Cyprus National AI Strategy 2032 seen as framework for coordinated adoption

Nicosia, Cyprus. Dr Panayiotis C. Andreou and Dr Costas Tziouvas of the Cyprus University of Technology said the Cyprus National AI Strategy 2032 is an important step towards a coordinated approach to artificial intelligence.

Sector-focused approach

The academics said the strategy moves beyond individual AI applications towards a national framework for addressing a major technological transformation in a systematic and deliberate manner.

They said its architecture concentrates on sectors where Cyprus has economic weight, institutional capabilities or established strengths, including financial and professional services, shipping, tourism, healthcare, education and government.

Data, infrastructure, skills, research, governance and trusted AI are treated as shared enabling capabilities, they said.

The approach is consistent with strategies used by other small European economies, which emphasise coordinated adoption, shared infrastructure, human-capital development, public-sector transformation and trusted governance.

Partnerships and institutional capability

The academics said sovereign capability through partnerships is suited to a small economy. They said strategic autonomy does not require Cyprus to develop every AI model, semiconductor, cloud platform or technological capability domestically.

Instead, they said Cyprus should retain sufficient knowledge, control, resilience and freedom of action while using European and international partnerships to achieve scale.

They also identified data governance, interoperability, procurement capability, technological assurance, cybersecurity and regulatory certainty as elements of institutional capability. When designed effectively, these can form part of the infrastructure through which innovation spreads and scales, they said.

Evidence on productivity and growth

The academics said evidence at worker and firm level supporting AI strategies has strengthened. AI can increase productivity and support innovation among workers and firms and may eventually expand an economy’s productive capacity, they said.

However, they said the scale and timing of these effects at an aggregate economic level remain less certain.

They cited a 2025 study by Brynjolfsson, Li and Raymond, which found meaningful productivity gains following the introduction of generative AI in a workplace. They also cited a 2024 study by Babina, Fedyk, He and Hodson, which found that firms investing in AI recorded stronger sales, employment and market-value growth, with product innovation serving as an important channel.