Cyprus: The IT Mecca of the Mediterranean (Not Really)

I decided to write about Cyprus and IT. Perhaps this post will upset some people, but I’m sharing my perspective as I see it.

I’ve been meaning to write about IT on our island for a while, but recently I found an additional reason to do so. Over the past few months, I’ve noticed an odd wave of posts in various communities, like: “Looking for a job in Cyprus, currently living in Sunny Podunkville, open to opportunities,” or “Vacationing in Cyprus, skilled and talented—if anyone has work to offer, let me know.”

Alright, I’m exaggerating a little, but overall, there has indeed been a noticeable increase in queries from people who don’t live in Cyprus but have clearly read or heard somewhere that Cyprus is now a fantastic place for the IT industry. I want to explain what it’s actually like, what the advantages are, and what the downsides are.

Let’s start with the fact that IT as an industry has never really existed on the island. I moved here in 2014, and back then, the IT sector was quite uniform. Thanks to offshore regulations and British law, many Forex companies had established a strong presence here, along with a few others connected to the financial sector.

I moved to the headquarters of Wargaming, and at that time, the company became known across almost the entire island. It was truly large, with a global reputation, and quite wealthy by local market standards. However, seven years later, Cyprus began to see significant growth in IT companies, many of which were game development (GameDev) companies. A substantial portion of these companies have roots in Russian-speaking communities. I cannot know for certain why this is the case, but I suspect that for European companies, it’s easier to operate within their own jurisdictions, while businesses from the former USSR have sought to move operations to a more transparent jurisdiction with British law and the added benefit of being in the EU.

As a result, there is now a sizable Russian-speaking community on the island, which even has an official group called CypRus_IT, created by Oleg Reshetnikov. There are also smaller communities, most of which are Russian-speaking, while the other ones I’m aware of are barely hanging on.

Companies in the financial sector (like Exness, MetaQuotes, and others) remain strong here. However, over the past seven years, the number of companies in the creative sector—particularly in Russian GameDev—has grown disproportionately. It’s no longer just Wargaming that stands out. Today, the island hosts major companies like Nexters, EasyBrain, Vizor, Playkot, Playgendary, Game Insight, Nekki, Nival, Pixonic, Awem, and many others.

For those interested, Cyprus is also home to the main office of MindGeek—if you know what I mean. And if you don’t, perhaps the names PornHub and Nutaku will ring a bell. 😉

Since a huge portion of these companies originate from Russian-speaking communities, the perception has emerged within these circles that Cyprus is becoming a sort of IT Mecca in the Mediterranean. This might explain the recent surge of interest from candidates. However, I’ll express what may be an unpopular opinion—no, Cyprus is far from being an IT Mecca at this point. Here’s why.

As I mentioned, ten years ago, nobody on Cyprus really cared about IT. Yes, there were companies operating in the sector, but they typically maintained only their legal offices here, with most development happening off-island. These companies also weren’t working for the local market. Thus, the main interest of the Cypriot authorities lay in collecting stable and decent taxes. For instance, when I moved to the island, Wargaming had about 20–40 employees here, which was already considered a lot. Most of them were part of the leadership team.

To understand the specifics, one must also consider the island itself. Cyprus is very small—the entire population (including territories occupied by Turkey) is about 1.3 million people. That’s the whole island! My hometown of Minsk has a larger population than the entirety of Cyprus.

Only two-thirds of the island officially belong to the EU as the Republic of Cyprus. The remaining third calls itself the Turkish Republic of Northern Cyprus (TRNC), which is officially recognized by only one (!!!) country in the world—Turkey—with all the implications that follow.

In the Republic of Cyprus, there are only a few major cities. The capital, Nicosia (recently more often referred to as Lefkosia, in the Greek manner), is located in the center of the island and is divided in half by the border between the Republic of Cyprus and the TRNC. Its population is approximately 280,000 residents. A city of similar size is Limassol (Lemesos). Next are Larnaca (85,000) and Paphos (66,000). The other towns are smaller and generally more resort-oriented. For example, Ayia Napa, the island’s largest tourist resort, almost entirely “shut down” for the winter seven years ago when the flow of tourists dried up. All cities, except for the capital Nicosia, are located on the coast.

Now, returning to the IT community, the lion’s share of it is concentrated in Limassol. The city is often called a “Russian city” here. Indeed, when you visit, you’ll hear Russian spoken almost everywhere, and the streets are lined with signs in Russian. The Russian-speaking population has truly favored this city more than any other. It’s the largest coastal city, the sea is almost “within walking distance,” and with sufficient funds, it can literally be that close. Limassol also most closely resembles an actual city. Sometimes, its infrastructure is even better than the capital’s. As for the other cities, they lose out in nearly every aspect except for the cost of living. Since Limassol has been favored by “wealthy IT companies,” the locals couldn’t help but take advantage. As a result, it is now the most expensive city on the island. Even the capital is cheaper on average.

However, contrary to the common perception of it being a “Russian city,” the actual Russian-speaking population of Limassol is not that large. Even the most optimistic estimates I’ve seen suggest it doesn’t exceed 10%. That’s a significant number, of course, but it doesn’t make the city Russian.

As I mentioned, most IT companies are based here. Some are building their own office spaces, while others are renting offices in the growing number of modern business centers that have been constructed to meet this demand. However, I’ve heard that after the closure of the Golden Passport program, the construction industry hasn’t been doing as well as before.

The main Wargaming building in Nicosia was for a long time one of the city’s main architectural highlights, although now taller buildings have been constructed.

It seems like an ideal setup—great community, good offices, the sea, the sun… It’s clear why so many see it as a Mecca and strive to get to the island by any means. However, there is a flip side.

As I’ve mentioned, 7–10 years ago, nobody really cared about IT here. This means the industry wasn’t represented on the island (except for a few companies working externally) and wasn’t supported in any way. In other words, there was no local talent market, and local universities and colleges never actively trained specialists in this field. This is very evident when you look at the state of digitalization across various sectors. The coronavirus pandemic significantly improved the situation, but before that, Cypriots, in my impression, treated the internet as something just for looking at photos on Instagram. The internet banking systems of local banks were tear-inducing, most companies didn’t know how to operate online (at best, they had a phone number listed on a page), and Cypriots gave directions instead of Google Maps links in a loud and animated manner like this: “You’ll pass the Coca-Cola billboard, then there’s Uncle Petros’ shop (you know Uncle Petros, of course?), take a left behind it, and then after the kiosk, you’ll find it in the courtyards.” And I’m not joking.

So if you’re planning to open an office on the island, you can almost forget about hiring local staff. It’s always a choice between bringing in employees from other countries (with all the “advantages” of relocation and work permits) or poaching talent from those who relocated them before you (with salary increases and still dealing with work permits). Moreover, there are restrictions on the number of non-locals you can hire, and often quotas require you to employ a certain number of Cypriots if you have a given number of non-Cypriots.

You should also keep in mind that the island is not cheap. The cost of living in Limassol is, on average, slightly lower than in Munich but higher than in Prague. It’s roughly one-third higher than in Moscow and double that of Minsk or Kyiv. It’s important to note that while this is an average figure from Numbeo, it doesn’t account for many factors that may not matter much to young couples but can significantly impact the budget of families:

• Local schools are free but operate exclusively in Greek, and the quality of education is very low (a well-known issue). If you want Russian education, it’s available in private schools, but they are paid. There are also private British schools and an American school, but their fees are even higher (although the education and approach are of good quality).
• Healthcare was previously entirely paid (state institutions were “almost free,” but not for newcomers). Since 2020, a new system called GESY has been introduced (I’ve written about it separately), which is supposedly “almost free,” but it hasn’t yet fully matured. Non-Cypriots sometimes face issues with it, and there are a number of restrictions that can lead to long waiting times or the need to pay out of pocket. Companies often provide private health insurance for employees (sometimes covering their entire families), but this also increases the “cost of an employee.”
• Housing rentals are more expensive than Russian speakers are typically used to. If you have a large family, the costs can become quite significant.
• Living without a car on the island is quite difficult (Cyprus is reportedly one of the top EU countries for cars per capita), although it’s occasionally possible. However, you’ll be very restricted. Taxis are not cheap either.

In addition, I’ve been surprised to discover that many people, after hearing about the “Russian Limassol,” believe it’s possible to live on the island without knowing any language other than Russian. Well, in Limassol, perhaps with the help of your company and friends, you might manage to get by. But I wouldn’t take that risk: the local population, for the most part, doesn’t understand Russian, which is logical. You can live perfectly well knowing only English, provided you don’t venture too often into remote mountain villages or visit government institutions. In the latter, English is also usable, but it becomes much harder—Greek is definitely preferred. Especially since, recognizing foreigners, Cypriots, following a well-established southern tradition, might easily overcharge you for certain services.

At the same time, there are no major incentives for the industry here, like the High-Tech Park in Belarus or tech hubs opening in Ukraine, Lithuania, and Poland. Tax burdens are high. Income tax isn’t the familiar flat 13% but a progressive rate of up to 35%.

All of this makes the cost of an employee for a company quite significant. However, I’m not saying no one is hiring—quite the opposite. Relocated companies are actively recruiting, but no business will overpay without good reason. You must be prepared that for 330 days of sunshine and proximity to the sea, something will have to be sacrificed. Many people gain in absolute numbers after moving, but in relative terms (or how much they can save for retirement), they often lose significantly. Growth can also be challenging because the IT sector is already considered wealthy by local standards compared to other industries.

Moreover, the lack of interest in IT as an industry has meant that infrastructure doesn’t always meet the sector’s needs. Mobile communication and internet are very expensive, even compared to many EU countries, let alone those in the former USSR. For example, €35 per month for a phone plan (with data limits), or €30–70 for internet that doesn’t offer very high speeds or great stability. The farther you are from a major city, the worse the stability (some friends in Larnaca struggled to make video calls from their apartments during the pandemic).

Of course, things are improving. Many Cypriots have already realized that IT is a great opportunity to move away from being purely a tourist-dependent country. Initiatives like the CypRus_IT community mentioned earlier and the so-called “Russian” political party I, the Citizen are actively contributing to this shift. However, the process is slow—the government is sluggish (after decades of things being “just fine,” why change?), and local talent cannot be developed quickly with mere desire.

So it’s important to understand that IT as an industry has its own peculiarities on the island. No one is waiting to welcome you with open arms just because you’ve decided to discuss it. Good specialists are always in demand, especially given the talent shortage, but a good employer will think twice about whether to relocate an employee to the island or work with them remotely (something the pandemic has taught many).

Candidates themselves shouldn’t have unrealistic expectations but should thoroughly research the issue and weigh the pros and cons. This is by no means Silicon Valley or San Francisco. But one can hope that someday, in terms of knowledge density and companies, it might get there.

As for me, I’ve grown very fond of Cyprus, and despite its shortcomings, I’ve learned to see its many advantages. While I don’t live by the sea but closer to the center of the island, that too has its benefits.

If you’d like to discuss this or just chat about the topic, I’m always open—my contact details are in the right column of the blog.

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P.S. Updates based on comments from friends and colleagues

It was rightly pointed out to me that the frequent use of the word “island” in the text might feel overwhelming. This is a very valid observation. Let’s not forget that Cyprus is an island—a small one at that. Over time, if you crave adventure, you’ll end up visiting almost all the attractions, including those in the occupied territories. And then, it might get a bit boring. I’m a homebody and a family man, so it’s easier for me, but not everyone feels the same way.

A significantly bigger issue about the island is accessibility: you can mostly get here by air. There is a ferry from Greece, but it’s not a very popular option. And flights are not the cheapest. Essentially, you can’t just hop in a car and drive from, say, Warsaw to party in Prague, Munich, Venice, and so on.

On the other hand, one advantage is the “tight-knit” nature of the community and the proximity of top managers from various companies since Cyprus is often where headquarters are based. In my opinion, the concentration of excellent specialists in Minsk or Kyiv is much higher than in Cyprus. However, in Cyprus, almost everyone knows each other since the population isn’t that large, and many people move between companies frequently.

Some newcomers don’t even consider Cyprus as a long-term place to live. Instead, they see it as a stepping stone on the way to mainland Europe, the UK, or North America, as it’s generally easier to move on from the EU than from outside it.

Another important point to mention is the status of spouses. If you move to the island with a job offer, you get a work visa, and your family can live with you. However, your spouse does not have the right to work on the island unless they receive a similar job offer from a company. By default, their visa does not allow employment. This often becomes a significant drawback since spouses are left idle, bored, and in many cases, lose their previous jobs due to the move, becoming financially dependent on their working partner.

Cyprus’s EU status brings many advantages, but not all of them apply to newcomers. A Cypriot work visa is not a Schengen visa (Cyprus is in the EU but not part of the Schengen Agreement). Therefore, you can’t just travel around Europe with this visa—you’ll still need to obtain a separate Schengen visa.