Middle East Crisis Dampens Limassol Business Confidence Amid Rising Costs and Economic Uncertainty
The spring/summer 2026 Limassol Chamber Business Barometer reveals a sharp decline in business confidence due to the Middle East crisis, increased energy costs, weaker sales, and economic uncertainty. Nearly 45% of companies report significant pressure from energy issues, while concerns over high labour costs and weaker demand have also intensified. Despite these challenges, over half of the businesses still plan to invest in areas such as software, buildings, and energy-saving measures.
The survey highlights persistent longstanding problems including labour shortages, bureaucracy, and delays in justice. Cutting costs and reducing red tape are the top priorities for businesses seeking government support, with 25% of respondents identifying these as critical areas for improvement. Confidence in export markets has also declined, with over a third expressing reduced optimism.
Although economic worries have grown, recruitment efforts continue, with many firms looking to hire across a broad range of professions. The appetite for technology investment, especially in artificial intelligence and digital transformation, remains strong. However, overall confidence in the Cyprus economy has dropped considerably, reflecting geopolitical uncertainties and rising commodity prices.
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