Industry accounts for over 40% of the total exports of Cyprus, while employing 16% of the country’s workforce. Industry’s interactions with other economic factors of the country extend far beyond manufacturing, from raw materials and energy to business services and tourism. Therefore, the economic importance of industrial activities is much greater than suggested by the share of manufacturing in the Gross Domestic Product (GDP) of the country. Energy is the activity with the greatest contribution to the gross value added of the industrial sector, while, the production of food and beverages is the one with the largest share on employment. Industry’s contribution to the Gross Domestic Product follows a downward trend since the early ‘80s. A major problem of the sector is low competitiveness due to the small size of most industrial units, which adversely affects their ability to utilize advanced technology and management. Other problems arise from the relatively high labour costs and low productivity.
The Ministry of Energy, Commerce, Industry and Tourism aims at accelerating the rate of growth of the manufacturing sector and enhancing its competitiveness under free market conditions through:
- restructuring and support of the manufacturing industry and implementation of projects and schemes co-financed by European Funds
- attracting foreign investment
- strengthening existing and attracting and developing new high-tech industries
- providing stable, simplified and predictable regulatory framework
- ensuring access to energy and raw materials at affordable prices.
To improve the business and investment environment and reduce the average time needed to start a business, the Ministry established and operates the pioneer institution of One Stop Shop, which aims to accelerating and simplifying the process of setting up a business.
One Stop Shop offers to foreign and local investors the following services:
- Provision of information and guidance on business issues
- Registration of a Company
- VAT Registration
- Income Tax Registration
- Application for the issue of Residence and Work Permits
Foreign capital can play a major role as it contributes substantially to the production of high technology and expertise. Additionally, Cyprus’ membership in the European Union enables small and medium enterprises to participate in various programmes concerning industrial technology, professional training and product development, thus assisting the process of restructuring.
Industrial Areas are successfully used to accelerate the pace of industrial development. Their establishment created the necessary infrastructure and suitable environment to private initiative for immediate operation and use of industrial units at the lowest possible cost.
Today, there is a total of 13 industrial zones within which 900 industrial units are located and engaged in a wide spectrum of activities. The Government has allocated to these industrial enterprises appropriate land, on a long-term lease base.
Small and Medium-Sized Enterprises
Small and medium-sized enterprises (SME) represent 99.8% of the Cypriot enterprises, whereas the overwhelming majority of enterprises (93.4%) employ less than ten persons. SMEs are a key driver for growth, innovation, competitiveness and employment and they are the back bone of the economy of Cyprus.
The Ministry of Energy, Commerce, Industry and Tourism, recognizing the importance of SMEs has set SMEs policy among its key priorities. Within this context and having in mind the guidelines set by the European SME policy, the Government promotes the following actions for the development of SMEs in Cyprus:
- Measures to simplify procedures and reduce the administrative burden,
- Facilitation of access to finance,
- Provision of incentives and facilities for access to the internal market.
For further information:
Industrial Development Service
Tel.: 22 867238
Fax: 22 376493