Research spending in Cyprus still low — business sector leads the way

Research spending in Cyprus as a percentage of domestic GDP remains low compared to the European average, despite an increase in absolute terms.

According to a report released on Wednesday by the Cyprus Statistical Service (Cystat), total research expenditure for 2022 was estimated to have reached €207 million, representing 0.75 per cent of GDP.

This represents a slight increase from the €199.5 million recorded the prior year, corresponding to 0.8 per cent of Cyprus’ GDP.

“Although there was a 3.8 per cent increase in research spending in 2022 compared to 2021, Cyprus’ share of GDP dedicated to research and development activities continues to remain at low levels compared to other countries,” the service said.

For context, the average percentage of GDP spent on research in European Union member states is 2.24 per cent, with ranges varying from 0.46 per cent in Romania, 0.69 per cent in Malta, and 0.74 per cent in Latvia, to 3.20 per cent in Austria, 3.40 per cent in Sweden, and 3.43 per cent in Belgium.

However, the statistical service pointed out that Cyprus has one of the highest average annual growth rates in research spending, standing at 10.3 per cent for the period 2000–2022, compared to 4.2 per cent for the EU over the same period.

Business sector leads in research spending

In terms of sectoral distribution, businesses accounted for €86.5 million, a share of 41.8 per cent, of total research expenditure in 2022.

The higher education sector followed with €77.5 million, a share of 37.4 per cent, private non-profit institutions contributed €31 million, a share of 15 per cent, while the public sector provided €12 million, a share of 5.8 per cent.

This compares to shares of 42.2 per cent, 38.4 per cent, 13.4 per cent, and 6 per cent respectively in 2021.

Within the business sector, information and communications technology emerged as the leading area of research activity with expenditures of €49.7 million.

The manufacturing industry also made significant contributions, particularly in the production of basic pharmaceutical products and preparations, and the manufacturing of computers, electronic and optical products, and electrical equipment, totalling €25.2 million.

Public resources funded 22.1 per cent of research activity in 2022, amounting to €45.8 million, compared to €46.4 million or 23.3 per cent in 2021.

Additionally, €27.2 million came from public university budgets, and €45.2 million was sourced from external funding, including EU grants.

Furthermore, private sector contributions totalled €88.8 million, a share of 42.9 per cent of the total, up from €81.9 million and a share of 41 per cent in 2021.

Increase in research employment

Meanwhile, the number of individuals employed in research activities in 2022 reached 4,241 people, compared to 4,209 in 2021.

In terms of full-time equivalent positions, this figure equates to 2,262 people, with 890, a share of 39.3 per cent being women.

Finally, the report noted that 33 per cent of the research workforce held a doctoral degree.