Peace in Ukraine could see a quarter of the Ukrainians who have moved to Cyprus and their businesses return home, reports said on Sunday, underlining the potential impact on the island’s economy.

These are the conclusions of a Fiscal Council survey, which were published in Phileleftheros on Sunday.

Those who fled to the island after the Russian invasion of Ukraine have contributed in a professional capacity to the island’s economy, mainly in the field of information technology and technology.

It is estimated that about three quarters of the Ukrainians who currently live on the island came here after the Russian invasion and that about 80 per cent of them are also tax residents.

Last summer, the council expressed concerns about what would happen if these people left en masse, which coupled with a perceived lack of a government policy on how to protect these investments, led to the study.

It commissioned IMR/University of Nicosia to carry out the survey, which reportedly shows that the government has underestimated the contribution of Ukrainians to the economy.

It showed that 25 per cent of the Ukrainians asked said they would return home if the war came to an end, although it could end up higher.

Wealthy Ukrainians with incomes of more than €75,000 would be the first ones to leave, the Fiscal Council said. In a note forwarded to parliament, it said this “should be a cause for concern, since it would probably also affect the middle income strata through employment”.

In total, 44 per cent said they were ‘not likely’ they would stay.

At the same time, the Ukrainians who have expressed their intention to remain in Cyprus are mainly middle-income executives, with earnings of €35,000 to €75,000. Among these, 24 per cent said they would definitely stay in Cyprus while 66 per cent said they would ‘very likely’ stay.

According to the Fiscal Council, the Ukrainian community in Cyprus is economically active, with 35 per cent of individuals and 44 per cent of businesses operating in the technology sector, where Cypriot exports and value added increased sharply after 2022.

In terms of employment, 44 per cent of Ukrainians in Cyprus are full-time employees, while 12 per cent declare themselves self-employed and five per cent are an ‘investor or director’.

The Ukrainian community in Cyprus as a whole has higher incomes than the domestic average: almost one third (28 per cent) have incomes between €35,000 and €75,000, with an additional six per cent above €75,000.

The Council said there is satisfactory integration with the Cypriot economy, but with significant room for growth. Two thirds said they cooperate with Cypriot businesses, and the same percentage that their supply is located within Cyprus. Meanwhile, one third said they employ Cypriots.

In addition to the value their taxation provides the Cyprus economy, almost 80 per cent of Ukrainians questioned said they spend more than 50 per cent of their income in Cyprus, although the richest say they spend a smaller percentage here.

Meanwhile, 14 per cent of Ukrainians say they have invested in Cyprus, with 74 per cent investing in real estate, 11 per cent in IT, 14 per cent in both trade and financial services, and nine per cent in hospitality.

The Fiscal Council now plans to conduct a new survey with a larger sample and by using government data.

“A clearer picture will allow for the timely formulation of policies and incentives, with the main aim of encouraging Ukrainians in Cyprus, instead of relocating their businesses here back to Ukraine, to make foreign direct investment (FDI) from Cyprus to their country,” it said.

This, it said, could turn a potential risk for the economy into an opportunity.