cluj and Iasi.
- Entrepreneurial energy. In Romania people start businesses with very little capital and a great deal of stubbornness. Romanian founders are used to fighting obstacles, and that makes them resilient.
- The market. A country of nearly 20 million people is a real, growing market, with online retail that still has plenty of room to expand.
The paradox is that people and private companies move faster than institutions. As I have said before, the state is ten years behind its people. If that gap closed, Romania would be one of the most interesting countries in Europe to do business in.
6. What I would take from each
If I could build an ideal country for entrepreneurs, I would take from Cyprus the predictability, the reasonable labour taxes, English in the administration and the calm relationship between the state and taxpayers. From Romania I would take the internet, the technical talent, the hunger to build and the courage to start something from scratch.
The good news is that nothing Cyprus has comes down to geography. Stable rules, consulting business before a change and an administration that answers clearly are choices, not luck. And anyone who wants to build globally can do it from Bucharest too, as I wrote about building a SaaS from Romania for customers worldwide.
Instead of a conclusion
I do not miss much about Romania apart from my friends. But I see them often, because I go back to visit whenever I can. And every time I leave with the same feeling: we have extraordinary people; all we lack is a state that trusts them.
What do you think: what should Romania change first so that entrepreneurs stop looking at other countries? Stable rules, the level of taxes, or the relationship with the administration?