Finance Minister Makis Keravnos expressed satisfaction with the performance of the Cypriot economy in a statement to CNA, while assuring that the Ministry of Finance “will consistently continue the prudent and precautionary fiscal policy it is pursuing,” which “strengthens the economy’s credibility and resilience.”
When asked to comment on the data from the Statistical Service and Eurostat regarding the Cypriot economy for the first half of 2026, the Minister of Finance said that the data show that the Cypriot economy maintained a strong growth rate in a European and international environment that remains challenging. Real GDP grew by 3.3%, while corresponding growth in the eurozone was limited to 1%.
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“We are growing at a rate more than three times the European average, at a time when most European economies are struggling,” Mr. Keravnos emphasized.
The Minister of Finance placed particular emphasis on the composition of growth, citing data from the Statistical Service, according to which 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 spectrum of the economy and does not depend on a single sector, which makes it more sustainable.
Fiscal indicators, he added, are moving in the same direction, as the general government surplus for the period from January – July 2026 period amounted to €770.6 million, or 2.0% of GDP, an increase compared to the same 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 in the last decade.
Mr. Keravnos noted that this trend has also been confirmed by international credit rating agencies. In 2026, Standard & Poor’s in March and Fitch in May maintained the Republic of Cyprus’s investment-grade A- rating with a positive outlook, while Moody’s, in its periodic review in May, confirmed the A3 rating, anticipating continued budget surpluses and further debt reduction.
As noted, these are independent assessments based on fiscal discipline, public debt reduction, and the stability of the financial system.
Policies that distribute the benefits of growth to citizens
At the same time, in his statement to KYPE, the Minister referred to the pressures that households and businesses continue to face due to negative geopolitical developments, the ongoing conflicts in our wider region, and the global energy crisis, which have resulted in imported inflation—primarily driven by international energy prices—putting pressure on citizens’ incomes and businesses’ operating costs.
According to Mr. Keravnos, the government will continue to implement economic policies and reforms that channel the benefits of growth into the daily lives of households and businesses.
Source: CNA
