Energy costs to put Limassol industries at risk

Soaring energy costs and suffocating bureaucracy are the biggest threats facing Limassol’s industries, Energy Minister George Papanastasiou has warned, pledging swift action to tackle the crisis.

Speaking after a series of factory visits on Monday, Papanastasiou said high electricity prices are crippling businesses, especially those whose competitiveness hinges on production costs.

“One of the most serious problems is the cost of energy,” he said at a meeting held at the Limassol chamber of commerce and industry (Evel).

“This issue comes up strongly from productive industries and energy-intensive sectors whose ability to compete depends heavily on the cost of the goods they produce.”

Solar power, he explained, can help reduce bills, but not enough to let Cypriot firms go toe-to-toe with rivals in countries where energy is far cheaper.

“Photovoltaic systems are indeed a solution that can offer cheap energy to keep these industries in production,” he said.

“But they do not produce enough power to allow our industries to compete when the competition comes from countries where energy costs are significantly lower.”

But it’s not just heavy industry feeling the strain. Papanastasiou said his tour also took him to high-tech businesses where he discovered cutting-edge know-how that many ordinary Cypriots might not even realise exists on the island.

“There’s technology out there in our industry that is unprecedented,” he said.

“We found a lot of talent, mainly Cypriots working in these industries, but we also met people ready to invest further in innovation and technology.”

Yet even the tech sector is burdened by bureaucratic hurdles, he noted, stressing the government must do more to ease the path for private enterprise.

“These industries face several issues, many of which are linked to bureaucratic procedures,” he said.

“We will focus on providing solutions for these businesses beyond just electricity.”

Papanastasiou admitted the private sector often moves faster than the public service, a gap he said must close if Cyprus’ industries are to thrive.

“The private sector moves at a faster pace than the public sector,” he said. “For results to be achieved, these two sectors must move at the same speed and in the same direction.”

His comments come as Cypriot businesses grapple not only with energy bills but also concerns over safety in industrial zones, the development of the technology park at Pentakomo, export growth, and how Cypriot products are viewed abroad.

Discussions at Evel also covered the role of natural gas, solar power and storage systems in cutting costs and ensuring a stable energy supply for local manufacturers. Papanastasiou insisted the government’s priority is to help industries overcome hurdles so that Cyprus’ private sector can develop at the pace it needs.

“That’s the goal of the ministry, to provide solutions for these industries so that we can see positive results,” he said.