Nicosia:Cypriot companies rank last among European Union member states in implementing measures to reduce greenhouse gas emissions, as shown in the 2026 EIB Group Investment Survey. The survey highlights that European companies are maintaining steady investment and adapting to geopolitical and trade risks.

According to Cyprus News Agency, only 76% of firms in Cyprus have taken steps to cut emissions, compared to an EU average of 92%, marking the lowest percentage among the 27 EU member states. The survey indicates that the energy transition is progressing across the EU, with 53% of European firms now using renewable energy, an increase from previous years. Additionally, 67% of these firms have invested in energy efficiency, which is a 10 percentage point rise from 2022.

The survey, conducted through interviews with approximately 12,000 EU firms between April and July 2026, found that 85% of firms invested over the past year, consistent with previous years. Furthermore, a net 8% more firms anticipate an increase in investment rather than a decrease.

Economic security remains a significant concern, with 55% of European firms experiencing effects from trade restrictions and strategic dependencies. In response, 64% of these firms have taken action, primarily by altering technology choices or changing partners and suppliers. Cybersecurity is also a focus, as 82% of EU firms invest in protection measures, with 8% having faced a major incident. In Cyprus, the investment in protection measures is slightly higher at 85%.

European firms are reportedly handling trade tensions more effectively than their US counterparts. While 51% of EU firms express concerns over tariffs and customs changes, this figure is significantly higher at 81% in the US. Notably, European firms continue to diversify suppliers and remain active in international trade, unlike 33% of US importers who are reducing their import share.

The survey also sheds light on artificial intelligence usage, with 67% of European firms already employing AI, a statistic equal to that in the US. In Cyprus, 65% of firms use AI, with 14% planning adoption, while 15% have no plans to utilize AI. EU firms primarily use AI for internal processes, lagging behind US firms in marketing, sales, and product development applications.

The EIB identifies a gap in Europe regarding the diffusion rather than the creation of innovation, with only 20% of EU firms investing significantly in new-to-the-firm innovations, compared to 44% in the US. However, defence and security firms within the EU are expanding, with 78% maintaining or increasing investment and 19% introducing innovative products to market.

The survey notes challenges within the single market, with 65% of exporters facing varied product requirements or consumer protection rules across member states. This compliance burden is heavier on smaller firms, with 22% of SMEs dedicating over 10% of their staff to compliance, compared to just 4% of large companies. While access to finance has improved, uncertainty and skills shortages remain significant barriers to investment.