- Investment activity in Cyprus remains robust, with nearly all firms investing and many planning to innovate, although overall sentiment is more cautious than the EU average.
- Companies are adopting advanced digital tools, including artificial intelligence, and adjusting supply chains to enhance resilience.
- Firms are increasingly taking action on climate, particularly through waste reduction and recycling, while the transition to stricter environmental standards is seen more as a challenge than an opportunity.
The European Investment Bank (EIB) released the EIB Investment Survey 2025, Cyprus overview, showing that Cypriot firms remain optimistic about their own business prospects despite geopolitical tensions and global trade disruptions. Supply chain pressures have eased considerably as firms increased inventories and diversified import sources, allowing much easier access to commodities and raw materials than a year ago.
According to the survey, 94% of Cypriot firms invested in the past financial year, up from 84% in 2024 and higher than the EU average (86%). More firms also expect to increase investment in the current financial year (10%), outpacing the EU average (4%). Investment levels remain strong across all sectors, with at least 92% of firms investing.
“Cypriot firms continue to invest, digitalise and strengthen their resilience, even in a challenging global environment. Their growing use of AI and sustained commitment to innovation are clear signals of a private sector that is forward-looking and adaptable. The EIB stands ready to support companies in Cyprus as they innovate, upgrade and contribute to Europe’s competitiveness,” said EIB Vice-President Marek Mora
The survey shows that Cypriot firms are among the strongest international traders in the EU, with 81% engaged in cross-border activity. Logistical pressures have eased, and only 20% now report difficulties in accessing raw materials (down from 41% last year). Still, many firms remain attentive to tariff changes and new regulatory requirements.
Digitalisation and AI adoption continue to expand: 23% of firms make systematic use of generative AI tools, mainly for internal processes (75%), product development (41%) and customer service (39%). Half of all Cypriot firms (50%) are investing in new products, processes or services, well above the EU average (32%).
“The investment survey offers a clear picture of how firms in Cyprus and across Europe are adapting to technological, geopolitical and climate pressures. For Cyprus, the challenge now is to turn the green transition from a perceived risk into a long-term opportunity for innovation and competitiveness. The survey helps policymakers understand where support can have the greatest impact,” said EIB Chief Economist Debora Revoltella.
On climate issues, Cypriot firms remain less concerned about physical climate risks than their EU peers (60% vs 68%), and more than half (52%) believe they will be largely unaffected by stricter environmental regulations. While 69% have taken some action to reduce emissions—mainly through waste minimisation and recycling—only a minority have carried out energy audits (44%) or developed adaptation strategies (10%).
Investment barriers persist, particularly shortages of skilled staff (89%), high energy costs (87%), future uncertainty (84%) and labour regulations (82%). Infrastructure challenges are more pronounced in Cyprus than in the EU, particularly regarding transport (74%) and digital networks (70%). Access to finance has improved significantly, with the share of financially constrained firms falling to 6.8%, the lowest level since 2019.
Cyprus also stands out for gender balance: 42% of firms have at least 40% women in senior roles, while 22% have majority female ownership—both well above EU averages.
For more information on the EIB Investment Survey and to access the full Cyprus overview, visit https://www.eib.org/en/publications/20250218-econ-eibis-2025-cyprus
Background information
About EIB
The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. The finances investments in eight core priorities that support EU policy objectives: climate action and the environment, digitalisation and technological innovation, security and defence, cohesion, agriculture and the bioeconomy, social infrastructure, a stronger Europe in a more peaceful and prosperous world and Europe’s capital markets union.
The EIB Group, which also includes the European Investment Fund (EIF), signed nearly €89 billion in new financing for over 900 high-impact projects in 2024, boosting Europe’s competitiveness and security.
Approximately half of the EIB's financing within the EU targets cohesion regions, where per-capita income is below the EU average, while almost 60% of annual EIB Group investments support climate action and environmental sustainability.
Since the first operation in 1981, the EIBG Group has invested over €5.5 billion in Cyprus and remains a key partner in the country’s sustainable growth— further underlined by strengthening its local presence and leadership. The bank’s priority sectors in Cyprus are energy security, affordable housing, SMEs and innovation, water and climate resilience.
Read more about the Group’s activities in Cyprus here.