Minister reaffirms support for industrial sector – €14.4 million earmarked for Cypriot SMEs

Energy Minister George Papanastasiou on Monday opened this year’s Industry Week by reaffirming the government’s resolve to support the sector in Cyprus, underpinned by its commitment to the national industrial policy spanning the 2019-2030 period.

He explained that the ultimate objective is to foster a robust, flexible, smart, and technologically advanced industry, contributing significantly to the growth and competitiveness of Cyprus’ economy.

“It is worth noting that despite significant challenges, especially in the last three years, the industrial sector in Cyprus has not only managed to cope but also increased its contribution to our Gross Domestic Product from 8.1 per cent in 2020 to 8.5 per cent in 2022,” Papanastasiou said.

“At the same time, also during this year, employment in the sector rose to 9 per cent of the workforce, up from 8.1 per cent in 2020,” he added.

Moreover, he explained that technological upgrades and the modernisation of existing industrial units, along with the provision of incentives for new creations, are the primary focus of the majority of co-financed grant schemes implemented by the Energy Ministry.

The minister noted that during the current programming period until 2027, Cyprus has secured funding of €245 million from the European Structural and Investment Funds and the Recovery and Resilience Fund for the purpose of supporting businesses.

Additionally, another €120 million will be allocated for energy upgrades in residences, indirectly positively impacting entrepreneurship and particularly the industry.

What is more, Papanastasiou stressed the significance of transitioning the economy toward a green and circular model, aligning with Cyprus’s Industrial Policy until 2030.

In this context, collaborations between the Ministries of Energy, Agriculture, and the Deputy Ministry of Research, Innovation & Digital Policy have resulted in the National Action Plan for the Circular Economy, aiming to create conducive market conditions for this sustainable economic shift.

“With the implementation of this Action Plan, approved by the Cabinet of Ministers on June 16, 2021, but primarily through the participation and support of our partners in the business community, we anticipate creating the necessary conditions in the market to transition to a genuinely circular and sustainable economy,” Papanastasiou said.

“The involved ministries and directorates are making intensive efforts in this direction, starting with cultivating the required culture to adopt circular practices, both among the general public and businesses,” he added.

Moreover, the minister outlined plans for a sponsorship scheme promoting the Circular Economy, expecting to aid over 40 small and medium enterprises with a maximum funding amount of €400,000 and support intensity reaching 50 per cent of the investment.

He also provided details about the ministry’s grant scheme to promote the Circular Economy, for which a draft law has already been prepared, and is now before the relevant technical committee for final assessment and approval. The plan is set to be officially launched in 2023.

“Our scheme aims to provide incentives to small and medium-sized enterprises, totalling €14.4 million, to implement investments that will enable them to transition to a circular business model,” Papanastasiou said.

“Through the scheme, it is expected that support will be provided to more than 40 SMEs, with a maximum funding amount of €400,000 and a support ratio reaching 50 per cent of the investment,” he added.

Minister Papanastasiou concluded by expressing gratitude for attendees’ shared concern for bolstering Cyprus’ industrial sector and acknowledging its substantial contribution to society and the local economy.