“Statements and comments based on piecemeal and selective approaches for the sake of expediency do not contribute to correct information”
The Ministry of Finance issued an announcement responding to the criticisms it receives about the prospects of the Cypriot economy. As stated, “the Cypriot economy continues its upward trajectory, in accordance with the forecasts of the Ministry of Finance. Unlike other European countries which are entering recession, Cyprus during the 1st semester recorded the second highest GDP growth rate in the Eurozone, after Spain”. It is added that “the slowdown in the growth rate of the economy was predictable, which started from the 1st quarter of 2022. This is due to external factors such as the effects of continuous interest rate increases by the ECB, high prices in consumer goods and also due to of the impact on the service sector of the Cypriot economy from the implementation of sanctions against Russian entities”.
The entire announcement
Regarding publications that have seen the light of day and present a negative picture regarding the prospects of the Cypriot economy, the real picture is listed to restore the truth.
< p>The Cypriot economy continues its upward trajectory, according to the forecasts of the Ministry of Finance. Unlike other European countries that are entering recession, Cyprus during the 1st semester recorded the second highest GDP growth rate in the Eurozone, after Spain. In addition, Cyprus recorded a noticeable decrease in inflation in July to 2.4%, namely the fourth lowest inflation in the Eurozone and is one of the few countries that maintains a budget surplus. According to the Fiscal Council's Interim Report, “The Cypriot economy continues to record significant resilience despite ongoing uncertainty, with growth expected to remain close to 2.5%”.
The slowdown in the growth rate of the economy was predictable, which started from the 1st quarter of 2022. This is due to exogenous factors such as the impact of continuous interest rate hikes by the ECB, high prices in consumer goods and also due to the impact on service sector of the Cypriot economy from the implementation of sanctions against Russian entities. The slowdown in growth for 2023 has been predicted and is reflected in the forecasts of the Ministry of Finance, where it is estimated that the growth rate will be limited to a little below the predicted 2.8%.
In light of the above, the fiscal policy framework as drawn up and approved takes into account the developments in the Cypriot economy and in particular its predicted slowdown. And the results in public finances during the first half of 2023, despite the slowdown of the economy, compare favorably with the results of the corresponding period of 2022 since no deterioration of the state's fiscal position is observed. On the contrary, for all months without exception, the fiscal performance of 2023 is better than that of 2022.
The potential of the Cypriot economy, as presented above, and the healthy fiscal and financial framework, are solid foundations for the implementation of the economic governance program. The promotion of this program and its planned implementation will prove to be important elements for the success of governance.
The government is closely monitoring the developments in the Cypriot economy and is alert to deal with any negative developments that may arise. to arise that lead to a deviation from our predictions.
Statements and comments that are not accurate or that are based on fragmentary and selective approaches for the sake of expediency, do not in any way contribute to correct information.
