Cyprus’s proposed €14.4 billion state budget for 2027 will come before the House Finance Committee on Monday, as Finance Minister Makis Keravnos presents the government’s spending plans, economic forecasts and fiscal priorities.

Scheduled to begin at 9:15 am, the hearing will launch parliament’s review of allocations for ministries, government departments and state institutions.

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Social Welfare, Healthcare And Education Spending To Rise

Total expenditure is projected to reach €14.4 billion, up from €13.7 billion in 2026, an increase of approximately €700 million, or 5.1%. Excluding debt servicing, spending is expected to stand at around €11.1 billion, with priorities including social welfare, healthcare, education, infrastructure and economic development.

Social welfare benefits account for €820 million. Healthcare funding is set to reach €1.066 billion, up 3.7% from 2026, while education spending will increase by 13.8% to €235 million. Road infrastructure funding is projected to rise by 17.4% to €148.8 million.

Transfer payments remain the largest spending category, increasing from €4.24 billion to €4.49 billion. These cover social benefits, contributions to the Social Insurance Funds and the General Healthcare System (Gesy), alongside transfers to public organisations and local authorities.

Personnel expenditure is expected to edge up from €3.71 billion to €3.75 billion, while operating costs are projected to rise by 15.4% to €1.86 billion. Higher spending is linked partly to defence and policing requirements, water purchases and maintenance.

Infrastructure Investment And Defence Priorities

Capital expenditure is forecast at €594.5 million, up 2.1%, for public buildings, roads and other infrastructure. Major projects include €27.9 million for the new Cyprus Museum, €18 million for the Paphos-Polis Chrysochous Road, €15.9 million for the Deneia-Akaki-Astromeritis road and €13.5 million for the new Legal Service building.

Overall development expenditure is expected to reach €1.165 billion. The government also plans to reduce permanent public-sector posts by 51 compared with 2026.

Defence spending is set to increase from €176.8 million in 2026 to €430.15 million in 2027. This allocation forms part of a €1.28 billion programme covering 2027-2029, focused on military equipment and infrastructure.

Growth Forecasts And Fiscal Targets

GDP growth is forecast at 2.9% in 2027, with inflation expected to reach 2.5%. When submitting the budget to House President Annita Demetriou on September 24, Keravnos said unemployment was expected to settle at around 3.8%, while public debt was projected to fall to 45.2% of GDP by the end of the year.

He also forecast a fiscal surplus of approximately 4% of GDP, which would mark the third consecutive year of a positive balance.

These projections differ from earlier government estimates issued in September, which put the headline fiscal surplus at 2.8% of GDP, the primary surplus at 4% and public debt at 46.6% of GDP. The revised figures are expected to feature in the economic outlook presented to lawmakers.

Economic Uncertainty Adds To Budget Debate

Parliamentary deliberations come amid geopolitical uncertainty, with developments in the Middle East and volatility in international energy markets posing potential risks to economic growth and inflation.

In a statement on Sunday, the Finance Ministry described the budget as balanced and people-centred. According to the ministry, prudent public-finance management has enabled the government to direct more resources towards social policy, healthcare, education and development while maintaining economic stability.

Officials also expressed readiness to engage in constructive dialogue with parliament, arguing that approval of the budget would support the smooth functioning of the state and delivery of planned projects and programmes.

Parliamentary Review To Continue Through November

The Finance Committee is scheduled to examine individual ministry allocations until November 16, followed by a three-day plenary debate and vote in December.

Efforts to attract investment, cut bureaucracy and improve Cyprus’s business climate were the focus of talks between Deputy Minister to the President Irene Piki and the Nicosia Chamber of Commerce and Industry, as businesses continue to call for faster reforms.

Piki met chamber president Michalis Mousiouttas and board members to discuss challenges facing companies in the capital and opportunities to support economic growth.

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Government And Businesses Seek Closer Cooperation

In a post on X on Sunday, Piki stressed that closer cooperation between the government and the private sector is essential to removing investment barriers and improving competitiveness. She identified the Cyprus Chamber of Commerce and Industry (Keve) and its district chambers as key partners in building a more competitive economy.

Businesses Highlight Structural Challenges

The Nicosia chamber continues to raise concerns over bureaucracy, labour shortages, infrastructure gaps and rising operating costs. At its general assembly in November 2025, Mousiouttas called for a more predictable business environment, citing administrative delays, traffic congestion, energy costs and water shortages. He also backed development projects involving the former state fair grounds and the Sopaz area.

The chamber has since held talks with Labour Minister Marinos Mousiouttas on labour shortages, pension reform and the EU Pay Transparency Directive, and with Transport Minister Evi Tsolaki on infrastructure and development challenges.

Measures To Improve Cyprus’s Investment Appeal

The government launched the Business Support Centre in May 2025 to provide investors with a single point of contact for establishing or expanding operations. The centre brings together business facilitation, investment promotion and licensing services.

For qualifying strategic projects, a separate fast-track process aims to secure planning and building permits within 12 months, with dedicated coordinators helping to reduce administrative delays.

Revitalising Nicosia’s Historic Centre

The municipality has secured €10.8 million to redevelop Ledra and Onasagorou streets under the Green Line revitalisation programme. The project includes improvements to building façades and public spaces, though shopkeepers have warned of disruption during construction. In September, the municipality said it was consulting affected businesses and residents on ways to limit the impact.

A separate €10 million government scheme supports new businesses, existing enterprises and job creation in Nicosia’s walled city. The programme, designed to regenerate the historic centre through annual funding allocations, is due to run until the end of 2026.

Funding Available, Implementation Still Key

Support for industry also includes €226 million in schemes under the Thalia 2021-2027 programme and a further €137 million in European recovery and energy-related funding. These resources target manufacturing, innovation, digital transformation and the energy transition.

Businesses argue that funding must be matched by simpler procedures and faster implementation. Piki’s meeting reflects the continuing effort to translate national investment policies into practical improvements for companies in Nicosia. No new funding commitments or reform deadlines were announced after the talks.

Apple has reached an agreement to hire employees and license technology from Huxe, a personalized audio startup founded by former Google developers behind its AI-generated podcast features. The arrangement, disclosed in a filing with the European Commission, follows a deal structure increasingly used by major technology companies to acquire talent and intellectual property without purchasing a startup outright.

The transaction appears to be a reverse acqui-hire, a model that allows companies to bring in key employees and access technology while leaving the startup itself outside a traditional acquisition.

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What Apple Disclosed To Regulators

According to the European Commission filing, Apple agreed to make employment offers to “certain employees of Huxe AI” and obtain a non-exclusive licence to the startup’s intellectual property. The document does not identify the employees involved, confirm whether they accepted the offers or explain how Apple intends to use the technology.

As reported by MacRumors, the disclosure provides a rare public look at a transaction structure that has become more common across the artificial intelligence industry.

Reverse Acqui-Hires Gain Ground In The AI Race

Technology companies are increasingly using these arrangements to secure specialised talent and promising technology without completing a full acquisition. Such deals can help larger platforms accelerate product development while avoiding some of the regulatory scrutiny associated with traditional takeovers.

The terminology remains fluid, with similar transactions described as both “reverse acqui-hires” and “acqui-hires.” However, the underlying strategy is consistent: gaining access to a startup’s most valuable people and intellectual property without necessarily acquiring the entire business.

Why Huxe Attracted Apple’s Interest

Huxe was founded by developers who previously worked on AI-generated podcast features in NotebookLM, Google’s experimental research product later renamed Gemini Notebook.

The startup focused on personalised audio, a format that could change how people consume information by turning content into tailored listening experiences.

Its time as an independent company was short. On May 21, Huxe announced that it would shut down its service, remove its app from Apple’s and Google’s app stores and delete user data.

“The team is moving on to new things, and we won’t be continuing development of the product,” the company said in a message to users. It also thanked its community for sharing feedback, ideas and recommendations throughout the product’s development.

Apple’s Deal Followed Huxe’s Shutdown

Apple notified the European Commission of the agreement on June 9, shortly after Huxe announced it was winding down. The timing suggests Apple moved to secure access to the team and its technology as the startup prepared to close.

However, the filing does not clarify whether Apple intends to use the technology in its Podcasts app, integrate it into other services or pursue a broader strategy around personalised audio.

Personalised Audio Draws Big Tech Interest

Huxe’s shutdown came one day after Spotify unveiled its own AI-powered podcast generation features, highlighting growing competition among major platforms to develop new listening experiences.

Apple’s agreement could help it expand its capabilities in this area, although the company has not disclosed its plans for Huxe’s technology. The deal also reflects a broader trend in the AI sector, where specialised teams and intellectual property can be as valuable as established products.

Whether personalised audio becomes a mainstream way to consume information remains uncertain. For now, Apple’s move indicates that the company sees potential in the technology and the people behind it.

Concerns over artificial intelligence safety are growing as the technology advances and questions emerge over whether safeguards can keep pace. Microsoft co-founder Bill Gates, Anthropic CEO Dario Amodei, OpenAI CEO Sam Altman and SpaceX CEO Elon Musk have all warned about the potential risks posed by increasingly powerful AI systems.

The debate has intensified in recent weeks. An AI researcher who left Anthropic accused both Anthropic and OpenAI of “gambling with our lives.” Later that day, an Anthropic alignment lead warned that there was a greater than 10% chance AI could “kill all humans” within the next decade.

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Trump Emphasises Competition Over AI Risks

President Donald Trump has taken a different approach, repeatedly downplaying the risk of AI-driven extinction and framing the technology primarily as a strategic competition with China.

His administration recently established a new “AI Force,” led by Director of National Intelligence Jay Clayton, to support the AI industry and identify bad actors. The initiative reflects the administration’s focus on strengthening the United States’ position in the rapidly developing sector.

Nadella Calls For AI Systems To Be Observable

Microsoft CEO Satya Nadella has argued that the next generation of AI systems should be built around what he calls “principles of observability,” allowing their behaviour to be monitored, tested and independently assessed.

His proposed safeguards include model diversity, human-readable records of model actions, continuous system testing, independent controls, auditability, containment measures and incident disclosure. Together, these mechanisms could help organisations identify problems, understand how AI systems behave and respond when something goes wrong.

Nadella’s argument centres on the idea that safety should not depend solely on confidence in a particular model. Instead, systems need safeguards that make their behaviour transparent and allow people to retain meaningful oversight.

“The most trustworthy Super Intelligence system will not be the one with the model we trust most. It will be the one that enables us to trust the model the least,” Nadella said.

Cyprus has launched its first public consultation on priorities for the EU’s Common Agricultural Policy (CAP) for 2028–2034, as the country prepares for changes to agricultural funding, climate adaptation and rural development.

The consultation opened at the Mountainous Larnaca Environmental Information Centre in Skarinou, attended by Agriculture Minister Christos Senekis, Commissioner for Agricultural Payments Andreas Kyprianou and Permanent Secretary of the Directorate-General for Development Penelope Papavasileiou.

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€2.3 Billion Framework Offers New Opportunities

Under the European Commission’s proposal, Cyprus would receive approximately €2.3 billion through its National Plan, including €415.9 million specifically allocated to agricultural income support and CAP measures.

By comparison, the current 2023–2027 CAP Strategic Plan has €373 million in European funding over five years. The new framework would give Cyprus greater flexibility to allocate additional National Plan resources to agricultural interventions, investment, generational renewal, risk management, environmental measures, climate adaptation and rural development, according to identified needs.

Cyprus has also secured a provision requiring at least 10% of National Plan resources beyond the guaranteed CAP allocation to support projects and interventions in rural areas.

Improving Access To Finance

On 29 April 2026, the Council of Ministers approved a scheme to facilitate investment lending for farmers, with implementation expected in the near term. Better access to credit could help producers address rising costs, water scarcity and the need to modernise their operations.

A New Structure For Agricultural Funding

From 2028, the CAP is expected to become part of a broader National and Regional Partnership Plan for Cyprus, replacing the standalone Strategic Plan used in the current cycle. This integrated framework aims to improve coordination with Cohesion Policy and Fisheries Policy while placing greater emphasis on measurable objectives and results.

During negotiations under Cyprus’ presidency of the Council of the EU, the government also opposed an initial European Commission proposal to exclude farmers who had reached retirement age from direct payments. According to the Ministry of Agriculture, Cyprus argued that the measure would harm a sector in which many older farmers remain active. The provision was subsequently removed from the final text.

Addressing Agriculture’s Structural Challenges

Cyprus’ agricultural and livestock sectors face high production costs, prolonged drought, climate change, an ageing farming population and administrative complexity. The next CAP cycle is expected to help improve competitiveness, encourage younger generations to enter farming and support more sustainable production.

To gather producers’ views, the Department of Agriculture has launched an online questionnaire covering six key areas:

• The main challenges facing Cypriot agriculture in 2028–2034.
• Which agricultural sectors should receive priority.
• Which criteria should carry the most weight when allocating support.
• Which investments would most improve competitiveness.
• Which measures would be most effective in attracting young farmers.
• Where CAP procedures need to be simplified.

Participants can also submit suggestions for new measures and improvements to existing policies. Through this consultation, authorities aim to ensure that the needs of farmers, livestock breeders and rural communities are reflected in Cyprus’ final priorities.

Consultation Continues Through 2027

The first consultation phase will run until the end of November 2026, with written recommendations accepted by the Department of Agriculture. A second round is planned for 2027, following preparation of the draft CAP chapter.

Over the next seven years, the resulting framework will help determine how Cyprus allocates agricultural support and responds to the economic, environmental and demographic pressures facing rural communities.

Edge computing is moving beyond experimentation as businesses expand their Internet of Things (IoT) infrastructure. Research firm Omdia found that 62% of organisations have adopted edge architectures, highlighting the technology’s growing role in enterprise operations.

Investment Shifts Towards Edge Infrastructure

Omdia surveyed 570 IoT decision-makers across 10 countries and found that 42% ranked edge processing as their top technology investment priority.

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Adoption is also moving beyond initial testing. According to the research, 78% of edge deployments have progressed past the pilot stage, with 53% reaching moderate or extensive scale across business units or entire organisations.

Enterprises Report Strong Results

Among organisations that have implemented edge computing, 87% said their deployments met or exceeded expectations.

John Canali, Omdia’s principal analyst for IoT, said growing interest in artificial intelligence and machine learning was prompting businesses to adapt their architectures to support processing closer to where data is generated.

Improved security, lower data transmission costs and reduced latency are also encouraging adoption, Canali said. Omdia found that 36% of deployments had reached moderate scale, while 17% had expanded extensively.

Security And Integration Remain Challenges

Despite positive results, security remains the biggest obstacle to wider adoption, cited by 31% of respondents. Distributed infrastructure can increase the complexity of protecting systems across multiple locations.

Integration is another significant barrier. Some 29% of respondents reported difficulties connecting edge environments with operational technology and business processes, while 28% struggled to integrate them with legacy IT systems.

Funding was less frequently cited as a constraint, with 21% identifying budget limitations as a challenge.

Secure Integration Will Shape The Next Phase

Omdia said technology providers and service partners will be important in helping businesses expand edge deployments. Priorities include strengthening security across distributed sites and ensuring compatibility between existing infrastructure and systems from different vendors.

As enterprises incorporate AI and machine learning into IoT operations, the next stage of adoption will depend on their ability to integrate edge computing securely and scale it across their organisations.

Tesla is facing growing scrutiny over how it markets its Full Self-Driving (FSD) software in Europe, where regulators have questioned whether the name accurately reflects the technology’s capabilities. German authorities described the original branding as “somewhat misleading,” arguing that it could give drivers an exaggerated impression of the system’s autonomy.

Despite its name, FSD remains a driver-assistance system that requires drivers to stay attentive and ready to take control.

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Regulatory Pressure Drives A Branding Shift

Germany’s Federal Ministry of Transport said the FSD name suggested a level of autonomy the software does not provide. The dispute highlights the tension between automakers’ marketing ambitions and regulators’ efforts to ensure that product names reflect actual capabilities.

In the United States, Tesla continues to offer the package as Full Self-Driving (Supervised), with a subscription priced at $99 per month. In Europe, its expansion depends on regulatory approval across multiple markets, making compliance and product descriptions increasingly important.

Europe Is Key To Tesla’s Autonomy Plans

Tesla has pushed European regulators, particularly in the Netherlands, to accelerate approval of its advanced driver-assistance software. Europe is an important market for the company as electric vehicle demand improves in parts of the region and Tesla seeks to recover from a previous sales downturn.

However, the approval process has attracted criticism. Reuters has reported that Tesla’s lobbying efforts have, in some cases, led regulators to reduce the intensity of safety testing and reviews, raising questions about the balance between commercial interests and public oversight.

U.S. Investigations Add To Safety Concerns

Tesla’s FSD system is also under investigation in the United States. The National Highway Traffic Safety Administration is examining its performance in conditions including fog and intense sunlight, as well as whether the software has contributed to traffic violations and collisions.

Legal challenges have added to the pressure. In December 2025, a California judge found that Tesla had engaged in deceptive marketing by implying that Autopilot and FSD were fully automated. Tesla has since countersued the California Department of Motor Vehicles in an effort to overturn the state’s “false advertiser” designation. The case remains pending.

Experts Question Transparency Of Approvals

Missy Cummings, an autonomous systems expert and engineering professor at George Mason University, argued that changing the branding does little to resolve the underlying safety concerns. In comments to CNBC, she questioned whether European regulators were adequately considering ongoing U.S. investigations into Tesla’s software.

“The EU is struggling to keep up in the AI marketplace,” Cummings said. “Musk sees this and is definitely bullying them as a result.”

She also criticised the Dutch vehicle regulator, RDW, for approving FSD in Europe based on what she described as “secretive data,” arguing that the public should have greater transparency around approvals for AI-powered transportation systems.

Tesla and RDW did not immediately respond to requests for comment.

Tesla Reports 1.48 Million Active FSD Subscriptions

In its second-quarter earnings update, Tesla reported 1.48 million active FSD subscriptions but did not disclose how many involved free trials or promotional offers. The omission makes it difficult to assess the product’s paid adoption accurately.

As autonomy remains an important part of Tesla’s long-term business strategy, the company faces challenges extending beyond technology development. Regulators are scrutinising both the software’s safety and the claims used to market it, keeping questions about capability, oversight and consumer trust at the centre of the debate.

The Cyprus Institute of Neurology and Genetics (CING) will lead the healthcare-focused work of PHAROS-CY, Cyprus’ national AI Factory Antenna, supporting the development of responsible AI applications for medicine and biomedical research.

The initiative aims to give researchers, businesses and public organisations access to specialised expertise, quality datasets and high-performance computing infrastructure to turn data-driven ideas into practical solutions.

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CING To Drive Healthcare AI Development

CING’s Bioinformatics Department will oversee the project’s health-focused activities, drawing on the institute’s experience in genomics, molecular diagnostics, biomedical research and health data management.

PHAROS-CY will provide access to advanced AI services, secure data environments, technical expertise and computing resources. Its work will span healthcare, sustainability, culture and language, while supporting skills development and collaboration between research organisations and businesses.

The healthcare stream will focus on applications addressing practical research and clinical needs, with an emphasis on scientific reliability, data security and responsible deployment.

Strengthening National And European Cooperation

CING will also coordinate PHAROS-CY’s cooperation and networking activities, building connections with research, healthcare, innovation and technology networks in Cyprus and across Europe.

The project aims to help organisations identify and access relevant services, infrastructure and opportunities, strengthening Cyprus’ capacity to develop and adopt AI technologies.

Data Protection And Responsible AI Governance

Legal compliance, ethical standards and responsible data management are central to the initiative. CING will contribute to measures supporting the protection of personal and sensitive information, transparency and compliance with European regulations.

These safeguards are particularly important in healthcare, where the adoption of AI depends on both the reliability of its outputs and public confidence in how data is handled.

Connection To Europe’s AI Infrastructure

PHAROS-CY is linked to Greece’s Pharos AI Factory and the wider European network of AI Factories and high-performance computing infrastructure. This connection will give participants access to expertise, existing datasets and models, training opportunities and European computing resources.

The Cyprus Institute coordinates the project in partnership with CING and other Cypriot research and innovation organisations.

€6 Million Project To Run Until 2029

PHAROS-CY will run for 36 months, from April 2026 to March 2029, with a total budget of €6 million, according to European Commission project data.

The initiative is funded by the European High Performance Computing Joint Undertaking (EuroHPC JU) and the Republic of Cyprus under grant agreement No. 101263007. The Deputy Ministry of Research, Innovation and Digital Policy is responsible for implementing the national funding scheme.

More information is available on the PHAROS-CY website and the Cyprus Institute of Neurology and Genetics website.

Hybrid vehicles continued to strengthen their position in Cyprus, accounting for 53% of passenger car registrations compared with 44% a year earlier. Petrol-powered cars, meanwhile, fell from 42.8% to 34.8%, while diesel fell from 8.5% to 8%.

Electric vehicles also lost ground, representing 4.2% of passenger car registrations, down from 4.7% in the same period last year.

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Commercial Vehicles And Buses Record Growth

Motor coach and bus registrations rose 48.5% in the first nine months of 2026 to 196, up from 132 a year earlier. September alone recorded a 74.2% rise, from 31 to 54 vehicles.

Goods vehicle registrations climbed 10.4% to 5,046 from 4,569. Light goods vehicles rose 8.8% to 3,970, while heavy goods vehicles increased 16.3% to 621. Road tractors gained 14.7% to 195, and rental goods vehicles advanced 20.9% to 260.

Despite the growth over the nine months, goods vehicle registrations fell 8% year on year in September, dropping from 634 to 583.

Mixed Results For Two-Wheelers And Specialist Vehicles

Moped registrations for vehicles under 50cc fell 35.9% to 109 in the first nine months of 2026, compared with 170 a year earlier. September saw an even sharper decline of 60%, with just six registrations.

Motorcycles and other mechanised cycles above 50cc moved in the opposite direction, rising 8% to 3,802 from 3,522. However, September registrations in this category fell 12.6% to 374.

Tractor registrations increased 3.8% to 246 over the nine months, despite a 16.1% September decline to 26. Registrations of other vehicles, including road rollers, mobile cranes and specialised vehicles, rose 30.4% overall, although September figures dropped 29.3%.

Hybrid Vehicles Strengthen Their Position

The figures highlight the growing share of hybrid vehicles in Cyprus’ passenger car market, alongside declining shares for petrol, diesel and fully electric vehicles. Commercial vehicle registrations also increased overall, although September declines in some categories point to a more mixed monthly performance.

The Cyprus Stock Exchange announced that trading in the shares of the first seven companies will remain suspended. These suspensions were already in place because of other outstanding compliance obligations, which remain unresolved.

Meanwhile, Rehub Plc’s bonds will continue to carry an “S” warning in the exchange’s trading tables and price bulletins. This designation alerts investors to the status of the securities and draws attention to the relevant trading notice.

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Regulatory Action Under Exchange Rules

Following the expiry of the deadline for submitting financial reports for the six-month period ended June 30, 2026, the exchange issued its announcement under the Cyprus Securities and Stock Exchange Law and the relevant listing rules.

Under this regulatory framework, listed companies must meet their reporting and disclosure obligations. Accordingly, the existing trading suspensions and warning designation will remain in place as specified in the announcement.