Cyprus is entering a new phase in the development of its research and innovation ecosystem, with the focus shifting towards attracting more private investment and international talent and turning research into products, exports and wider economic activity, Research and Innovation Foundation (RIF) Director General, Theodoros Loukaidis, has said.
Speaking to the Cyprus News Agency (CNA) ahead of the 20th European Researchers’ Night and on the 30th anniversary of RIF, Loukaidis said Cyprus had made significant progress over the past three decades and was now looking to expand its international footprint.
“Today, 30 years later, we have an ecosystem which, with the support of RIF over the years, has improved its performance, ranks highly internationally and can further strengthen its competitiveness globally,” he said.
Cyprus ranks 25th among 139 economies in the Global Innovation Index, while its startup ecosystem is ranked 34th globally by StartupBlink, Loukaidis said.
The next challenge, he added, was to build on that progress and bring more success to Cyprus. Demand for RIF support has risen sharply, with 284 applications submitted under a recent call compared with about 60 for the same programme five or six years ago.
Public funding to leverage private capital
Loukaidis said Cyprus needed to increase public funding for research and innovation while using it to attract larger amounts of private capital.
Investment funds interested in Cypriot companies have become a more visible part of the ecosystem, alongside new support structures such as Plug and Play, he said.
RIF programmes BOOST and DISRUPT illustrate the approach. In DISRUPT, every €1 of public funding mobilised €1.2 in private investment, while BOOST generated twice as much private investment for every €1 of public funding.
The objective is to use public support as a multiplier, generating investment, productive activity and sustainable jobs, Loukaidis said.
Private funding is increasingly coming through business angels and venture capital, with some investment funds based in Cyprus and others from abroad. RIF is also seeking to raise the international profile of Cypriot startups and connect them with foreign investors.
He cited pharmaceutical company Medochemie’s investment in startup Theramir as an example of a strategic investment that could generate not only financing but also partnerships for developing products and reaching international markets.
Multinationals boost links with global markets
The growing presence of multinational and international ICT companies in Cyprus is another potential driver of the ecosystem, Loukaidis said.
Such companies bring access to international markets, expertise in developing globally competitive products and the capacity to mobilise larger amounts of private capital for research and development.
Their presence, as he said, can create opportunities for joint projects with Cypriot universities, research institutions and centres of excellence, while local companies can gain know-how, upgrade standards and develop new processes and products.
The aim, he said, is for Cypriot firms to become more competitive and expand from the domestic market to international markets.
AI: Cyprus aims to move beyond being a user
Artificial intelligence presents a particular challenge for a small economy competing with countries and companies with far greater resources, Loukaidis said.
“Cyprus can nevertheless target specific parts of the international AI value chain by using its data, infrastructure and expertise in areas where it already has an international presence, including shipping, financial and professional services”, he said.
The goal is not necessarily to develop complete AI products independently, but to convert local data and expertise into knowledge, intellectual property and components of internationally competitive products.
“The big challenge is not to end up simply adopting and using technologies produced elsewhere,” he said.
Loukaidis pointed to Pharos-CY, part of AI Factory Pharos, and an investment in a supercomputer in cooperation with NVIDIA. Ensuring researchers and innovative companies can access such infrastructure will be critical, he said, allowing them to develop models based on local needs with an international orientation.
Talent remains critical
Cyprus also needs to strengthen its talent base, both by attracting people from abroad and by redirecting existing talent into research, innovation and technology, with Loukaidis noting that young people should be encouraged to pursue science and technology while developing creativity, critical thinking and entrepreneurial skills.
RIF initiatives such as Research & Innovation Summer Internships and Accelerate Cyprus Talent (ACT) are designed to connect students with companies and potentially lead to permanent employment.
The skills gap is broader than science and engineering, he said. Cyprus’ video games industry, which he said generates around €3.2 billion in revenues according to a recent report, also requires people with backgrounds in arts, marketing and other disciplines.
He said shortages persist in digital technologies and the green transition, while AI could help improve productivity across the economy.
Tax and financial incentives to attract Cypriots from abroad, including through “Minds in Cyprus”, are useful but not sufficient on their own, Loukaidis said. Cyprus also needs an environment that makes it easier to establish and grow companies, access private finance and build international networks.
“Talent goes where there are opportunities for development, advancement and the conditions for success,” he said, adding that Cyprus should aim to become a connected regional hub.
From research to international markets
Loukaidis cited a number of companies as evidence that research-based businesses can grow from Cyprus into international markets.
NIPD Genetics, which started as a spin-off of the Cyprus Institute of Neurology and Genetics, developed diagnostic and prenatal tests with RIF support and private investment from Cyprus and abroad. It reached a valuation of €65 million, was acquired by a Swedish multinational and continues to operate in Cyprus, employing around 150 people and investing in R&D.
Blue Analytics, which combines AI with aquaculture, has received RIF support and raised around €6 million from a fund specialising in the blue economy. It already has a product on the market and is seeking further customers.
Silicon Dali, founded four years ago with €200,000 in RIF support, has exceeded €1 million in sales, employs 18 people, has opened an office in Spain and has customers as far afield as South Africa.
AI company Cleedee, which addresses recruitment challenges in hospitality, has received €500,000 from RIF and about €300,000 in private investment and is expanding into Greece and Austria. Loukaidis also cited Klidi, a financial-sector company, that recently raised €2.1 million in private investment.
Research funding has also generated international returns, he said. Two Cypriot female researchers working on cancer-related research were selected among 421 recipients of a highly competitive European Research Council programme. Each had received €100,000 in national support and subsequently secured €1.5 million, bringing €3 million in total to Cyprus.
New programmes
RIF is now designing its next programming period and plans to expand its funding tools.
New initiatives include PhD MINT, aimed at attracting doctoral talent; Accelerate Cyprus Talent; and Games Go Global, designed to help the Cypriot video games industry expand internationally. RIF also plans to strengthen research excellence through VISION ERC while continuing BOOST and DISRUPT.
The 20th European Researchers’ Night, which coincides with RIF’s 30th anniversary, will feature more than 75 exhibition stands and begin with visits by school students.
Loukaidis said the event reflected a broader change in Cyprus, where research and innovation were increasingly becoming part of the country’s economic and career landscape.
“It is no longer something that perhaps happens. It is something that happens in Cyprus,” he said.
(Source: CNA)
