“At Deloitte, among the most defining changes we expect are the completion of our digital transformation and the further expansion of artificial intelligence applications in our work,” Deloitte Cyprus CEO Pieris Markou explains, noting that Deloitte’s global program, WorldImpact, is at the centre of the strategy and focuses on access to education, addressing climate change, promoting equality, diversity and inclusion, and addressing the biggest challenges of local society.
At the same time, in an interview with InBusinessNews in the context of the IN Business Forecasting 2026 series of interviews, he notes that the professional services sector in Cyprus is expected to continue its growth in 2026, continuing to be one of the main pillars of the Cypriot economy.
"However, as is the case in every sector, we face challenges that require immediate handling, such as the ever-increasing regulatory framework, the completion and implementation of the tax reform, the framework for foreign investment, the strengthening of professionalism, the wider use of modern technology and the exploitation of new opportunities," he adds.
Implementation and implementation of reforms in 2026
How do you think the Cypriot economy will perform in the new year and what are its prospects? What do you consider to be the biggest risks and how can they be addressed?
The Cypriot economy is expected to maintain the positive trajectory it had in 2025 in 2026 also, with a growth rate of around 3.5% of GDP, remaining above the EU average. Despite the ongoing geopolitical challenges in our region, the domestic and external economic environment looks promising. Our public finances remain strong, the budget is in surplus and the outlook is favourable. This growth will be supported by controlled inflation, low unemployment levels, and the continued implementation of public digital transformation and green transition projects.
2025 was a period of development and promotion of reforms, the implementation of which is expected to continue in 2026. The government's efforts to address the long-standing structural problems affecting the economy have progressed, and we are already seeing structural reforms being promoted for modernisation in the public sector. We must not be complacent, and we must always keep in mind the need for fiscal prudence and maintaining a surplus fiscal balance by reducing public debt, combating bureaucracy, controlling energy costs, and strengthening innovation, start-ups and new sectors of the economy that will bring further growth.
How do you anticipate that your company's sector of activity will develop in 2026, what are the biggest trends/changes you expect to occur and what are the most significant challenges?
The professional services sector in Cyprus is expected to continue its growth in 2026, continuing to be one of the main pillars of the Cypriot economy. Despite the challenges of previous years, our sector has proven how resilient and flexible it is. Closing positively in 2025, we expect even better results for 2026.
However, as is the case in every sector, we face challenges that require immediate handling, such as the ever-increasing regulatory framework, the completion and implementation of the tax reform, the framework for foreign investment, the enhancement of professionalism, the wider use of modern technology and the exploitation of new opportunities.
At Deloitte, among the most defining changes we expect is the completion of our digital transformation and the further expansion of artificial intelligence applications in our work, for the benefit of our clients and our people. The growing need for digitalisation requires investments in new technologies and adaptation to digital solutions, such as the use of automation, control and compliance systems, and data analytics. The integration of advanced technologies will also lead to the improvement and creation of new services, which also requires the development of new skills through continuous training and upskilling, and the integration of new talents.
Developing, attracting and retaining talent in our industry is still a major challenge, as there is still an outdated view of our sector and there is a difficulty in attracting new people to our sector, while the overall demand for specialised personnel with digital and analytical skills is increasing. We are focusing on developing our human resources, and while maintaining quality, ethics and integrity, we continuously evaluate and adopt new technologies and sustainable solutions, remaining competitive in the changing business environment.
Due to the intense regulatory framework of our sector, with constant changes in national, European and international regulations, in matters of taxation, AML, ESG and others, increased complexity is created in our operations and cost created in their implementation. Regulatory compliance and transparency in our operations is essential and control is essential.
Changes in the economic environment also bring about the need for specialised advisory services. The complexity of the business environment has already increased the demand for specialised advice in areas such as taxation, cybersecurity, risk management, strategy, data analysis, ESG issues and many more, to which we are called upon to be ready to contribute. Deloitte is ready to offer differentiated services by sector of the economy, with teams formed to effectively support the specific challenges and opportunities faced by each sector. With specialised knowledge and experience, we ensure that the solutions we offer are targeted and efficient, helping our clients achieve their goals and grow their business.
Success depends on rapid adaptation, innovation and reform, to which Deloitte is committed to contributing positively. Deloitte is ready and equipped to continue to grow and provide high-quality services, closely monitoring developments and adapting to new challenges and opportunities.
A strong trend that seems to be taking hold in Cypriot business is that of acquisitions and mergers. Will we see it strongly in your sector as well?
Mergers and acquisitions (M&A), although not new to our economy, have been on the rise in recent years and are expected to continue. M&A offers businesses the opportunity to strengthen their market position, face increasing competition, and grow rapidly, allowing them to rapidly expand their activities, broaden their range of services, penetrate new markets, or gain easy access to innovative technologies and talent.
In our sector, acquisitions and mergers have been and still are constantly taking place. We, like the other large companies in our sector, are a great example, where we have moved forward with strengthened collaborations with our respective international networks. In our sector, we are now observing M&As between small companies, mainly abroad but also in Cyprus.
The global WorldImpact program is at the centre of strategy
What can we expect in terms of your organisation's development and expansion plans and strategy in 2026? What moves do you intend to make in this direction?
At Deloitte, our ability to adapt to the ever-changing business environment has been proven. We focus on technology, sustainability and our people, seeking to enhance the client and employee experience.
Deloitte Cyprus will continue to focus on strengthening its market leadership through a multi-dimensional growth and expansion strategy, aiming for sustainable development and focusing on corporate responsibility, contributing positively to Cypriot society. Deloitte's global program, WorldImpact, which aims for a better future for all, is at the heart of our strategy and focuses on four central pillars: access to education, addressing climate change, promoting equality, diversity and inclusion, and addressing the biggest challenges of local society.
We continue to invest in talent and technology, with an emphasis on attracting, developing and retaining human resources and integrating advanced technologies. We support innovation and expand our service portfolio into cutting-edge sectors, and focus on providing high-value-added solutions to clients, fully leveraging our experiences and global network. With respect for quality, ethics and integrity, we are steadily continuing towards the implementation of our strategic objectives, and look forward to further impacting businesses, their people and the wider society.
The new year is seeing the implementation of the tax reform, which is taking place 22 years after the previous tax reform. How do you anticipate that it will affect the Cypriot economy, businesses, and the attraction of foreign investments?
The tax reform, which comes after 22 years, is a crucial step for Cyprus and is expected to have significant impacts on the Cypriot economy in general, on businesses, households, investments with consequential impacts elsewhere also. From the perspective of Deloitte Cyprus, we see this reform as an opportunity, but also as a challenge, especially considering the large number of changes that came into effect on 1 January 2026, marking the beginning of a new chapter.
Although there are some gray areas in the overall reform of the tax framework and mainly in the powers granted to whoever is serving as Tax Commissioner at the time, we expect that the authorities will ensure that the necessary safeguards are in place so that these changes do not prove to be a brake on growth and entrepreneurship. At the same time, we expect that the changes will help households through the differentiation in the taxation of individuals but also through the broader changes in personal deductions and tax rates.
As for businesses, the impact of the reform is multidimensional, with the increase in the corporate tax rate creating increased costs for businesses but also, on a positive note, the abolition of the deemed dividend distribution, which allows the reinvestment of profits by companies without additional tax burden, improving their liquidity and capital adequacy.
Deloitte Cyprus is fully prepared to support businesses in this transition, providing specialized advice and practical solutions to understand and effectively adapt to the new tax data, ensuring compliance and capitalizing on the opportunities that arise.
(Source: InBusinessNews)
