EIF IN
CYPRUS
Investing in the future of Cypriot SMEs
Small and medium-size enterprises are the heart of the Cypriot economy.
Representing 99% of all businesses and more than two thirds of the workforce, Cyprus' 58,500 SMEs are responsible for driving innovation as well as spurring on growth, and their daily routine is what ensures the competitiveness of the Cypriot economy. But to do that, they often need finance.
At the same time, as the smallest actors in the economy, they are often the hardest hit when the economy encounters turbulence, which is why it is so crucial for them to have financial options in order to maintain and eventually grow their businesses.
At the EIF, our mission is to improve access to finance for small businesses across the EU. In Cyprus, we have been supporting SMEs using a broad range of instruments, including many tailored to the needs of the Cypriot market and designed with the Cypriot government and local authorities.
As a result, we've been able to support more than 1,130 Cypriot businesses, ranging from companies specialising in the pastry industry, medical imaging and interventional radiology, and educational toy systems, making sure they have the financial fuel they need to pursue their ambitions.
Our intention is to continue to extend this type of support to the Cypriot market, making access to finance easier as we collectively move towards a greener, digital and more inclusive Europe.
Success stories
Nextil
Success stories
New York Sweets
For almost three decades now, New York Sweets has been a pioneer in the pastry industry in Cyprus, specialising in the art of creating sweets with exceptional quality and design for a quick sugar-boost or a special occasion. From its origins in 1986 as a small “laboratory” and store, New York Sweets has grown into a staple of the high street with a network of stores across the island. From homemade cookies to brownies, cheesecakes to fruit cakes, fruit and walnut tarts to ice cream, New York Sweets is the reference.
Despite being so well-established, when the economy of Cyprus was hit hard by the 2011 explosion at Mari power station and then the financial crisis in 2013 “no business was untouched” explains Mr. Antonis Christofi, manager at New York Sweets. “More than anything, it was the psychological factor. In the short-term we were greatly affected. We went through difficult times, but we have rebounded, and things are looking up again.” With store renovations and new product and services offerings, Antonis and his dedicated team continue to give an old establishment a fresh new face.
Kotziamanis Diagnostics
“When you’re dealing with people’s lives, you want to be able to offer the best services possible” says Dr. Andreas Kotziamanis, who runs Kotziamanis Diagnostics in Limassol, Cyprus, alongside his daughter Natasa. The business specialises in medical imaging and interventional radiology. “We recently replaced all analogue equipment with new digital equipment, providing higher image quality with the lowest possible radiation dose to the patient.” explains Dr. Kotziamanis, “We are constantly upgrading our medical imaging devices, improving our information systems, our software and investing in cybersecurity. After all, this is sensitive personal data.”
A recent upgrade to the centre has been the addition of an MRI scanner to help with breast cancer diagnosis and treatment. “This new machinery will improve diagnostic accuracy. It will give us a more complete picture and allow us to detect tiny tumours much earlier” explains Dr. Kotziamanis. “At the end of the day, the better the system works, the stronger our position when we try to save lives” concludes Dr. Kotziamanis.
Sir Paul Hotel
“It was a beautiful old mansion right in the middle of the old town of Limassol, and it had actually been abandoned and empty for around 30 years,” explains Natali Martini, Director of LMNP City Hotels. “It has a lot of sentimental value for us, as it’s been in the family since the 1800s and was also used as the Town Hall at some point, so we didn’t want to just rent it out.”
What to do with decaying old buildings is a common concern in Cyprus. But Natali, herself a graduate in hotel management studies, was set on turning it around and setting up a boutique hotel right in the middle of the old town. With financing secured, Natali proceeded with much-needed adaptations, which turned the building into a 22-room boutique hotel, maintaining all of the building’s features and charm.
And the Sir Paul name? “It’s named after my great grandfather, Pavlos Pavlides, who was knighted back when Cyprus was still a British colony. We wanted to keep the connection to the family.” Natali adds.
Engino
“We want to get kids thinking creatively from an early age–as young as two. These are the innovators and engineers of tomorrow” reflects Costas Sisamos, whose Limassol-based company Engino provides products that strive to develop and promote creative thinking in the next generation. Having taught design & technology in primary schools, Costas wanted to inspire his students to become better problem solvers, which led to his founding Engino in 2004. Today the company designs, produces, and exports the Engino toy system to more than 50 countries across 4 continents.
With a strong focus on R&D, the patented ability of the system to snap fit on multiple locations is a defining feature, with the company already receiving several local and international awards. With a product range of more than 50 different sets, ranging from simple structures and mechanisms to solar energy sets and wireless robotics, Engino enables children to build fast and easy, simple, or complex models. Moreover, all products are environmentally friendly, using recyclable plastic, sustainable beech wood and motors powered by solar panels instead of batteries.
Key figures
Over
of EIF financing
Transactions with financial intermediaries
Equity investments since inception
Guarantees support since inception
made available for
Cypriot businesses
Mandates in focus
The EIF continues to deploy capital in Cyprus under a wide range of strategic programmes and mandates. Below are brief summaries of our main initiatives in Cyprus.
InvestEU
The InvestEU programme provides the EU with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It is helping to mobilise private investments for the EU’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU Programme brings together under one roof the multitude of EU financial instruments previously available to support investment in the EU, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.
RCR
The EIB’s Risk Capital Resources (RCR) is the core pillar of the EIF’s equity activity. It has enabled us to pursue our equity strategy in the venture capital and growth segments for more than 25 years. In 2023, RCR accounted for 25% of our equity activity, committing €1.4bn to financial intermediaries.
EFSI
The European Fund for Strategic Investments formed part of the EU's Investment Plan for Europe, launched by the European Commission in 2015. EFSI addressed market gaps in financing - whether in infrastructure, research, energy efficiency or risk finance for SMEs – and mobilised private investment into these areas. Through EFSI the EIF deployed €10.5bn in resources of the European Commission, the EIB and the EIF to improve access to finance for SMEs and small midcaps.
REPowerEU
The EU launched REPowerEU in 2022 to reduce dependence on fossil-fuel imports and accelerate the green transition. To support the plan, in October 2022, the EIB Group developed a package of measures focussing on renewable energy, energy efficiency, electricity networks and on deepening its engagement in green innovation and breakthrough technologies. Under REPowerEU, the EIF will invest €4.5bn by 2027 through EIF equity products.
EGF
The European Guarantee Fund was created by the EIB Group with contributions from Cyprus and other Member States to protect companies struggling in the crisis caused by COVID-19. With almost €25bn in guarantees, the EGF allowed the EIB and EIF to swiftly offer companies, mostly SMEs and mid-caps, access to loans, guarantees, asset-backed securities, capital and other financial instruments. The EGF forms part of the package of recovery measures put in place by the EU, with the objective of providing a total of €540bn to support the hardest hit sectors of the European economy.
CYPEF
The Cyprus Entrepreneurship Fund (CYPEF) is a fund established by the Republic of Cyprus to support and strengthen entrepreneurship in the country by enhancing access to finance to SMEs. The initiative is managed by the EIF. The initial €70m of capital provided by the Cypriot Government for phase 1 of the CYPEF initiative has been matched through equal contributions from the EIF and its selected financial intermediaries, translating into about €140m of financing to the benefit of Cypriot SMEs. In 2021, the Republic of Cyprus and the EIF signed the continuation of the CYPEF initiative, under a new phase. An additional contribution of €200m, funded by the government, will provide the necessary funding for financing new investment needs of SMEs and midcaps, while meeting the financial challenges caused by the COVID-19 crisis. The two phases together are expected to create a substantial portfolio of around €540m.
RRF – Cyprus Equity Fund
The Cyprus Equity Fund is the first equity mandate signed between the EIF and the Republic of Cyprus. The mandate is structured as a direct award of €30m to the EIF, financed predominantly by the national Recovery and Resilience Plan (RRF) of Cyprus and reflows from the JEREMIE programme of the 2007-2013 programming period. These resources have been invested into a generalist VC fund targeting innovative enterprises and start-ups in their (pre-) seed and early stages of development. This will be the first VC fund deployed in the country with the support of public resources.