To compete internationally, businesses must invest in innovation, raise productivity and turn research into commercially viable products. At the same time, companies that adapt fastest to new technologies may have an advantage over larger competitors.

That was the central message at the 19th Cyprus Innovation Awards and the Cyprus Research Awards 2025, held at Nicosia Municipal Theatre. Despite leading the EU in innovation activity among smaller businesses, Cyprus continues to face challenges in attracting private investment and turning research into economic growth.

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Strong Innovation Activity, But A Funding Gap

Giorgos Pantelides, chairman of the Cyprus Employers and Industrialists Federation (Oev), said artificial intelligence, robotics and digital technologies were making innovation essential to business competitiveness. For Cyprus, where the domestic market is limited, success depends on flexibility, quality and the effective use of technology.

According to the European Commission’s 2026 European Innovation Scoreboard, Cyprus rose from 15th to first place in the EU for innovation activity among small and medium-sized businesses. It also climbed from tenth to second in research and business cooperation.

However, Cyprus remains a moderate innovator, performing at 92.1% of the EU average, with weaknesses in venture capital and business spending on research and development. Bridging this gap is essential to help promising ideas reach the market.

Turning Research Into Commercial Success

Demetris Skourides, Cyprus’ chief scientist and chairman of the Research and Innovation Foundation (RIF), said the priority was to translate scientific knowledge into innovation and economic and social benefits.

Cyprus has made progress in securing European research funding, winning 17 European Research Council (ERC) grants in the current programming period, compared with 12 in the previous one. Successful applications by early-career researchers increased from two to five. With 5.1 ERC grants per million inhabitants, the country exceeds the European average of 4.2.

University of Cyprus researchers Maria Kalli and Myrofora Panayi secured a combined €3 million in European funding after previously receiving €100,000 each through RIF’s VISION ERC programme. The initiative illustrates how domestic support can help researchers compete for larger international grants.

Skourides also highlighted efforts to attract scientists working abroad through the Minds in Cyprus initiative. He said 8.3% of active researchers at Cypriot universities rank among the world’s top 2% of scientists, underlining the country’s research potential.

Public Funding Aims To Attract Private Investment

President Nikos Christodoulides said technology contributes approximately 15% of Cyprus’ GDP, while stressing that economic growth must translate into higher productivity, better jobs and greater competitiveness.

Between 2023 and 2026, RIF launched 95 funding calls worth €165 million, resulting in 575 contracts worth a combined €105 million. These programmes contributed to more than 700 new jobs and 187 cooperation networks linking businesses with research organisations.

RIF programmes also attracted more than €47.2 million in private capital between 2021 and 2025. Its Disrupt and Boost schemes provided €12 million in public support to 14 businesses, which secured an additional €16.5 million from private investors.

A new BOOST programme round is expected to open in early December, with an initial budget of €1.2 million. Eligible businesses could receive grants of up to €300,000, provided they have a binding agreement for at least €200,000 in private equity investment. The first deadline is expected to be April 9, 2027.

RIF is also consulting researchers and businesses on its 2028–2034 funding programmes, with proposed priorities including research commercialisation, private investment, infrastructure and skills development.

International Partnerships And Future Priorities

Cyprus is also seeking international partnerships to expand opportunities for its technology sector. Christodoulides highlighted cooperation with NVIDIA on advanced computing infrastructure, the country’s participation in the European AI Factories network through Pharos-CY, and the establishment of the Plug and Play innovation centre.

The government is preparing a national research and innovation strategy through 2033, focusing on areas including artificial intelligence, biotechnology, advanced digital technologies and clean technology.

Turning Innovation Into Economic Growth

Since their introduction in 2006, Oev’s innovation awards have recognised businesses applying new ideas across manufacturing, services, the primary sector and social innovation. The awards are now part of European SME Week.

Cyprus has demonstrated that its smaller businesses can innovate and its researchers can compete internationally. The next challenge is to turn these strengths into sustained private investment, commercially successful products and higher productivity.