Office rental prices in Cyprus, especially in Limassol, have surpassed those in cities like London and Amsterdam, according to prominent tech companies operating on the island. This has been identified as a significant barrier to further expansion in the rapidly growing Information and Communication Technology (ICT) sector.

During a panel discussion titled "Establishing Tech Island: Developing a Competitive Digital Economy for Cyprus" at the Cyprus Forum, industry leaders examined the sector’s progress and challenges.

Nikodimos Damianou, Deputy Minister of Research, Innovation, and Digital Policy, expressed confidence that Cyprus is well-positioned to become a tech hub. He pointed out that ICT has been the fastest-growing sector in the country over the past decade, with an average annual growth rate of 10%, contributing significantly to economic diversification.

Damianou emphasized the need to sustain this growth by focusing on key areas such as digital infrastructure, high-speed connectivity, data center, a skilled workforce, and a regulatory framework that fosters further development.

Christoforos Anagiotos, head of KPMG’s consulting division DEAL, shared insights from a study on the ICT sector's economic impact, noting that it contributes €3.3 billion directly, or around 12% of Cyprus's gross value added (GVA). Including indirect contributions, the total impact rises to €5.6 billion.

Anagiotos also emphasised that 60% of the sector's workforce consists of Cypriots, challenging the misconception that it predominantly creates jobs for foreign workers.

Other speakers highlighted concerns over high rents in Limassol, affecting both office spaces and housing. Elena Protsaskova, Director at JetBrains, underscored the importance of stronger partnerships between universities and the tech industry to better prepare future talent. Meanwhile, Elena Grigoryan, CEO of My Games, noted the shortage of schools for expatriate children and the limited availability of office space as obstacles to growth.

Une Bouratsine, CEO of Payabl, offered a striking example, mentioning that in some cases, office rental costs in Cyprus can exceed those in London or the Netherlands, further complicating the sector’s expansion.

CNA