Tech & Innovation Summit: On the path to a digital economy

At the “Cyprus: The New Global Tech & Innovation Hub Summit,” which took place at the Parklane Hotel in Limassol, hundreds of delegates had the chance to hear insights from experts on the potential of Cyprus as a tech hub. Among the various presentations, a panel framed a discussion around governmental policies and the private sector’s vision for creating a digital economy, moderated by Marios Tanousis, CEO of Invest Cyprus, the country’s investment promotion agency.

“When you are thinking about relocating, I’m sure you are thinking about infrastructure,” said Niki Ioannou Chandriotou, Head of Business Solutions at Cyta Business, the country’s largest telco.

Cyta had invested heavily, she said, in infrastructure and by the end of 2023, 100% of all urban and semi-urban areas with fiber cables. She also mentioned that for a second consecutive year, the telco was awarded by Ookla as the fastest mobile network in Europe. Cyprus is also the first country in Europe with 100% 5G population coverage. More than that, she went on, CYTA has created a hub of connections, with three satellite stations, so when companies relocate to Cyprus are linked to the entire world. “Yes, we are an island, but we are connected,” she stressed. Finally, she noted that the country hosts data centres, and CYTA is creating one of the largest data centres in the area.

On his part, Kyriacos Kokkinos, the former Deputy Minister for Research, Innovation and Digital Policy, mentioned that Cyprus is one of the best countries in the world to live, work and do business in and the long-term plan of the Government’s called “Vision 2035” that aims to build a digital economy is slowing becoming a reality. “Through technology, we want to develop a sustainable development model driven by research, innovation and technological advancement,” he noted.

He mentioned that the Government consciously put a plan to add another pillar to the economy besides services, tourism and shipping, and people are at the centre of the strategy to build up technology into a driving force of the economy. “We are not a tax paradise; it’s our people, our extroversion and our determination that is the key differentiator,” he stressed by way of explaining the country’s strategy to attract tech companies and talent. “Our propulsive fuel is our people,” he reiterated. Highlighting some key aspects in terms of talent, he referred to the high-quality professionals that are in the country and the high number of university graduates. Finally, he said, Cyprus, in the past few years, has jumped to the 10th position, the only southern European country, on the European Innovation Scoreboard 2022, which reflects the hard work that’s been done in the innovation and research sector.

Valentinos Polykarpou, Chairperson at non-profit TechIsland, touched upon the fact that the GDP contribution of the tech sector to Cyprus GDP has significantly increased as a result of the collaboration between the public and private sector. At the same time, some 80% of the money spent on salaries remain in Cyprus, which adds to the real economy. He briefly mentioned that tax regimes including corporate and income tax, reduce the costs to employers and allow employees to get salaries corresponding to the value they offer. In terms of the New Naturalization Framework for TNC Professionals (the ability to apply for citizenship within 4-5 years under certain conditions), he mentioned that if the law passes, it will change the game for Cyprus. “We are feeling confident that we are going to do it,” he said.

Speaking specifically for TechIsland, a non-profit that was established in 2021 with the specific aim to turn Cyprus into a world-class destination for tech talent, bringing together more than 260 companies that employ over 18,500 locally, he highlighted the initiative to create a novel digital Cyprus tech ecosystem map, the first of its kind, which provides granular data on every aspect of the local ecosystem. Finally, he mentioned that the organisation has a project in the pipeline that would provide companies with a comprehensive guide on various salaries, across all positions, in the Cyprus tech sector, which will be unveiled by the end of 2023.

Kyriacos Stylianides, Managing Director at Supernova Consulting, a consulting, technology, and outsourcing services firm, discussed the various opportunities for tech companies relocating to Cyprus, including strategic alliances with local companies for new product development, utilising tech industry associations, like TechIsland, for knowledge sharing, teaming up with local organisation for EU and National Funding, and proximity to regional and growing markets. He went on to highlight the lessons learned from other success stories. In Cyprus, the shipping industry grew to become a global force, contributing to 7% of the country’s GDP – the collaboration between the public and private sectors was instrumental in the growth of the shipping industry. In his closing remarks, he relayed a message of collaboration, stressing that technology is all about making lives better.

Vasilis Zertalis, CEO of financial services firm Prospectacy, said that he didn’t share the opinion of the previous speakers in that the development of the Cyprus tech sector was a recent development but rather started more than a decade ago when several international companies chose Cyprus as their headquartering destination. The challenges that were present back then are still there, he said, although there have been improvements, facilitated by public policy, particularly to handle the influx of arrivals in the past few years. Finally, he mentioned that there were a lot of companies in Cyprus that can help make the experience of moving to the island as smooth as possible.