CYPRUS: 0% growth in 2015, says Fiscal Council

The Cyprus economy is expected to record a flat growth rate of 0% next year, according to the Fiscal Council, which notes that the assumptions used by the Finance Ministry in drafting the 2015 state budget are “acceptable”.
However, Council President Demetris Georgiades called on the Finance Ministry to be prepared to take the necessary measures if needed, as the current projections may change.
The Troika of international lenders revised up their estimate of a negative growth of 0.4% of GDP, up from -0.9% seen earlier.
“The Fiscal Council announces that the GDP growth rate for 2015 is expected around 0% with a possibility for a small increase,” the Council said.
It added that the projections used by the Finance Ministry in drafting the state budget for 2015 “are within the acceptable limits.”
Furthermore, the Council also said it believes that the economy will continue to contract in 2014 albeit at a smaller rate than the Troika projections, due to higher private consumption.
According to the Troika, the economy in 2014 will contract with a rate of -4.2%, whereas the Finance Ministry believes that the 2014 growth rate will be contained to -3%.
“We maintain our reservations as to whether this phenomenon will continue in the coming years,” the Council noted.
The Council will publish its Autumn report before the end of October.