Eurobank emphasizes the importance of strengthening and diversifying Cyprus’s sources of foreign revenue, noting that Cyprus’s current account deficit is widening, even as economic growth continues.
Specifically, it is noted that the current account deficit widened further in 2025, while data for the first half of 2026 also indicate a further deterioration. As stated in a Group press release, the current account deficit for 2025 increased by €870 million, to €3.21 billion.
ΣΧΕΤΙΚΑ ΑΡΘΡΑ
The largest adjustment related to a €1.42 billion increase in the estimated primary income deficit, primarily regarding net investment income. The goods account deficit was also revised upward by €201 million, while net current transfers abroad were €108 million higher than the previous estimate. These changes were partially offset by an upward revision of the services surplus by €855 million, mainly due to higher estimated net receipts from telecommunications, IT, and information services.
In the first half of 2026, the deficit reached €2.42 billion, an amount corresponding to 12.8% of GDP for the same period, compared with 10.1% a year earlier. The deficit widened by €635 million, with nearly the entire increase occurring in the second quarter. The goods deficit increased by €441 million, while the services surplus decreased by €432 million. Exports of services continued to rise, but payments for imported services grew faster. In telecommunications, IT, and information services, the surplus decreased by €212 million, despite an increase in export revenues. Smaller surpluses were also recorded in travel and financial services, by €183 million and €230 million, respectively.
Eurobank cites the October 2026 edition of the World Economic Outlook, in which the IMF projected a current account deficit of 7.7% of GDP for 2026. The Group further estimates that, based on the latest data, “there is a significant risk that the deficit will reach levels higher than this forecast.”
“These developments highlight the importance of strengthening and diversifying Cyprus’s sources of foreign revenue as the economy grows,” it states, with the Group proposing to leverage the services sector to boost export revenues by supporting businesses in developing their skills, introducing new products and services, and reaching customers in new international markets.
It also recommends providing more opportunities for local businesses to supply goods and services to international companies operating in Cyprus. In this way, according to Eurobank, more businesses can benefit from growing sectors.
The Group also notes further, that reducing dependence on imported energy is essential and proposes supporting sustainable investments in renewable energy sources and more efficient energy use, in order to gradually reduce the need for imported fuels.
It also promotes savings and business investments, with Eurobank advocating for the enhancement of financial literacy and saving for the future, alongside financing that helps businesses invest and grow.
