The Cyprus economy contracted for the third straight quarter in the first three months of the year, according to the flash estimate compiled by the Statistical Service on Tuesday.
Compared with the previous quarter, GDP declined on a seasonally adjusted basis by 0.3% in the first quarter of 2012, having dropped by 0.3% in the fourth quarter of 2011 and 0.8% in the third.
Economic activity in the third quarter was negatively affected by the armaments explosion in July that destroyed the main power station and led to four weeks of regular power cuts.
Growth also declined compared with the same period of 2011, by 1.5%, or by 1.4% on a seasonally adjusted basis.
In the fourth quarter of 2011, GDP declined over the year earlier by a seasonally adjusted 0.9%.
The Statistical Service said that negative growth rates were recorded in construction, manufacturing and electricity, retail and wholesale trade and transport.
Despite the difficulties facing local banks’ exposure to Greece, Cystat reported positive growth for banking, as well as other services (public administration, education, health and other services.
Cyprus has only had two recessions since independence in 1960: right after the 1974 Turkish invasion when GDP declined by 16.9% in 1975 and 19.0% in 1976, and in 2009, when GDP dropped by 1.9%.
Last week the European Commission said in its spring forecast that it expected the Cyprus economy to contract by 0.8% in 2012, while the government is expecting a decline of 0.5%.
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