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A growing number of Cypriots believe the island is ripe for starting a business—but fear of failure is still holding many back, according to the National Report on Entrepreneurship in Cyprus 2023/2024, released Tuesday by the Centre for Entrepreneurship at the University of Cyprus.
The report is part of Cyprus’ participation in the Global Entrepreneurship Monitor (GEM) for the eighth year running—a worldwide research project offering a snapshot of how entrepreneurial activity is evolving in each participating country.
According to the findings, 39.8% of adults in Cyprus believe there are good opportunities to start a business—up sharply from 26.8% the previous year. Even more (60.5%) say they have the skills to do so, a figure well above the European average. But more than half—53.3%—say they’re held back by fear of failure.
That reluctance is “a common hurdle,” said Minister of Energy, Commerce and Industry George Papanastasiou, who welcomed the report’s findings. “Those who fail are usually the ones who either don’t take enough risks—or take too many. The key is calculated risk,” he said.
Entrepreneurship on the Rise, but With Caveats
The report shows encouraging signs that entrepreneurial energy is gaining traction. Early-stage entrepreneurship in Cyprus, a metric known as the TEA index, reached 11%, up from 8.3% the previous year and higher than the EU average of 9.2%.
Established business ownership also saw an uptick, with Cyprus now ranking sixth in Europe for businesses operating longer than 42 months.
Still, fear of failure isn't the only stumbling block. According to the report, Cypriots are less likely than other Europeans to believe that starting a business is easy, and many feel that government programs and red tape make it even harder.
And while 66.9% of Cypriots know someone who owns a business, far above the EU average of 52.1%, that doesn’t always translate into action.
Gender & Age Gaps Persist
The report also sheds light on who is taking the entrepreneurial leap, and who isn’t. Young adults aged 18–34 are the most likely to start a business, with a rate of 14.4%, compared to just 5.8% for those aged 35–64. Men are also far more active than women in the startup space: 14.5% versus just 4.9%, though the gender gap is slightly narrower than last year.
Asked what motivates them to launch a business, 85.4% of aspiring entrepreneurs cited the desire to build wealth, 65.5% said they want to earn a living, while 39.7% hoped to “make a difference.” About one in four said they were carrying on a family tradition.
Ministry Action & Policy Shifts
Papanastasiou highlighted the ministry’s ongoing work to boost Cyprus' business environment, including €362 million in grants to support companies through 2027. A new round of entrepreneurship grants—worth €20 million—is already underway, he said.
He also pointed to the government's strategic focus on boosting industrial competitiveness and innovation, particularly by harnessing technology and leveraging EU funds such as the Recovery and Resilience Mechanism.
"We want to make Cyprus a land of flexible and tech-savvy industry," he said, adding that the green and digital transitions offer major opportunities for local businesses.
What Needs to Change
Despite the positive trends, Cyprus still lags behind in key areas such as government support for entrepreneurship, access to finance, and market openness. The report’s authors recommend several steps to improve the ecosystem:
- Introduce financial literacy into school curricula
- Train educators in entrepreneurial thinking
- Support startup development through mentorship, especially for women and vulnerable groups
- Provide guidance on digital strategy and tools
- Offer tax incentives for investment in innovation
The report also calls for closer ties between universities and the private sector, more government funding for innovation, and the creation of a national mentor network to guide young entrepreneurs.
