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Divergent Trends Define Cyprus Service And Transport Sectors In Q2 2025

Overview Of Mixed Sector Performance

The Cyprus turnover value index for services and transport in the second quarter of 2025 revealed a blend of robust growth and modest declines compared to the same period in 2024. According to data from the state statistical service (Cystat), key sectors exhibited varied performance profiles, reflecting both resilience and emerging challenges across the economy.

Substantial Gains In Accommodation And Food Services

Accommodation and food service activities led the upswing with an 11.7% increase, underpinned by a strong upswing in accommodation services at 13.9% and a 9.3% boost in food and beverage operations. This trend underscores the sector’s capacity to attract both local and international clientele, bolstering Cyprus’s tourism appeal.

Steady Momentum In Administrative And Support Services

Administrative and support service activities improved by 7.2% overall. Notably, the rental and leasing segment rose by 7.8%, while travel agency and tour operator services increased by 4.9%. Complementing these figures, security and investigation operations surged by 11.4%, and office administrative support grew by 9.6%, indicative of growing business operational needs and corporate confidence.

Emerging Trends In Digital And Information Services

The information and communication sector advanced by 4.4%, with publishing and programming and broadcasting growing by 5.2% and 3% respectively. Telecommunications and related IT services also reflected moderate gains, with computer programming and allied activities seeing a 3.4% increase, while information service activities surged by 17.3%, signaling robust digital transformation across the economy.

Professional And Technical Service Sectors

Professional, scientific and technical activities recorded a 3.6% rise. Within this domain, legal and accounting, management consulting, and advertising services experienced modest yet significant growth, while sectors such as architectural and engineering, and motion picture and sound recording saw slight declines of 3.1% and 3.3% respectively.

Transport And Storage: Mixed Performance

The transport and storage sector delivered a 2.1% gain overall. Land transport rose by 5.7%, with water transport increasing by 4% and air transport modestly rising by 0.7%. Support functions including warehousing and postal courier services also reflected positive momentum, though real estate activities experienced a contraction of 1.8% in turnover compared to the previous year.

H1 2025 Sectoral Outlook

Analyzing the first half of 2025, trends maintained a similar pattern with accommodation and food service activities up by 10.9%, administrative and support services by 8.2%, and information and communication at 6.3%. Professional services improved by 4.1% while transport activities continued their steady progression at 2.1%, even as real estate faced a cumulative decline of 3.4%. These figures highlight both the sectoral dynamism and the nuanced challenges that policymakers and business leaders must navigate in a rapidly evolving economic landscape.

DCO Launches AI Challenge To Develop Water Management Solutions

The Digital Cooperation Organisation has launched an international artificial intelligence challenge seeking practical solutions to water-sector problems, opening the programme to innovators from Cyprus and other member states.

Cyprus Innovators Can Apply

As a DCO member, Cyprus is eligible for the Future Makers AI Challenge for Critical Sustainability. Startups, researchers, innovators and technology teams can apply with AI-enabled solutions for water management and sustainability.

Saudi Arabia’s Ministry of Environment, Water and Agriculture, the Research, Development and Innovation Authority, and King Abdulaziz City for Science and Technology are delivering the initiative with the DCO.

Focus On Water Efficiency And Resilience

Across DCO member states, the challenge targets operational problems that affect water systems. Priority is given to technologies that can improve efficiency while reducing waste, resource use and environmental impact.

Potential solutions include technologies that reduce water losses, lower energy consumption, support reuse and recycling, and strengthen the resilience of the wider water value chain.

From Innovation To Deployment

Future Makers is delivered through NexaBridge, the DCO’s open innovation platform connecting business challenges with technology teams and supporting promising solutions toward commercial deployment.

Selected teams will be able to develop and demonstrate their solutions, while successful participants could have an opportunity to test their technologies under controlled conditions in Saudi Arabia. Solutions could then be adapted for use across other DCO member states.

Opportunity For Cyprus

For Cyprus, the challenge is particularly relevant because limited water resources make efficient supply management a strategic priority. Local participation could provide innovators with a platform to develop and test technologies addressing a key economic and environmental constraint.

Eligible participants include innovators, researchers, startups and technology teams with AI-enabled solutions addressing the identified water-sector priorities. Applicants can also adapt existing expertise to the challenge or seek partnerships with teams from other countries.

Applications Close October 4

The initiative aims to move water-sector innovation from research and development toward practical deployment. Applications for the Future Makers AI Challenge for Critical Sustainability close on October 4, 2026.

Established to promote digital cooperation among member states, the DCO focuses on technology, innovation and digital transformation. Cyprus’s membership gives local businesses and researchers access to cross-border initiatives supporting technology-led solutions.

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