Insider Economy Clouds gathering over Cyprus’ economy

Clouds gathering over Cyprus’ economy

Clouds are gathering over Cyprus’ economy as sectors such as tourism, consumption and services have started to shrink.

Official forecasts refer to an economic slowdown in the coming years, with the upcoming stricter regulation on shell companies leading to additional concern. Because this will significantly reduce the influx of new business in the services sector.

At the same time, tourism is suffering a blow from prevailing reduced arrivals from the United Kingdom due to uncertainly over Brexit.

The Stability Program 2019-2022 provides for a primary surplus of 5.3%, and government debt to be reduced at 95.8% from 102.5% in 2018. The growth rate is estimated at 3.6%, slightly lower compared to 2018 (3.9%), with unemployment falling to 7% (from 8.4% in 2018).

The Ministry of Finance predicts a slowdown in growth to 3% by 2022 (3.2% in 2020, 3% in 2021). Unemployment is projected to fall at 6% in 2020, 5.5% in 2021 and 5% in 2022.

The budget balance remains positive at +2.6% in 2020, +2.4% in 2021 and +2.2% in 2022, with primary surpluses steady above 4%: 4.6% in 2020, 4.4% in 2021 and 4.1% in 2022. Government debt is set to fall to 95.8% in 2019, 89.1% in 2020, 83% in 2021, and 77.6% in 2022.

However, the latest Economic Outlook of the University of Cyprus Economics Research Centre shows the negative signals accumulating around the island’s economy.

With the exception of the manufacturing and construction sectors, indicators are close to that of last semester which was low. The state of play is particularly negative in consumption, both among consumers and retail trade businesses.

At the same time, the International Monetary Fund has revised downward its forecast for economic growth. It says growth in 2019 will be at 3.5% from 4.2% expected in October and 3.3% in 2020.

The European Commission also forecasts a slowdown. GDP growth, it noted, is expected to reach 3.3% in 2019 and 2.7% in 2020.

 

Read more:

https://in-cyprus.com/president-reiterates-commitment-to-maintaining-conditions-for-high-economic-growth/

 

 

Top Stories

Cyprus’ revised 2021 budget approved by marginal majority

Cyprus’ revised 2021 budget was approved by marginal majority on Thursday evening allowing the government to deal with the crucial economic fallout from the...

Mainly fine on Friday with high cloud in the afternoon

Mainly fine on Friday with high cloud developing in the afternoon and light snow falling on  Troodos mountain. Winds will be north-westerly to north-easterly, initially...

164 new cases, one death announced on Thursday

The Health Ministry announced the death of one person due to COVID-19. This raises the death toll from the virus in Cyprus to 178,...

Where to get antigen rapid tests on Friday

The Health Ministry announced the following antigen rapid test sites for Friday, 22 January 2021: LIMASSOL Parking place Sklavenitis supermarket, Germasogia 08:30-16:30 Parking place Lidl supermarket, Limassol...

Alcohol consumption among Cypriot students high

Alcohol consumption among students has been reduced, the Cyprus National Addictions Authority ascertained on the basis of a European research, conducted every four years....

Taste

Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...

Mezedes

No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...