Cyprus businesses face funding and education gaps

Cypriots have strong entrepreneurial perceptions and intentions but have to contend with structural challenges which ultimately limit the creation of new businesses, according to the 9th national entrepreneurship report for Cyprus, conducted by the Global Entrepreneurship Monitor (GEM).

The presentation of the report, which covered the 2024-2025 period, took place at the University of Cyprus, with the participation of representatives from academia, the business community and the state.

According to the findings, 40.2 per cent of adults in Cyprus believe there are good opportunities to start a business, maintaining the positive trend seen in recent years.

At the same time, 47.8 per cent consider it easy to start a business, a figure close to the European average.

Confidence in entrepreneurial ability remains particularly high, with 59.9 per cent stating they possess the necessary knowledge, skills and experience to launch a business.

In addition, 68.3 per cent of adults say they personally know an entrepreneur, underlining the strong presence of entrepreneurial networks in Cyprus.

Entrepreneurial intention is also elevated, with 24.1 per cent of adults expecting to start a business within the next three years, exceeding the European average.

Despite this positive picture, fear of failure continues to act as a deterrent, with 50.8 per cent of citizens saying it influences their decision to pursue entrepreneurial activity.

In terms of actual activity, early-stage entrepreneurship in Cyprus stands at 9.7 per cent, while entrepreneurship among established businesses rose further to 8.4 per cent.

The report also shows that entrepreneurial activity is more pronounced among younger individuals and those with higher levels of education, while a significant gender gap persists in early-stage entrepreneurship.

Particular emphasis is placed on growth prospects, with 38.3 per cent of early-stage entrepreneurs expecting to create six or more jobs within five years.

At the same time, there is a stronger orientation towards digitalisation and the use of new technologies, including artificial intelligence.

However, the report identifies that the integration of sustainability practices remains limited, while weaknesses persist in access to finance, entrepreneurial education, research and development, and state support programmes.

“The results are particularly encouraging as they demonstrate increased confidence and intention among citizens, but they also highlight challenges that require coordinated action from all stakeholders,” said the rector of the University of Cyprus Tasos Christofides.

It was also noted that “the University of Cyprus’ Entrepreneurship Centre acts as a bridge between academic knowledge, research and the market, through educational programmes, acceleration initiatives and international collaborations”.

“The GEM results are an important monitoring tool and support efforts to develop Cyprus as a competitive and business-friendly destination,” said Deputy Director of the Department of Industry at the Commerce Ministry Themis Papasolomontos.

“Small and medium-sized enterprises form the backbone of the Cypriot economy, contributing to competitiveness, growth and resilience,” she added.

It was further stated that €227 million has been secured under the 2021–2027 programming period for the funding and implementation of business support schemes.

An additional €124 million has been allocated through programmes financed by the Recovery and Resilience Facility, reinforcing efforts to support entrepreneurship in Cyprus.