The budget of the deputy ministry of research for 2026 will rise by €5.4 million to a total of €172,864,636, Deputy Minister Nicodemos Damianou told the House finance committee on Friday.

The increase represents a 3.2 per cent overall rise compared to 2025, with a notable 13.8 per cent boost in development spending. The 2026 budget includes €70,062,349 in regular expenses and €102,802,287 in development spending. Damianou said the additional funds will support the government’s drive toward full digital transformation, innovation, and the creation of modern digital services for citizens.

He described the increase as an investment in people, innovation, and technology, rather than a simple financial expansion. The ministry’s goal, he added, is to build a fully digital public administration, strengthen advanced research, and promote strategic investments that will support Cyprus’s long-term economic growth.

Damianou said the ministry’s work focuses on three interconnected priorities: digital transformation, a sustainable innovation-driven economy, and cyber security. The first aims to align Cyprus with the EU’s digital decade 2030 targets by expanding digital infrastructure and skills. The second involves connecting research with industry, while the third focuses on protecting the country’s critical digital infrastructure and strengthening cyber resilience.

He explained that these objectives are reflected in the ministry’s 2024-2026 strategic plan and in its 2026 development budget. The initiatives, he said, are designed to create tangible economic and social benefits, keeping the Cypriot citizen at the centre of policy planning.

Reviewing progress for 2025, Damianou said 36 digital transformation actions were implemented under the national recovery and resilience plan, covering e-governance, broadband infrastructure, digital skills, and support for small and medium-sized enterprises.

More than 70 new e-government services are expected to be completed by the end of 2025 through the ministry’s digital services factory, including systems for social insurance applications and online appointments at citizen service Centres. All services are now accessible through the upgraded gov.cy portal, which records over 500,000 monthly visits, rising to more than one million when linked government sites are included.

The portal was enhanced in December 2024 with an AI-powered “digital assistant,” which has answered over 190,000 citizen queries on more than 120 topics, ranging from taxation to transport and consular matters. Damianou said the tool continues to expand and simplify public access to information.

The “digital citizen” app, which allows users to store official documents electronically, now has over 120,000 registered users. The app’s interoperability with Greece’s “gov.gr wallet” means Cypriot and Greek digital ID and driving licences are recognised in both countries.

In 2025, the ministry also launched a grant scheme for 100,000 electronic IDs, including 30,000 free of charge. The CYlogin authentication system now counts 570,000 verified profiles, including 409,000 individuals and 156,000 legal entities.

A new call centre will operate by the end of 2025 to guide citizens in using the ministry’s digital services and refer complex queries to relevant departments.

In research and innovation, the ministry allocated €27 million in institutional funding to research bodies and €21 million through the research and innovation foundation for competitive programmes, including “STEP – Production Lines” and “AI in Government.”

Preparations are under way for the 2026 launch of the national artificial intelligence strategy and action plan. Damianou said the plan will coordinate AI initiatives across ministries and integrate AI tools into key public systems such as “Ippodamos” and “iJustice,” the latter designed to support legislative work and judicial case management.

Cyprus also joined the European “AI Factories” network through the “Pharos-CY” initiative, securing €3 million in co-funding over three years. An AI expert committee has been established, and the public sector’s first generative AI tool, the “digital assistant”, has already been deployed.

Damianou said these actions will accelerate Cyprus’ digital transition, enhance productivity, and create new opportunities for growth and employment, strengthening the island’s role as a regional hub for innovation, technology, and entrepreneurship ahead of its EU Council Presidency in 2026.