Cyprus economy to grow by more than 5% this year

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Cyprus’ economy is expected to grow by more than 5% GDP in 2022; the Finance Ministry said preliminary estimates showed a 6.1% year-on-year growth in Q2 despite the fallout from the Ukraine war.

According to the preliminary estimates, the economy’s growth rate in Q2 2022 is estimated at 6.1% compared to the same quarter of 2021 and 0.6% compared to the previous quarter.

During the first quarter of 2022, GDP had increased by 1.3% compared to the last quarter of 2021.

The growth rate for Q1 was revised upwards by 0.4% to 6.0%. Therefore, for the six months of 2022, GDP growth is estimated at 6%.

“This rate is the highest among the Member States and higher by about 2 pp both from the average of the Eurozone and the EU, which is calculated at 3.9% and 4.0%, respectively”, said the Finance Ministry.

“Based on the available data, expectations are strengthened by the strong performance of the tourism sector, predicting the Cypriot economy in 2022 will accelerate with a growth rate of more than 5%,” it added.

“The continued prudent fiscal policy and economic management of the Government, along with the implementation of the National Recovery and Resilience Plan, are expected to contribute to develop further and strengthen the resilience of the Cypriot economy to face any challenges.”

However, the Ministry of Finance’s estimates is far more optimistic than the EU forecast.

The European Commission, in its Summer forecast, upgraded its 2022 estimate for the Cypriot economy to 3.2% from 2.3% in spring.