Nicosia, Cyprus. President Nikos Christodoulides said Cyprus could grow its domestic defence industry to a double-digit share of gross domestic product in the coming years as defence spending continues to rise.
President outlines growth target for defence sector
Speaking at the Presidential palace during a meeting with defence council members and Defence Minister Vasilis Palmas, Christodoulides said the government’s political will was clear and that the sector had the capacity to develop into a significant pillar of the economy alongside its strategic role in national security.
“I consider it entirely possible that the Cypriot defence industry in the coming years will reach a double-digit figure in terms of the country’s GDP,” he said.
“This is not an exaggeration. I know our capabilities very well. It is a very promising new sector of our economy, but also part of our clear will to strengthen the deterrent power of our country.”
Defence spending trends and budget outlook
Cyprus has increased defence outlays steadily in recent years, with annual military spending remaining above €170 million and budgeted allocations for armaments in 2026 approaching €180 million.
Defence expenditure currently stands at just under 2 per cent of GDP, in line with a wider policy of modernising the national guard and deepening cooperation with regional partners.
Defence council review and next steps
Christodoulides said the meeting was intended to take stock of progress since the council was institutionalised a year ago and to identify gaps in implementation.
He referred to goals set at the time, including the creation of a registry of Cypriot defence companies.
“Last year we took the decision to institutionalise the council, and I want to see what we have done in one year, and what we need to strengthen further.”
The president placed particular emphasis on the need to support Cypriot firms in accessing international markets and participating in European defence initiatives.
What do you think the expansion of the domestic defence industry could mean for Cyprus’s economy and security?
