Finance Minister Makis Keravnos has expressed satisfaction with the performance of the Cypriot economy, while assuring that the Ministry of Finance “will consistently continue the careful and prudent fiscal policy it has been pursuing”, which “strengthens the credibility and resilience of the economy.”
Asked to comment on data released by CySTAT and Eurostat on the Cypriot economy for the first half of 2026, the Finance Minister told the Cyprus News Agency (CNA) that the figures show that the Cypriot economy maintained a strong growth rate in a European and international environment that remains challenging. Real GDP increased by 3.3%, compared with growth of just 1% in the euro area.
“We are growing at more than three times the European average, at a time when most European economies are struggling to maintain momentum,” Keravnos stressed.
The Finance Minister placed particular emphasis on the composition of growth, citing Statistical Service data showing that the largest contributions came from wholesale and retail trade, the information and communications sector, financial and insurance activities, and construction.
As he pointed out, growth is spread across a broad range of the economy and does not depend on a single sector, which gives it greater sustainability.
Fiscal figures are moving in the same direction, he added, with the General Government surplus for the January-July 2026 period reaching €770.6 million, or 2.0% of GDP, up compared with the corresponding period last year.
He noted that public debt fell to 55.0% of GDP at the end of 2025, below the 60% threshold for the first time since 2009, as he said, and continues to decline, while unemployment remains at its lowest levels of the past decade.
Keravnos said this performance had also been confirmed by international rating agencies. During 2026, Standard & Poor's in March and Fitch in May maintained the Republic of Cyprus at investment grade A- with a positive outlook, while Moody's, in its periodic review in May, affirmed its A3 rating, expecting fiscal surpluses to continue and public debt to decline further.
These, he said, are independent assessments based on fiscal discipline, the reduction of public debt and the stability of the financial system.
Policies to spread the benefits of growth to citizens
At the same time, the Finance Minister referred in his statement to CNA to the pressures that households and businesses continue to face due to negative geopolitical developments, the continuation of conflicts in the wider region and the global energy crisis. These factors have resulted in imported inflation, mainly driven by international energy prices, putting pressure on citizens’ incomes and increasing operating costs for businesses.
According to Keravnos, the Government will continue to implement those economic policies and reforms that ensure the benefits of growth are felt in the everyday lives of households and businesses.
(Source: CNA)
