Limassol offices priced higher than London
The price of offices in Cyprus, particularly in Limassol are, in some cases, higher than London and Amsterdam, according to major technology companies operating in Cyprus.
This issue was presented as one of the barriers to further growth in the information technology sector (ICT), and more generally for investments, which have seen rapid growth in recent years.
During the discussion “Establishing Tech Island: Developing a Competitive Digital Economy for Cyprus” at the Cyprus Forum, the performance of the sector and the challenges facing its further development were discussed.
“The goal of transforming Cyprus into a technology hub is not a distant or unattainable objective,” said Deputy Minister for Research, Innovation, and Digital Policy Nikodimos Damianou, adding that the ICT sector has seen the greatest growth over the last decade with an average rate of around 10%, contributing to the diversification of the economic model. “We must focus on how to leverage it to ensure we maintain this momentum,” he emphasized.
According to Mr. Damianou, the key components are digital infrastructure, fast high-speed connectivity, data centres, a digitally educated workforce, an environment that supports a startup ecosystem, as well as a legal and regulatory framework that ensures and supports the sector’s growth.
Cumulative contribution of €5.6 billion to the economy
For his part, Christophoros Anayiotos, head of DEAL, a KPMG advisory firm, referred to a study assessing the impact of the sector on the economy in terms of gross value added (GVA), which includes ICT companies and part of the professional and scientific services sector.
“By this measurement, the sector makes a direct contribution to the Cyprus economy of €3.3 billion, or about 12% of the country’s gross value added,” he said, adding that when indirect effects on all sectors are included, the contribution reaches €5.6 billion.
Mr. Anayiotos also noted that the estimate is conservative, as it does not include technology companies such as financial technology (fintech) companies, which are classified in the financial services sector.
He also pointed out that, based on official statistics, 60% of employees in the sector are Cypriots, countering the perception that jobs in the sector are only for foreigners.
CEO of Payabl, Ugn? Bura?ien?, said that her company is struggling to expand its activities. “The cost of offices is actually higher than we pay in London and the Netherlands in some cases,” she said.
Mr. Anayiotos said that the issues of schools, public transportation, and finding affordable workspaces needed by the sector, and highlighted the issue of connecting higher education with the labor market..
Elena Protsaskova, Director of Jetbrains, stressed the need for stronger collaboration between universities and the tech industry to better prepare future talent for the workforce.
“The demand for innovation continues to escalate and requires more and more skills,” she said, adding that collaboration between universities and technology companies will enable them to prepare the new generation to be more competitive in the job market.
Elena Grigoryan, CEO of My Games, which has one of its centres in Cyprus, referred to the progress of the sector and the advantages that Cyprus offers, which have made it an attractive destination, such as tax incentives, double taxation agreements, and the issue of employee spouses moving to Cyprus.
AKEL MP Aristos Damianou acknowledged the progress of the sector and emphasized the need to monitor the implementation of legislation established by the legislative authority and called for a reduction in bureaucracy. He described the rental prices in Limassol as “outrageous” not only for offices but also for housing purposes. He also stated that it is “shocking to ask businessmen to run here and there to create schools because the economy itself cannot create the infrastructure.“
Copy write, Cyprus Property News.