We want to build on the technology sector momentum, on the strength of the economy and on our elevated geopolitical role, and solidify Cyprus as a hub, not just for technology, but also for innovation, for skills and for knowledge, Deputy Minister for Research, Innovation and Digital Policy, Nicodemos Damianou, said on Thursday, in his presentation during the Digital Agenda Cyprus Summit held in Nicosia.
He added that the Cypriot research and innovation ecosystem was ranked two places higher this year on the Global Innovation Index, taking 25th place globally, having currently six times more startups than 2020, with approximately 100 new startups every year, while was awarded first prize by the EU Commission at the European Digital Connectivity Awards of 2025 for the nationwide project of rolling out gigabit connectivity in non-urban areas, covering 100% of the population with high-speed gigabit Internet.
According to the Deputy Minister, the pace and level of change that is happening is forcing governments to think technology across their policies and strategies, but also in everyday communication.
‘National digital power is no longer only about military power. It is a battle for semiconductors, for energy, for the rare and critical earth minerals that will be needed or are needed for the manufacturing process and this leads to a race for AI investments’, he continued.
He referred in this context to the Stargate project that US President Donald Trump announced when he took office, which will use $500 billion of investment to get the country to 10 gigawatts of data centre capacity by 2029.
He added that the situation in China is very similar, the main difference being that the US is funding that growth essentially with private money while China is doing it with public money.
As far as the EU is concerned, he said that the European Commission announced the intention to build five or six AI gigafactories, starting hopefully from next year, but is still struggling to find a way to make this growth sustainable, to draw private investments.
He added that the battle is quite similar in terms of talent, as, despite the fact that the EU has 30% more researchers in AI, it has to deal with a huge brain drain issue, while a similar situation applies to startups, with a lot of them being launched in Europe, but only 8% of global scale-ups staying in the continent, which the Commission is looking to address mainly through the startup and scale-up strategy.
Citing Nobel prize winner, Demis Hassabis, who said that we should make sure that we do not follow with AI the toxic playbook of social media, he noted that Cyprus will be joining the initiative announced by the President of the European Commission last week on the protection of minors online.
Moving on to the situation in Cyprus, Damianou said that the technology sector is growing in double digits and with a lot growing activity in AI.
He added that the Cypriot research and innovation ecosystem was ranked two places higher this year on the Global Innovation Index, taking 25th place globally, having currently six times more startups than 2020, with approximately 100 new startups every year.
‘We want to build on that momentum, on the strength of the economy and on our elevated geopolitical role, and solidify Cyprus as a hub, not just for technology, but also for innovation, for skills and for knowledge’, he stressed in that regard.
On government digitisation in the context of what is happening with AI in particular, the Deputy Minister mentioned as the first priority fixing legacy infrastructure and changing how computing is done in the government, moving towards cloud computing capabilities. He added a tender has been issued for a hybrid government cloud, which will implement the government’s public cloud-first policy.
The second thing we need to fix is our data across the government systems, continued Damianou, adding that the government is now running a significant portfolio of projects and expects significant progress in the next 12 months across the digital landscape, which will enable better technical capabilities, but also better interoperability.
He included among key highlights the new school management system which is starting to roll out this month, the new post office counter automation system to be launched in November, a unified system to replace all those fragmented tax systems by next year, the new integrated social insurance system starting to launch from this year, the new integrated register of company system, and the new road transport system, the deadline for which is September next year. He also said that the electronic justice system is back on track and its main phase is expected to be delivered by mid next year.
He also referred to the redesigned main websites for the ministries, the first fully public cloud service, the Digital Citizen app, which now has 120,000 registered users, and the first gen AI tool in the public sector, the Digital AI assistant, which, as he said, has answered or nearly 200,000 questions about more than 110 topics, as well as the national eID signature, a tool for signing legally binding documents.
He added that new services are coming for social insurance, social welfare, town planning and building management, new online services for the Citizen Service Centre and a call centre to support citizens.
As regards embedding AI in government, the Deputy Minister said that at the top level there is the AI strategy, which is going to be delivered by the National AI Task Force by year end.
‘It is going to touch on how we leverage AI to accelerate both the public sector and the private sector and also build efficiency. We are joining forces with the Greek government through the AI factory, Pharos, and that is a partnership, actually, to build a common Greek language AI space’, he further explained.
He added that at investments to build HPC infrastructure and chip design capacity for the research and innovation ecosystem in areas that are of strategic importance for the government are also being explored
‘If we zoom out from what is happening in the core government, the real benefit for the citizens will be when we manage to integrate all that with the rest of the ecosystem, with the industry. The tools that we are finally being able to deliver, the eID, the eSignature, the eInvoicing, these are all tools that the industry can use to build products and services for their customers, but also integrate with the government. The most important, though, is to make government a single source of truth for citizen data and for company data’, he stressed.
He also said that, the Smart Citizen Act for interacting with the local authorities and the community will be launched this year. ‘This is coming from a project we call Smart Cycles. It was launched end of July this year and essentially it is an AI-enabled platform, a single platform for the whole country to build that innovation on its own, to build any smart solution in collaboration with the local authorities’.
In closing, Damianou noted the Cyprus, as one of the leaders in terms of connectivity in Europe, was awarded first prize by the EU Commission at the European Digital Connectivity Awards of 2025 for the nationwide project of rolling out gigabit connectivity in non-urban areas, covering 100% of the population with high-speed gigabit Internet.