IMF anticipates Cyprus economic activity growth in 2024

13:31 - 31 March 2023

Economy Reporter

An International Monetary Fund (IMF) mission has found that economic activity in Cyprus held up better than expected in 2022 but is anticipated to decelerate this year, before growing again in 2024.

The mission met with the Cypriot authorities from 16–28 March to discuss recent economic developments and policy priorities.

At the conclusion of the visit, Wojciech Maliszewski, IMF mission chief for Cyprus, made the following statement: “Activity held up better than expected in 2022, but is projected to decelerate this year, before picking up again in 2024.”

Maliszewski went on to say that growth in 2023 had been supported by pent-up domestic demand, strong tourism revenues despite a significant drop in arrivals from Russia and Ukraine, and an expanding Information and Communication Technology (ICT) sector.

“High energy prices contributed to inflation, transmitting to core prices amid a tight labor market. Lower disposable income and tighter financial conditions are expected to slow growth this year. Policies should focus on locking-in the gains achieved over the last decade—including by continuing prudent fiscal policies and safeguarding financial stability—while resolving remaining legacy issues, especially high non-performing loans (NPLs) through effective implementation of the foreclosure framework,” Maliszewski added.

The reforms embedded in the Recovery and Resilience Plan (RRP) continue to provide an anchor to progress further on strengthening governance, addressing skill mismatches, closing the digital divide, and greening the economy, he concluded.

(Source: IMF)

IMF anticipates Cyprus economic activity growth in 2024

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