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“Innovation and Start-ups drive a nation’s economy and are a key engine of economic growth “ – KPMG Startups

Every economy needs a culture of innovation led by entrepreneurship. This is especially so in an economy like Cyprus which was hit both by the global crisis of 2008 as well as by a local indigenous crisis in 2013 set off by the over-exposure of Cyprus banks to Greek bonds and their consequential need for recapitalization. The national economy’s consequent downgrading to junk by credit rating agencies resulted in its inability to secure loans from the international markets. The subsequent bail-out by the so-called Troika(EU/CEB/IMF) imposed on Cyprus a harsh programme of economic austerity which among other measures led to the resolution of Cyprus’s second biggest bank, Laiki Bank and a one-time bankdeposit levy on all uninsured deposits there, plus a further 48% levy on the uninsured deposits with the Bank of Cyprus, the island’s biggest bank. The crisis led the economy into a recession spiral which lasted until the back end of 2015 with unemployment rising to unprecedented levels for the country.

Strict adherence to the MoU signed with the Troika and the country’s determination to turn the crisis into a challenge for progress helped to bring about the long needed structural and fiscalreforms which soon yielded results that enabled the economy to move fromrecession to growth after 2-years of economic hardship. Cyprus managed torebuild its credibility and already has managed to secure loans frominternational markets. In March 2016, Cyprus will have successfully completedand exited the bail-out programme of the Troika.
Cyprus is emerging as a tech hub

The challenge now is to set the Cyprus economy on a sustainable course of development which will lead to growth and this is where start-ups will play an important role. It will not be an exaggeration to state that Innovation and startups can be the locomotive of Cyprus’ economy, thus becoming a key driver for economic growth. Acknowledging the important contribution of start-ups, both the Cyprus government using EU funds, as well as private and financial institutions, are setting the foundations for anew business environment conducive to innovation and to entrepreneurs transforming their start-ups into successful businesses.

The epitome of this new culture towards innovation and start ups is the fact that gradually there is a new class of young entrepreneurs emerging and their commitment is supported by an increasing number of startup awareness events, competitions and accelerators .

In fact Cyprus, and its capital Nicosia, seem to be becoming one of the 8 locations worldwide where technology’s influence is growing by the minute, according to author Lisa Roolant who has recently posted an article on the TransferWise Blog entitled “Why you should pay attention to these 8 emerging tech hubs”, and which “the world should start paying close attention to”.

The author refers to companies like NCR and TSYS that have chosen Nicosia for their regional headquarters.
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