Cyprus’ economy is improving after years of financial recession. There has been emphasis on boosting the island’s research and entrepreneurial capacity, as evidenced by the appointment of the first Chief Scientist for Research and Innovation, the establishment of the Cyprus Research and Innovation Framework and other recent actions by Ministries.
The latest Cyprus National Team report provides an insightful overview of the changing dynamics of the country’s entrepreneurial ecosystem, identifies trends and highlights comparisons across Europe. Pantelitsa Eteokleous and Ariana Polyviou of the Cyprus National Team shared some thoughts about the key takeaways from the report in the following Q and A article.
What did you learn about how Cypriots view entrepreneurs?
The public in Cyprus increasingly perceives entrepreneurs positively. In 2018/2019, 67.6% had a high status association with entrepreneurs; the previous year it was 61.5%. Perceived media attention for entrepreneurship also increased this year (54.3% in 2018/2019; 50.5% in 2017/2018). However, the population’s confidence with respect to the capabilities to initiate entrepreneurial activity has gone down (52.4% in 2016/2017, 46.4% in 2017/2018, 45.9% in 2018/2019).
What did you learn from your research about the number of jobs created from entrepreneurs in Cyprus and the overall entrepreneurial ecosystem in the country?
There has been improvement. In previous years, a larger number of entrepreneurs in Cyprus foresaw one or more job positions arising from their entrepreneurial activity in the next three years (34% expect between one to five new job positions, 22.4% expect more than six job positions).
Do you think people in Cyprus are confident about starting a business?
Fear of failure remains remarkably high. Approximately one in two Cypriots fear failure in regard to their entrepreneurial initiatives. This has a direct impact on Cyprus’ Total Early-Stage Entrepreneurial Activity (TEA). The TEA index value recorded is the lowest across the last three years (12% in 2016/2017, 7.3% in 2017/2018, 3.9% in 2018/2019). Compared to the previous years, nascent entrepreneurial activity has reduced (7.6% in 2016/2017, 3.6% in 2017/2018, 1.2% in 2018/2019). Difficulties in accessing financial resources are one of the most important reasons for a business exit.
Can you tell us about the profile entrepreneurs in Cyprus?
The 45-54 year old demographic had the largest involvement in TEA this year, followed by the 35-44 year range. The ratio of females vs. males involved in TEA is 0.6. Most TEA entrepreneurs have a university education. Cyprus’ TEA is mainly opportunity-driven; 46.1% are active in the wholesale and retail sectors.
Tell us about Cyprus’ entrepreneurial ecosystem.
Cyprus’ entrepreneurial ecosystem is improving. The physical infrastructure and access to commercial and legal infrastructure are consistently considered as strengths. This year’s results also demonstrate a remarkable improvement in entrepreneurial education that is provided outside of traditional schooling. This improvement has been consistent over the last few years and reflects the government’s effort to improve Cyprus’ entrepreneurial landscape. However, GEM data also shows the need to improve entrepreneurial education at the school level. Doing this would help reduce fear of failure, minimize risk-averseness and cultivate an entrepreneurial culture from an early stage. There needs to be increased visibility of entrepreneurial programs for new businesses and the access to financial resources.
GEM 2018/2019 results also demonstrate the need to increase the number of transformational entrepreneurs who can be disruptive both at a local and global scale. Increasing access to financial resources, especially for early-stage and high-risk entrepreneurial endeavours, is necessary for improving the country’s potential to compete in the international entrepreneurial arena. Additionally, better coordination in promoting results to the outside of Cyprus and more synergies at a national level could also contribute to the further development of Cyprus’ entrepreneurial activity.
Access the National Team Report.