Yiangos Hadjiyiannis: Higher education sector close to saturation – Ambitious plans for CIM

Expressing concern about the potential for mergers in the higher education sector due to market saturation in recent years, Yiangos Hadjiyiannis, General Director of CIM-Cyprus Business School, shared his outlook in an interview with InBusinessNews as part of the "IN Business Forecasting 2025" series.

Given this situation, he urges the government to provide the necessary tools to facilitate further mergers and acquisitions across all sectors of the economy, emphasising that many Cypriot businesses are facing sustainability challenges.

Commenting on the overall state of higher education in Cyprus, Hadjiyiannis observed a significant slowdown in student enrollment growth in recent years, despite a rapid increase in the number of institutions, which has occurred without a comprehensive strategic plan.

As a result of these developments, he notes that competition is now extremely fierce, which, according to him, is also affecting the quality of the educational programs offered.

Additionally, Hadjiyiannis pointed out that "the anticipated expansion of foreign universities through branches in Cyprus, as well as the opening of the Greek market to private universities, could significantly impact the market dynamics and create further challenges for existing institutions."

Regarding CIM’s plans, Hadjiyiannis revealed, “Following the unprecedented response from Cypriot and international businesses to our collaboration with Cambridge Judge Business School, Executive Education, we have ambitious growth plans both in Cyprus and regionally.”

Economic outlook for the coming year

How do you expect the Cypriot economy to perform in the new year? How optimistic are you about its prospects?

The year 2024 was a very positive one for Cyprus in terms of economic growth. Most sectors performed exceptionally well, with a very low unemployment rate. Notably, the tourism sector recorded record-breaking figures in both arrivals and spending.

Furthermore, by the end of 2024, inflation had reached its lowest levels in the past three years, ensuring a gradual reduction in interest rates, as the Eurozone target of 2% inflation has been achieved.

The prospects for 2025 are highly optimistic. A further reduction in interest rates will greatly benefit households and businesses by increasing their purchasing power, especially considering that Cyprus has one of the highest levels of private debt in Europe.

With lower interest rates, more disposable income will be available, which in turn will stimulate further economic growth.

Key risks and areas of concern

What do you see as the greatest risks to the country’s economy, and what should be prioritised to ensure continued growth?

The Cypriot economy, being very small, is flexible but also highly susceptible to regional crises.

The fact that major European Union economies are not experiencing growth and are at risk of recession is problematic and could have a negative impact on Cyprus. Moreover, there is a socio-economic imbalance among citizens, which means targeted support measures must be implemented to protect vulnerable social groups.

Competitiveness and productivity indicators remain a significant challenge for the Cypriot economy. Additionally, the large public wage bill, which is not linked to performance, is a long-standing issue that requires immediate resolution.

Accelerating digital transformation is crucial, as Cyprus is already lagging behind its targets in this area.

Finally, the high cost of the green transition is a pressing concern for both citizens and businesses. The EU’s 2030 targets are already considered unrealistic, highlighting the need for urgent action and planning.

Enhancing Cyprus as an attractive destination for foreign investments

What should Cyprus do to become an even more attractive destination for foreign investments? How important are these investments for the economy?

The past decade has been exceptionally important for the development of the Cypriot economy through foreign investments. The geopolitical circumstances, including the war in Ukraine and the conflict in Gaza, have had a positive impact on attracting investments, as Cyprus offers an ideal environment for investors by providing security, stability, multiple tax advantages, and a highly skilled workforce.

On the other hand, Cyprus is also a victim of its own success. A gap has emerged between local and foreign businesses, as many Cypriot companies struggle to attract talent as easily as foreign firms, which have greater financial strength.

To further enhance its attractiveness, Cyprus must focus on maintaining stability, improving infrastructure, offering competitive incentives, and supporting local businesses to ensure a balanced and sustainable economic environment. Foreign investments are crucial for the economy, as they bring capital, expertise, and job creation, driving long-term growth.

Regarding your company's field of operation, how do you expect it to perform in 2025? Are there any issues you are concerned about?

The higher education sector in Cyprus is currently at a saturation point. After approximately 15 years of continuous growth and a rapid increase in student numbers, primarily Cypriots and Greeks, we have seen a significant slowdown in student growth over the past 2–3 years, while the number of institutions has increased sharply without a comprehensive strategic plan.

As a result, there is now intense competition, which unfortunately affects the quality of the programs offered.

Additionally, the potential expansion of foreign universities through branches in Cyprus, along with the opening of the Greek market to private universities, may significantly impact market dynamics and create further challenges for existing institutions.

What are the major trends/changes you expect in your field, and what are the most significant challenges?

The rapid development of artificial intelligence and its integration into daily life is certainly having a significant impact on higher education.

Traditional learning and teaching methods must align with new technologies, and students’ skills need to be modernised so they can meet the labour market demands for the next 5–10 years.

Furthermore, an increasing number of students are seeking distance learning options so they can study from their own space and adjust their schedules to suit their personal needs.

A strong trend in Cypriot business seems to be mergers and acquisitions. Do you expect to see this trend in your sector as well?

It is very likely that mergers will occur in our sector, especially considering that, as I have already mentioned, the market is saturated, and no significant changes are expected.

The government is working on plans to promote mergers and acquisitions and must urgently provide the necessary tools to facilitate further consolidation across all sectors, as many Cypriot businesses are facing sustainability issues.

What can we expect in terms of your organisation's plans and growth strategy for 2025? What steps do you intend to take in this direction?

In our 47th year, we will continue to strengthen our position as the leading Cypriot business school, offering the highest possible employment rate and return on investment for our students.

Regarding academic programs, we will place special emphasis on our new E-MBA, which has significant growth potential.

As for our collaboration with Cambridge Judge Business School, Executive Education, following the unprecedented response from both Cypriot and foreign businesses, we have ambitious expansion plans both in Cyprus and the wider region.