Cypriot businesses are making real progress in innovation, with new products entering international markets, according to Research & Innovation Foundation (RIF) director general Theodoros Loukaidis.
However, he explained that while sectors such as defence technologies, biotechnology, and pharmaceuticals are gaining attention, investment levels remain below expectations.
In addition, he stressed that continued support and increased funding are essential to keep this momentum going.
Speaking to the Cyprus News Agency (CNA), Loukaidis acknowledged Cyprus’ mixed performance when it comes to innovation.
While the country has made strides, government and private investments remain lower than the European average, limiting the broader impact of these innovations.
Nevertheless, he pointed to a number of success stories. “We see that some of these enterprises, which have received funding, are already bringing products to the markets,” he said.
He added that “it will take more time for these companies to fully develop and mature their products.”
In time, Loukaidis believes, many of these businesses will begin to export their innovations abroad.
One of the programmes he highlighted is Co-Develop, which enables researchers and businesses to collaborate, developing tech solutions together.
Currently, 26 projects are underway, with 40 small businesses, two medium-sized, and two large enterprises working across fields like energy, agri-food, shipping, and IT.
While these projects are encouraging, Loukaidis also acknowledged the need for sustained support, both financially and through favourable policies.
“Cypriot businesses need support,” he said. He noted that “new interventions are being considered, with announcements expected soon on financial tools aimed at moving projects closer to full commercialisation.”
Although Cyprus has made some headway on the European Innovation Scoreboard, Loukaidis is realistic about the ongoing challenges.
The country’s Research and Innovation Strategy spending remains low, and its export of high- and medium-technology products lags behind.
He also pointed out that globally, there is a downward trend in investment funds, which adds to the difficulties Cyprus faces.
Nevertheless, the RIF is working to address these weaknesses through its programmes.
Loukaidis took a more positive note when discussing the Disrupt programme, which is Cyprus’ first mixed-financing initiative.
This programme, designed to boost innovation, has already provided €10.5 million in public funding to seven innovative companies, and it has attracted an additional €12.5 million from investment funds, both local and international.
“It is these kinds of programmes that will allow these businesses to scale up their operations, to market products in international markets,” Loukaidis said, expressing confidence that this will have a lasting impact on Cyprus’ innovation performance.
Despite Cyprus’ relatively small size, its innovation ecosystem is expanding. Loukaidis mentioned that in addition to supporting start-ups and scale-ups, the foundation has created programmes aimed at encouraging traditional businesses to integrate research and development into their operations.
This support has helped Cypriot businesses enter new markets. He cited examples in sectors such as defence technologies, cosmetics, food, pharmaceuticals, and sports. “These companies are bringing new products to markets, in areas where Cyprus was not expected to have potential a few years ago,” he said.
When asked about Mario Draghi’s report on innovation in Europe, Loukaidis agreed with its key findings, calling them “very important.”
The report highlights the fact that Europe, despite being a leader in research, lags behind regions like the United States and China when it comes to disruptive innovation and scaling up innovative firms.
“Europe can and needs more disruptive innovation, it needs more investment in innovative companies, scale-ups and technology companies to be able to address the gap that has been created between Europe and other continents,” Loukaidis explained.
He added that “it’s critical for the EU to function more effectively as a single market, as current regulatory challenges often hinder the ability of firms to operate smoothly across borders.”
Loukaidis noted that some of these same challenges exist in Cyprus, where regulatory barriers and a fragmented market can slow innovation.
However, the country is addressing these obstacles through its national research and innovation strategy for 2024–2026, which includes a focus on expanding the number of businesses involved in the Research and Innovation Strategy.
Another crucial aspect of fostering innovation in Cyprus is developing local talent. Loukaidis underlined the importance of linking education to the labour market, ensuring that young people in Cyprus have the skills and opportunities to innovate.
“We have great talents, we are giving them opportunities and we want to hear even more so that they can have even more opportunities through our programmes,” he said.
He highlighted several initiatives aimed at bridging this gap, including the ‘PhD in industry’ programme, which allows young researchers to work directly with companies, conducting cutting-edge research that aligns with the businesses’ needs.
Another initiative is the ‘Research in innovation internships’, which gives students the chance to work in innovative Cypriot companies during the summer months.
Loukaidis also pointed to several competitions aimed at younger audiences, designed to spark interest in science, technology, and innovation from an early age.
“We want to give students the opportunity to experience Cyprus research and innovation,” he said, noting that “the innovation ecosystem in Cyprus has grown significantly in the past decade.”
“Many of the companies within this ecosystem,” he believes, “will be future employers for these young people, giving them a chance to contribute to the country’s expanding innovation landscape.”
“With continued support and the right policy interventions, Cypriot companies are well-positioned to make their mark both locally and internationally”, Loukaidis concluded.
