The Thalia 2021–2027 Cohesion Policy Programme is currently Cyprus’ most ambitious effort to support small and medium-sized enterprises (SMEs), with a total budget of €1.8 billion, including €969 million from the European Union and €842 million from the national government.
So far, calls worth €330 million have been launched under the programme, offering grants to strengthen SME competitiveness, support start-ups, promote research and innovation, and incentivise the recruitment of unemployed people from vulnerable groups.
Of this, €11.5 million has been earmarked for research and innovation projects, while €8 million will fund incentives for businesses to employ people from disadvantaged backgrounds.
Further calls are expected later this year, including schemes to support subsidised employment for individuals over the age of 50 and measures encouraging inactive women to return to the workforce.
By 2029, the Thalia programme is projected to increase Cyprus’ GDP by 6 per cent and create 8,500 new jobs.
Roughly 2,000 businesses are expected to benefit directly from its grant schemes, and 900 new research posts will support innovation and stronger collaboration between businesses and academic institutions.
Small and medium-sized enterprises already form the backbone of Cyprus’ economy, accounting for 99 per cent of all businesses and employing nearly three-quarters of the workforce.
Very small firms, defined as those with up to nine employees, make up 95 per cent of all businesses in the country.
Cyprus’ dependence on these businesses was highlighted on June 27, the International Day of SMEs, which celebrates the role of small firms in economic growth and social cohesion worldwide.
Since joining the EU in 2004, Cyprus has used Cohesion Policy Programmes to channel European funds toward SME support, helping firms innovate, digitise, and enhance their competitiveness.
During the 2014–2020 funding period, support reached 1,500 SMEs, protecting jobs and creating 2,700 new positions.
This included €15.4 million for manufacturing businesses, €15.3 million for youth and women’s entrepreneurship, and €13.2 million to drive innovation and digital transformation.
Many businesses also received subsidies to improve energy efficiency and reduce their carbon footprint, while others were supported to hire unemployed people and integrate them into the workforce.
