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IMF Advises Cyprus Against Taxing Data Centres And Cryptocurrency Mining

by THEFUTURE.TEAM

In its latest economic assessment of Cyprus, the International Monetary Fund (IMF) has issued a strategic recommendation urging the Cypriot government to avoid imposing taxes on data centres and cryptocurrency mining. The IMF’s advice is rooted in a broader vision to position Cyprus as a hub for technological innovation and digital economy growth, rather than stifling these nascent industries with potentially burdensome taxes.

The IMF’s analysis underscores the importance of data centres and cryptocurrency mining as critical components of the digital economy, which Cyprus is increasingly looking to develop. Data centres serve as the backbone of the digital infrastructure, supporting everything from cloud computing to the storage and processing of vast amounts of information. Similarly, cryptocurrency mining, although controversial in some circles due to its environmental impact, represents a growing sector of the financial technology industry that has the potential to attract significant investment.

By advising against taxation, the IMF highlights the potential risks of discouraging investment in these industries at a time when Cyprus is seeking to diversify its economy and reduce its reliance on traditional sectors such as tourism and real estate. The IMF’s position suggests that premature or excessive taxation could deter international companies from establishing data centres in Cyprus or engaging in cryptocurrency mining operations, thereby missing an opportunity to position the island as a leader in the digital economy.

Instead, the IMF advocates for a regulatory environment that encourages innovation and investment. This approach includes creating incentives for companies to establish operations in Cyprus, offering support for research and development, and ensuring that the regulatory framework is flexible enough to adapt to the rapidly evolving nature of the technology sector.

For Cyprus, which is already positioning itself as a business-friendly jurisdiction with favourable tax policies, the IMF’s recommendation aligns with the broader national strategy of attracting foreign direct investment and fostering economic growth. The island nation, with its strategic location, robust legal framework, and skilled workforce, has the potential to become a regional hub for digital industries, provided that the right policies are in place.

Only 1% Of Cyprus Farms Use Precision Farming Technologies

by THEFUTURE.TEAM

Cyprus remains one of the European Union’s least digitised agricultural economies, with just 1% of farms using precision farming technologies in 2023, according to Eurostat.

The findings come as the EU continues to encourage the adoption of digital tools aimed at improving agricultural productivity, efficiency and sustainability.

Internet Access Expands, But Digital Uptake Lags

Internet access has improved across the bloc, although adoption remains uneven. Eurostat found that 43% of EU farms had internet access in 2023, with northern and central European countries leading the way.

Denmark, Germany, Slovakia, Latvia, the Czech Republic and Austria all reported internet access rates above 90%.

Greater connectivity, however, has not translated into widespread digital adoption. Farm management information systems, which help farmers manage day-to-day operations, were used by only about 11% of EU farms. France was a notable exception, with around 60% of farms using the technology.

Precision Farming Concentrated In Larger Operations

Robotics adoption also remained relatively limited, with only about 7% of EU farms using robotic technologies. Overall, around 18% of farms with utilised agricultural area employed at least one precision farming technology or practice in 2023.

These included robotics for plant protection, band spraying, variable-rate application, precision crop monitoring and soil analysis. Despite representing fewer than one in five farms, these holdings accounted for around 44% of the EU’s utilised agricultural area.

The figures suggest that precision farming remains concentrated among larger agricultural businesses, where investment in digital technologies is typically easier to support.

Cyprus Lags Behind EU Leaders

Luxembourg, Finland and Estonia recorded the highest shares of utilised agricultural area managed by farms using precision farming technologies, each exceeding 75%.

At the other end of the ranking, Cyprus recorded just 1%, while Greece and Romania reported between 10% and 15%. The results indicate that Cyprus remains at an early stage of digital adoption in agriculture, even as precision farming becomes more widespread across parts of the European Union.

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