Cyprus industry shows impact of Mari explosion

A hit to an already declining sector

Figures for industrial production in Cyprus in July show the impact on the broad industrial sector of the explosion on July 11 that knocked out the country’s main power station at Vassiliko and led to four weeks of daily power cuts.
Output of electricity dropped by 15% compared with July 2010, production in the large manufacturing sector fell by 13.9% and output of mining and quarrying tumbled by 18.4%.
However, all of these sectors were already declining in June: electricity dropped 2.6% compared with June 2010, manufacturing fell 7.8% and mining and quarrying fell 5.7%.
Moreover, in 2010 manufacturing accounted for just 5.9% of GDP, and the broader industrial sector 8.3% of GDP. Therefore, the impact on this year’s real GDP growth rate might not be as huge as some are predicting.
The real GDP growth recorded 1.4% in the first half of the year.
Fiona Mullen
www.sapientaeconomics.com