The professional services sector remains one of the most important pillars of the Cypriot economy, significantly contributing to its growth. Limassol serves as the main hub for financial, legal, and technological services, attracting foreign investments and strengthening Cyprus' position as a business hub in Europe and the Middle East. For this reason, it has been informally given the title of Cyprus' economic capital, according to the Vice President of Services of the Limassol Chamber of Commerce and Industry, Mr. Elias Neocleous.
Mr. Neocleous stated in "Entrepreneurial Limassol" that the development of new sectors, such as financial technology (FinTech), legal technology (LegalTech), and regulatory technology (RegTech), creates opportunities for innovation and diversification. At the same time, the growing need for digital transformation and intense international competition require businesses to adapt quickly. Strict regulations, such as those concerning cybersecurity and data protection, make continuous training and investment in new technologies essential.
The Vice President of Services of the Limassol Chamber, emphasized that service providers are in a unique position that offers significant growth prospects, provided they continue to evolve and adopt modern practices with innovation in mind.
The Services Sector in Limassol
Mr. Elias Neocleous explained that Limassol encompasses a wide range of business activities in financial, legal, accounting, maritime, consulting, technological, and professional services. At the same time, it hosts prominent companies in the fields of information technology, tourism, real estate, and education, making it one of Cyprus' key business hubs.
He emphasized that while all Cypriot cities are developing in line with the economy’s evolution, Limassol has additional factors that enhance the growth of the services sector. “Limassol has always been an outward-looking city. Its coastal location and hospitality have always been its trademark. Additionally, it has historically provided support to our fellow citizens, as seen after the Turkish invasion. Its unique cultural character has further developed, continuing to attract companies from Cyprus and abroad,” said the Vice President of Services of the Limassol Chamber. “Due to its dynamism, Limassol can now be considered the business capital of the Eastern Mediterranean,” he added.
Challenges for the Services Sector
The impact of sanctions due to the war in Ukraine has undoubtedly affected the services sector. Many providers have had to seek new markets and products to maintain their viability. “We cannot ignore the effects of these external factors, which particularly impact a small economy like Cyprus,” noted Mr. Neokleous. Nevertheless, he remains optimistic about the sector’s prospects, as Cyprus maintains strong international relations and invests in digitalization and technology.
Referring to the introduction of a 15% corporate tax for large multinational companies, Mr. Neokleous noted that its impact will depend on how it is implemented. He emphasized that it should be integrated in a way that allows Cyprus to remain a tax-attractive destination and continue to attract companies rather than deter them.
The Role of Technology and Innovation
Although we live in a digital era, the growth of the services sector is still based on the provision of high-quality services, according to Mr. Elias Neocleous. “Companies that invest in technological tools, such as artificial intelligence and data analytics, can significantly improve their efficiency through process automation,” he explained. He predicted that technological development will make these practices the standard operating model for businesses seeking further growth.
He also highlighted that globalization in service provision has changed the industry’s operational model, enhancing cross-border collaborations. Cyprus, due to its high level of professional expertise and the tax incentives it offers, can become a magnet for businesses from the Middle East, India, and China.
The Contribution of the Limassol Chamber
According to the Vice President of Services, the Limassol Chamber actively supports businesses in the services sector by offering strategic guidance, training programs, and access to networking opportunities. At the same time, it mediates between businesses and government authorities, facilitating access to national and European funding programs.
Mr. Neocleous concluded by emphasizing that sustainability and social responsibility are key factors for business success. “Companies that incorporate these values not only attract clients but also contribute to creating a better business and social environment.”
