Cyprus Manufacturing Sector Proves Resilient Amid Global Challenges, Says Oev

Despite ongoing structural hurdles, Cyprus’ manufacturing sector has once again shown its ability to weather international instability, according to the Employers and Industrialists Federation (Oev). In a statement ahead of its upcoming general assembly, the federation emphasized the importance of enhancing competitiveness by curbing input costs, calling this a critical factor for unlocking the sector’s full potential.

These matters are expected to take center stage at Oev’s annual general meeting, which is scheduled to take place on Wednesday, May 7, 2025, at the Hilton Nicosia. The event will be attended by President Nikos Christodoulides, who is also set to deliver an address, the federation confirmed.

According to Oev, the manufacturing industry in Cyprus recorded a growth rate of 2.8 percent in 2024, a slight dip from the 3.4 percent increase registered in 2023. The sector’s contribution to the national GDP remained notable at 6.5 percent.

Throughout 2024, Oev maintained a vigorous level of activity aimed at underscoring the industry’s importance to the Cypriot economy. One of its major initiatives was the development and presentation of a comprehensive proposal for a new Industrial Policy and Action Plan for the 2024–2029 period. This plan was formally submitted to the president and was formulated through consultations with professional bodies in the industrial sector, manufacturers based in government industrial zones, industrial area management committees, and large exporters.

The proposed strategy is organized around six core pillars and includes a total of 55 targeted actions over the next five years. Among its chief priorities is the reduction of energy costs, which Oev describes as “a critical factor in enhancing the sector’s competitiveness.”

The policy also outlines measures to support the employment of third-country nationals in technical roles and proposes specific incentives to drive export growth. Other key aspects include the improvement and efficient operation of industrial zones, and ensuring fair competition with products originating from the occupied territories, as stipulated by the Green Line Regulation.

Additionally, the federation has advocated for the establishment of a dedicated oversight authority—such as a deputy ministry or a general directorate of industry—that would be tasked with coordinating and supervising industrial development across the country.

Oev noted that its 2024 agenda was also packed with initiatives addressing various sector-specific issues. Among them were consultations with the competent ministry regarding a new grant scheme for large-scale industries, as well as the organization of information sessions about financial support schemes offered by relevant ministries.

The federation placed particular emphasis on promoting the Cypriot defence industry, fostering industrial participation in procurement programmes, and boosting academic collaboration to drive innovation.

It also hosted a meeting between export-oriented firms and the trade service of the Energy Ministry, and submitted recommendations aimed at extending and improving existing grant programmes. Oev further submitted a memorandum to the Ministry of Finance pushing for stronger industrial outreach and introduced tailored training initiatives to support the sector’s overall growth.

On the infrastructure front, the federation tabled proposals for improving facilities within industrial zones and contributed to both the creation and management of the Strovolos Industrial Zone’s oversight committee. It also welcomed new industrial associations from Ypsonas, Frenaros, and Deryneia into its network.

Fire safety issues in the Geri – Idalion Industrial Zone were another focal point, along with meetings and site visits with the Energy Ministry and the House committee on industry in various districts.

“The Cypriot manufacturing industry, despite the difficulties and structural problems, manages to survive because, as has been proven, it is particularly resilient to international disruptions,” Oev stated.

“What is needed is support for competitiveness through the containment of production factor costs in order to fully unleash its potential,” the federation added.

“All of the above issues will be central to discussions at the Oev’s annual general assembly, during which the president of the Republic will be in attendance and deliver a speech,” the announcement concluded.

By fLEXI tEAM